Major Bitcoin theft from website, claims owner

[IDemo]

Source: BBC News

A man who ran an online "wallet service" for storing Bitcoins has claimed hackers stole virtual currency from his site worth more than one million Australian dollars.

The Australian man said 4,100 Bitcoins (US$1.04m, £650,000) were taken in two separate attacks.

He said he would not report the theft to police as Bitcoin transactions are virtually impossible to trace.

This has led some users to speculate whether it was an "inside job".

Read more: http://www.bbc.co.uk/news/technology-24871444

[tridim]

1. LOL @ bitcoin...

A bad idea that just keeps getting worse.

[Nye Bevan]

7. Absolutely. Because plain old cash never gets stolen (nt)

[tridim]

8. Cash in a bank is insured.

Bitcoin is insured against nothing. If they get stolen, too bad. It is more of a scam than the stock market.

[quakerboy]

12. Cash in your wallet isnt, though

Prepaid/gift cards are usually use it if you got it, non replaceable. If you stash some cash in your closet, that's probably not insured. Bitcoin doesn't seem that different than any of these.

And i would strongly suppose that even bank insurance is only good so far. For instance, if someone gets your pin and withdraws a million in cash from your bank account, or steals your checkbook, I doubt that anyone is paying that back to ya. Though unfortunately i've never had a million to have stolen to test this theory out.

[saidsimplesimon]

2. Bitcoins another fiat currency?

Do we really need another Wall Street, or Off Street insider trading scandal?

IDemo, where are the new young turks with an alternative economic paradigm that can replace the current "race to the bottom" or "death by a thousand cuts"?

[MyNameGoesHere]

3. Yes open source strikes again

Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part.

And nobody regulates it either.

[ljm2002]

14. Its being open-source does not make it less secure...

...rather the reverse, actually.

In fact, open-source encryption software is generally agreed to be much more secure than proprietary systems. Why? Because there are thousands of smart, well-versed people who can look at it and vet the algorithms and ensure that it lacks sneaky back doors and other vulnerabilities. Whereas proprietary systems have limited staff to check it, and they also make deals with government to build in trap doors for the government to use -- and since their code is hidden from view to outsiders, there is no one to call them on it, unless an insider reveals the information.

Bitcoin uses modern encryption technology. With modern encryption technology, the fact that the algorithms are well-known and that the code is available for anyone to see, does not diminish the security of the encryption algorithm, and in fact strengthens confidence in the system's overall integrity. The encryption is either theoretically sound, and implemented properly, and uses a big enough key, or it doesn't.

Anyone who says that open-source makes a system less secure, is merely exposing their own lack of understanding on the topic.

[MyNameGoesHere]

15. I did not mention security

but I see you regurgitated the "smart and well versed people" line. Yeah, those people would include thieves, organized crime, and little kiddies that want to create havoc. So if I want people to not rob my house the obvious solution is to hand out my keys to everyone in the world. Or better yet just have a sign saying everyone welcome but pretty please don't steal anything.

I am more concerned over the lack of regulation and oversight. I will play the "open source is better" myth when they submit to some kind of oversight. We are talking about a new monetary system by the way. If it ever wants to gain acceptance it needs to submit to some authority. Otherwise it is just a fad.

[ljm2002]

16. The story is about some bitcoin being stolen...

...so security would seem to be a factor.

Your entire post on the subject was:

"Yes open source strikes again

Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part.

And nobody regulates it either...."

You may be "more concerned over the lack of regulation and oversight", but your post relegated it to an afterthought. Anyway, regulation of our current monetary systems is la joke -- LIBOR rate rigging, anyone? How many criminal charges have resulted from that criminal activity by supposedly regulated banks?

Some of the largest companies responsible for producing proprietary software systems agreed to build back doors into their systems, and implemented compromised encryption systems, and pushed flawed encryption standards, at NSA's request. Does that fall into your definition of "thieves" and "organized crime"? Probably not -- but promoting compromised encryption systems and passing them off as secure is criminal in my estimation. Also, are you really arguing that closed source systems are not susceptible to "thieves, organized crime, and little kiddies that want to create havoc"??

[MyNameGoesHere]

17. Thanks

I am getting older and I was sure that I did not use the word security at all in my original post. I should have put quotes around that since the first part is bitcoins definition of what it is. The "after thought" as you put is where my words began.
Yes our regulations are crap. Enforcement even more so. But bitcoin is damn near untraceable. It will never be a serious monetary contendere operating like that.

[ljm2002]

21. Well my only point was about open source...

...and I will readily admit I know very little about bitcoin or whether it might be a good model for money or not. I'm wondering these days whether we need to use money at all -- but of course, the question then becomes, what do we use instead, if anything? and if nothing, how would that work?

TTFN

[7962]

4. Gee, who didn't see THIS coming? nt

[Paper Roses]

5. OK all, help this old lady:

I have enough trouble keeping up with everything I can.

What the heck is a bitcoin?

[muriel_volestrangler]

6. There's a video on the BBC page; or take a look at this thread:

http://www.democraticunderground.com/?com=view_post&forum=1002&pid=3955460

[Arkana]

9. Wow, the scammers got scammed.

[Earth_First]

10. Even *if* he were to call law enforcement...then what?

Governments are making moves to ensure the currency is unable to get a foothold against traditional curriencies.

I wouldn't expect much cooperation by law enforcement or government, barring a personal investigation into this individuals personal financial transactions...

[DonCoquixote]

11. The onyl way Bitcoin coudl really work

Is if the UN backed it..
then again, thanks to the NSA waking up the rest of the world to the fact they let America run the internet for too long, that might just happen.

[snot]

13. Very interesting.

[Sunlei]

18. to bad they don't have developers who could restore his bitcoin as if it was everquest platinum

pixel money

Then they could delete the bitcoin from the thief and roll him back to a naked level 1 as punishment

[Myrina]

19. One of my IT-techie besties has tried to get me to 'invest' ....

... she's already sunk a couple thousand real dollars into it and seems obsessed with tracking her investments on her phone all day long.

Is it something tangible, real? To me, it seems like buying "Farmville money".

[Incitatus]

20. I think an above poster was right when he said it's a worse gamble than the stock market.

Your friend might get lucky. It is still a gamble.

[jmowreader]

22. Head on down the New Silk Road

If someone you never heard of before posts a WTB looking for a ton of heroin...that's who you're looking for.