The website is still a scam. I don't trust them anymore (I didn't use it ever, but I would have probably trusted it if I needed to). I expect another "hack" phase to begin when the site will be fully working once again. A $65M loss is a huge amount, the temptation to steal it as the owners is as big as the amount is.
Why using the word "Scam". When did bitfinex scam you? Did they have a bad reputation that they scam people? and you have a evidence about that? All I know is that there site was hacked last week that's all and no scam happened because the owner of the site also suffers and also the users of that site  Whether or not they orchestrated the hack themselves, they are still scamming people with this 36% haircut. There is no transparency; they aren't showing us the books. And a socialized loss is legally dubious; the consensus seems to be that in common law countries, this is analogous to some bank deposit boxes being looted. That doesn't give Bitfinex the right to redistribute assets for other customers' deposit boxes. In this case, we know whose bitcoins were stolen; now peoples' USD/ETH/LTC/ETC are being stolen to partially replace them. |
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I think this would slow down the process of being able to sell bitcoin on their platform, as well as the ability to to debit customers' losses when they have leveraged losses. Probably not so much, because they only settled accounts to the blockchain once per day. The exception being, if you bought bitcoins and immediately requested to withdraw them. That already took 15-45 minutes generally. Not sure how much this would really add. The problem with BitGo is that they signed transactions that they should not have signed. I speculate that BitGo was signing transactions they believed to be "internal transfers" between bitfinex accounts, which I suspect are not subject to the limits that bitfinex set, although this is speculation.
They certainly signed transactions they shouldn't have signed. Even if they were internal transfers, that kind of volume (above, say, 20k or 30k) should trigger a circuit breaker. A telephone call, some kind of second step verification...something, rather than simply auto-signing for 120k bitcoins. |
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Too little, too late for BitGo. They are done after this. A bitcoin security firm cannot recover from co-signing 120k BTC in fraudulent transactions -- automatically and instantly. Their reputation is completely ruined, and if it were a serious comment (LOL), I would say, stay as far away from that company as you can. Because it will hurt your reputation, too.
I'm staying away from them as well. Hardware wallets are the best way to go in terms of storing bitcoins. However, this was an exchange. BlockNet [And similar exchanges], appear to be the way to go in the future for trading. It's currently in beta. Are you talking about a decentralized exchange? What it all boils down to..... it's basically impossible to find the liquidity that high volume/high frequency traders need outside of centralized exchanges. It's an unfortunate state of affairs, and one that I'm losing money over (for the first time). I wonder what things may look like in 5-10 years. |
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The following IS THE WAY in which BitFinex should have used multi-sig wallets for customer accounts:
1. The "customer" should have one of the 3 keys.
2. It is MANDATORY the "customer" key be used to withdraw funds from their account in conjunction with Finex key.
3. BitFinex would not be allowed to withdraw funds from a "customer" account without the permission of the "customer" via the "customer" key.
4. BitFinex would not be allowed to withdraw funds from a "customer" account in conjunction with BitGo key without BitGo receiving permission DIRECTLY FROM THE CUSTOMER via email and/or 2FA.
5. If the "customer" lost their key, this is the ONLY TIME BitGo key would be used to withdraw funds. HOWEVER, the "customer" would have to be the one to give BitGo permission VIA EMAIL directly with BitGo in order for BitGo to use BitGo's key with BitFinex key to withdraw funds.
It's really quite simple. It's common sense. WHY it was not done this way is beyond comprehension. The key that BitFinex held in cold storage SHOULD have been the "customer's" key; NOT BitFinex's secondary key. They might as well throw that cold storage key in the trash. It was never going to be used unless BitFinex lost the key they were using.
A multi-sig wallet should also have a 4th key held in cold storage by BitGo to be used only in the event BitFinex AND the customer lost their keys.
EDIT: WHY, BitGo did not INSIST it be done this way as the terms of doing business with BitFinex is sickening as well.
+1 you may ask BitGo to serve as the Chief Compliance Officer for +250k USD per year.  Too little, too late for BitGo. They are done after this. A bitcoin security firm cannot recover from co-signing 120k BTC in fraudulent transactions -- automatically and instantly. Their reputation is completely ruined, and if it were a serious comment (LOL), I would say, stay as far away from that company as you can. Because it will hurt your reputation, too. |
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Is there actually any useful information on this, such as the legality surrounding what Bitfinex has done, and more importantly, the best agency to complain to............or is it all just rage and misinformation? As someone holding only USD (unlended) I am pretty pissed off. But I'm not gonna complain to anyone and I prefer others do the same. We need to get what we can off Bitfinex now, should they give us the chance. A bankruptcy following seizures would leave us with nothing years down the road. I'm pissed but I'm also desperate to get back some of my cash -- and not through the courts. |
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What's the point of all these BFX tokens everyone gonna receive for the loss? They say it will be possible to exchange them for shares, but who wants shares of an insolvent exchange?
Technically they are not insolvent if they remove the liabilities from their books. These tokens would likely come with terms that they do not guarantee anything (hence are not real liabilities). So while the tokens may or may not actually pay out some dividends in practice, they don't have the same effect on solvency (from an accounting perspective, and possibly from a legal perspective). That's a good point. Their lawyers and accountants may find a loophole or something, but if these tokens aren't really liabilities, why should people accept them for their losses? There will be a class action demanding complete and immediate return of the assets. Bitfinex will lose in court and may go bankrupt. Many people will take the 64% and run, knowing what a bankruptcy would cost them. They would lose much more than 36%. And it would take them years to get back whatever scraps they do get. There is also another problem: Bitfinex is set up in a way that is difficult to litigate against. If it ever got to the point that the US Feds seized their known assets and bitfinex.com, the owners would just take any assets that were left and flee. |
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I think no one learned the lesson yet. They are waiting to get back 64% of all of their funds in order to keep trading in the immediate future. Even if bitfinex goes down for good all the people who used to keep their coins in an exchange will continue to do so as soon as a new exchange will pop up. Trading is a lot like gambling if it becomes addicted you are done.
I like to think that long term traders understand the risk/reward of keeping money on exchanges -- just like they understand the risk/reward of any given trade. I will be hurt pretty badly by this Bitfinex theft, and I'm sort of pissed off that they are socializing losses, as I was not holding any BTC at the time. Nevertheless, I have made many times more (and removed to my bank or cold storage BTC) than what was in my account balance over the years of trading there. So I know I did the right thing by trading there. I spread my risk around several exchanges and I will continue trading with adequate risk management. |
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What's the point of all these BFX tokens everyone gonna receive for the loss? They say it will be possible to exchange them for shares, but who wants shares of an insolvent exchange?
Technically they are not insolvent if they remove the liabilities from their books. These tokens would likely come with terms that they do not guarantee anything (hence are not real liabilities). So while the tokens may or may not actually pay out some dividends in practice, they don't have the same effect on solvency (from an accounting perspective, and possibly from a legal perspective). |
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Thats a good news for those who trading in bitfinex they dont need to be worry because they are giving back and credited after calculate all loses..
I hope they will success to secured their website..
It's not good news. Everyone is taking a significant haircut on their funds. They are suggesting the offering of a security asset (which they are not authorized to do). And socializing losses this way is illegal for US customers. US customers (and others, but I only know US law) are considered bailors, and Bitfinex is now converting their bailments and paying out other customers with the proceeds. They have no right to do that, and they are about to enter a legal shitstorm as a result. Every crypto that held an ICO should been a shitstorm if that were the case. It hasn't really happened until now. Regulators have their hands full with other stuff. ICOs are generally run by fly-by-night unknowns. Not the case with Bitfinex, which has been established for years now as the highest volume USD exchange. There is no comparing this to shitcoin ICOs. Also, ICOs tend to have a more distributed creditor base (many people buying small amounts). Bitfinex has some major, major whales, and it only takes one or two of them to make a major legal headache for Bitfinex. Very different situation. Isn't Ethereum established enough? The ICO was big enough that if it went down as a complete scam, then there may have been some interested parties and courts going after the Ethereum Foundation. But since they paid out the ICO and the market price never went below it, who the hell is gonna complain? Financially, everyone made money. Not all ICOs play out like that. |
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bitfinex has declared that it will cut 35% prices down from all of its users. this is so weird. after this announcement, bitcoin prices increased 10 dollars suddenly ..this is ridiculous.
Well, the market hates the unknown, and loves resolution. I guess knowing that the other 64% of the liquidity is going to come back to the market, and knowing that Bitfinex [might be] okay in the immediate future (as in, customer assets were not completely decimated), might be fundamentally good news for the market. I'm not sure how this socialized loss stuff plays out legally, though. |
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They have run the perfect scam. First they take 60M from some people with a massive inside job theft, then they take another 60M from everybody with another theft, but this time, people are actually saying thank you.
To be fair, there was only one theft. The 36% haircut is accounting for that one theft. We just hadn't gotten any clarity on how customers would be affected yet. I'm still unsure whether this was an inside job. It certainly could be, but that wouldn't necessarily mean all of Bitfinex is involved at all. Just one or two employees (or possibly BitGo employees). |
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Sad that this list keeps growing & getting added to every year. I wonder what % of coins that have been mined have been stolen from their rightful owner(s).
That's something we'll never know. There's been so many small (and large) scams in Bitcoin that hardly anyone can keep track. I suspect this Bitfinex theft will stay near the top for quite some time. Around $70,000,000 at the time. Really quite sad. I too had money on the exchange, and am trying to prepare myself for the worst. At least this is the first time I've been hit by a hack/scam/etc. |
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Title says it all
Bitfinex. Will they cover the 65 million dollar BTC Theft or just fold?
You can comment here. But please take the Poll.
Myself I'd be shocked if they could cover a 65 million dollar btc loss. But the poll will tell here, so feel free to vote.
I would say that bitfinex needs just some time to see if they can find the stolen bitcoin That isn't gonna happen. The coins haven't even moved, and if the hacker is smart, they won't move them until long after this debacle is done with. He won't be dumb enough to sell on exchanges, given how sophisticated the attack was. Basically, we are hoping an investor swoops in and re-capitalizes the company. Bitfinex's owners won't like the offers they are receiving (probably in the range of $60mm for full ownership), which is why they are talking haircuts. Next, we are hoping that owners give back significant profits to make a haircut less painful, while securing a plan to repay the debt over time. Hopefuly this would be accompanied by some level of investor recapitalization, to minimize the amount outstanding and thus, minimize the amount of potential litigants moving against them. I don't want to see this end in bankruptcy. We've seen what happens with Gox. The bankruptcy industry will bleed the assets down to nothing over years, and at the end, customer depositors will be at the end of a long list of creditors. We will get nothing. That's if you could even find the Bitfinex owners and secure the remaining assets. Big if. I'm just praying I get something back, and in the next few weeks -- not a few years from now from bankruptcy proceedings. |
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Of course, the other day i wasn't hable to enter to Yobit, life for 5 days, i was desesperated, so a few days ago, i transfer all my balance to Coinbase, i wan't to do it on my own computer but i donīt know how to do this  Coinbase likely has a more secure setup with significant cold storage. But remember, all exchanges are prone to being hacked. And particularly in the case of an inside job, even cold storage is not safe. Remember, Coinbase is also just issuing IOUs. Someday, the bitcoins backing those IOUs may go poof. My problem is inability to hedge fiat value of BTC without exchanges. So I may be out significant money at Bitfinex since I was holding USD, waiting to swing trade back into BTC. (And yes, planned to buy at $460s. FML) |
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Now fishing emails rushing up all over bfx userbase. Fuckers. When a company sends out phishing mails and writes up a blog post that covers the precaution measures against mails they themselves send out thats a fucking bad sign. Look around, where are all crypto exchanges that have run up debts in their ambition and gone insolvent after similar phishing horseshit.
who said that they are sending these emails??? I'm a bitfinex customer, and I did not receive phishing email! I can also confirm I did not receive the email. I'm guessing someone just took a database that was leaked already (many bitcoin businesses have leaked databases all over the dark web) and took a shot at scamming some more money. No signs that it came from Bitfinex. |
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What do you think guys about the funds from bitfinex do you think they already sell those bitcoin in the other market.? thats why the price of bitcoin is down or thats why the price of bitcoin is down its because they already seen the news about hacking bitfinex? an many people saw this news and sell their bitcoin thats why the price of bitcoin is down?
I don't think the coins have moved since they initially left Bitfinex's control. I haven't actually researched the addresses in question, but that has been what Zane has been saying for the last couple days. The hacker would be a fool to move those coins to an exchange. Best bet is to at the very least mix them before using them. In any case, he would be wise to do nothing for a while. |
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gox 2.0. RIP bitfinex...
Thinking about this. What if they get back in business after this? Will they really cover the loss? They should if they want their supporters back right? Without paying up then I dont think trust will be back also. Well, it seems Zane has now confirmed that BTC holders and USD lenders who had funds tied to BTCUSD longs are taking a haircut. Not clear if everyone else gets 100% of their funds, but sounds like it. So -- those people (who get made whole) might support them and stick around to some extent. But there is gonna be a lot of pissed off customers who had BTC that has gone poof. I hope their customer base goes poof in short order. Why would anyone want to support a business who will not take any kind of responsibility at all? I don't see them offering even one satoshi or fraction of a penny to help mitigate the losses. It's not clear that they aren't taking responsibility, to be fair. We haven't seen the total numbers, and we technically don't know the % that 119k bitcoins represented vs. their total bitcoin supply. We don't know how much profit the company/directors are disgorging (if at all) -- they may be giving up tens of thousands of bitcoins and millions of dollars to make this less painful for customers. But it is clear that they cannot bear the entire cost without shutting down. Their terms of service are pretty bad -- they basically say, we take no responsibility and have no liability. You're on your own. Now, I don't know if that actually holds up in court, but it seems they are taking that route. Hopefully they show some goodwill and are transparent, and can show that they are contributing a significant portion of their own holdings to the effort. I would like to see BitGo pony something up too.....idiots. |
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We have seen the hacking attack of reportedly 60M USD from Bitfinex and the attack of the DAO for reportedly around double that amount.
But after both attacks we have seen two very different things happen.
In the case of the Bitfinex attack there isn't even the slightest suggestion that some sort of "hard fork" would be offered by the Bitcoin Core developers (so they are just going to have to wear their loss for their mistake) but in the case of Ethereum we have now ended up in a "fork war" with ETH vs. ETC (and ironically ETC is actually the "original" code with ETH now being a fork).
Opinions?
Fortunately, I think this has set the fork-at-any-cost camp back in a huge way. I think they realize that their only chance to get big blocks is to fork without any suggestion of majority or consensus. I think some of the more extreme big-blockers see the viability of both ETH and ETC as a reason to say "let's fork and let the market decide." Terrible idea, but there will always be some around here who are willing to break consensus for their agenda. |
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gox 2.0. RIP bitfinex...
Thinking about this. What if they get back in business after this? Will they really cover the loss? They should if they want their supporters back right? Without paying up then I dont think trust will be back also. Well, it seems Zane has now confirmed that BTC holders and USD lenders who had funds tied to BTCUSD longs are taking a haircut. Not clear if everyone else gets 100% of their funds, but sounds like it. So -- those people (who get made whole) might support them and stick around to some extent. But there is gonna be a lot of pissed off customers who had BTC that has gone poof. |
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How do people know for sure (other than fearing the worst), that they have been robbed on Finex? Are the thefts visible on the blockchain as withdrawals from personal wallet addresses on Bitfinex?
The thefts are visible on the blockchain, yes. Since last summer, you may have noticed you have 3 multi-signature addresses assigned to your account. If you kept BTC in, say, the exchange wallet, Bitfinex/BitGo would move those BTC to your exchange wallet address. We have widespread confirmation from watching these addresses that massive amounts of bitcoin were drained from them on the early morning of August 2. |
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