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Saturday, May 3, 2014

Attack against LocalBitcoins infrastructure 3.5.2014

LocalBitcoins received a very dangerous attack against the site infrastructure on Saturday 3.5.2014.
For now
All user data and Bitcoins are safe;
The site will be down for a while as the system is being rebuilt

Details

LocalBitcoins hosting provided received a request to restart the LocalBitcoins.com website server and give access to the server console (root) on Sat May 3 13:32:27. LocalBitcoins team did not initiate this request. For now, it looks like the request was made using spoofed email addresses and other weakness in the hosting provider support system.

• LocalBitcoins team was alerted about the abnormal activity when the hosting provider restarted the server.
  The attacker gained a root access to the server for ~40 minutes before the attacker was kicked out and the server shutdown.
• All data on the website server is encrypted. Manual actions are needed to make this data readable, so the attacker could not gain access to the data even when having a server console access.

It is very unlikely that the attacker gained access to any data;  LocalBitcoins is still performing full investigation on the matter.

• Bitcoins in hot wallet and cold wallet are safe, as LocalBitcoins runs its bitcoind and wallets on a separate server.
  LocalBitcoins team has started to rebuild the website server on fresh hardware.
• LocalBitcoins team will make further announcements when the investigation proceeds and the site becomes available again.  

We expect to spend at least 24 hours on this. LocalBitcoins team apologizes the issues the downtime may cause to the users.

This is pretty standard social engineering, the hosting company screwed up big time. They gave someone root access with apparently no real validation.

Another bad news for bitcoiners because now peoples more worry about bitcoin trade

usually you find out the data centre is a "buy a domain and server in bitcoins".. thus it normally ends up as an inside job but twisted into being from a social engineering attempt, that way the customer is too busy calling the host incompetent and not able to have time to realise their the thief

so here are some lessons
1. temptation - DO NOT use a data centre that knows and uses bitcoins themselves, the temptation to steal is higher if people know the data on their system has value to them.

2. pre-knowledge -  the fact the the data centre knows about bitcoin also makes it easier for them to navigate your source code without taking long.

3. admin rights. if you own the domain YourDomain. then DO NOT register ceo@YourDomain.com or anything@yourdomain.com instead have the data centre only take requests and queries from a email that looks nothing like your domain. and does not appear on any search listings of your domain or the CEO's personal details. in short make a new address and get the data centre to verify you each time.

4. set up a passphrase that must be mentioned in all correspondence.

5. if your choosing a bitcoin payment datacentre that does not have admin security... dont use them.

 so stick to FIAT hosting or keep your servers inhouse if any of the tips above cant be done

If only these hackers could put their talents to good use on something positive...

Very good advice. Thank you.

The Bitcoin network and all its peripheral entities need to be tested while we are in beta.

All this testing from worthy opponents only makes us stronger.

So their talents are being put to good use.

Still a good idea:
Many criminals would be much better off if they would try an honest direction.

Thanks for this useful post. Very useful.

Its secure to run on a cloud service like Amazon ...IMO

What hosting provider was it? Other customers should be warned, it sounds like they are beyond clueless.

*listen*

is LocalBitcoins still safe for trading or it's time to look for another places?

But currently we have no too much places for this trade still this is best place for this work

Nothing lost so much safer than Gox - although "safer than Gox" does not really say much now does it.

Nothing lost so this was basically just a test of their security precautions - and they passed.

They have done and I expect will continue to do a great job.

Couldn't agree more - They're a great team!

Have a side topic, figured mainly Localbitcoins users reading this, someone posted this:

https://bitcointalk.org/index.php?topic=595801.0

Got me thinking, whether we should routinely change addresses, or is it pretty secure so no worries?

What do you guys do?

They were well prepared for an eventual attack.
Their reputation is now even better than before.  :)

do anybody know how is this done exactly? If its not to hard to do, I would like to protect my files on the server too.. thanks

So the Hacker/Attacker having 40min server access had plenty of time to DL data, he just can't read it?

Without decryption, the data should look like just bullshit. :)

i would love to know how could I make this on my server too..

The dns appears of shared hosting while checking at http://whois.domaintools.com/localbitcoins.com
Should use good provider like www.hosticon.com

YES!!! Can you believe how well this was thwarted, plus a full server rebuild in 24h?

COMPARED TO GOX??!!!!!!!!

LBC compared to Gox is like gold compared to DOGCRAP.

Great job, now if they would also do such a good job verifying bank accounts...  ;)

Good news is site admin and devs done very good work and many features back site working

Can anyone confirm whether completing trades works now?  I have my eye on an ad at a good price but on the LBC site there's still an error  across the top

When I log in and see the section:
 How much you wish to buy?  and fill in an amount for FIAT, the site doesn't automatically calculate the corresponding amount in BTC or if I enter a BTC amount, it doesn't show the amount in FIAT.  I know I can calculate it manually but did they change this functionality recently? 

Strange, i still cannot access the website even after a cache clear.

Hi AZ,

Made several trades since the site has come back online. Some features still definitely lagging (file attachments and escrow) however, all my clients received their BTC quickly, so seems to be almost back to perfect.

Non have reported issue with the calculator? Perhaps just manually calculate for now. If wrong, you can Cancel Trade Request and submit another.