Bitfinex HACKED - funds stolen !

[mayax]

More than that, CFTC (U.S. Commodity Futures Trading Commission) warned and fined them for doing illegal tradings:

"During the Relevant Period, Bitfinex did not actually deliver bitcoins purchased on a leveraged, margined, or financed basis to the traders who purchased them within the meaning of Section 2(c)(2)(D)(ii)(III)(aa) of the Act. Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled.

Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled."

Instead of actually distributing bitcoins to/from each individual's wallet at the time of a trade, they simply updated ledgers in their database while bitcoin was held offline in cold storage. Then, they maintained a small hot wallet to handle daily withdraws.

https://i.imgur.com/O46UNix.jpg

This is literally exactly what the CFTC forced them to stop doing.

So, CFTC warned that Bitfinex is doing illegal tradings but the people continued to use them.  

Oh, wait ! CFTC is US gov and this one is bad and they want you to be poor.  LOL     Now, deal with Bitfinex shit and their friends from Bitgo.    Most of the exchangers are doing the same.

See: BTC-e, Kraken, Poloniex and all the chinese exchangers.

[ajaxmoor]

Looks like a lot of heavy hitting is now coming on Bitgo in this case. Would really like to hear out what they have to say about this. They just took out any responsibility that lay on them.

[MyBTT]

Not surprising. 2 of 3 is still a new concept. I don't see how Bitfinex chose multisig cold storage. They said that multisig was safer. You can't assure the security of your own keys, so you go to BitGo. Why don't you learn to keep safe yourself?

But to be fair, Bitfinex was forbidden by law to use cold storage

[mayax]

Not surprising. 2 of 3 is still a new concept. I don't see how Bitfinex chose multisig cold storage. They said that multisig was safer. You can't assure the security of your own keys, so you go to BitGo. Why don't you learn to keep safe yourself?

But to be fair, Bitfinex was forbidden by law to use cold storage

 forbidden by law to use cold storage? where?

please read CFCT announcement : During the Relevant Period, Bitfinex did not actually deliver bitcoins purchased on a leveraged, margined, or financed basis to the traders who purchased them within the meaning of Section 2(c)(2)(D)(ii)(III)(aa) of the Act. Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled.

Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled."


where do you see "cold wallet"? but contrary, CTCF warned: "Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled"

https://i.imgur.com/O46UNix.jpg

Bitfinex broke all the financial laws(from China, BVI, USA, EU). They didn't have any license, no insurance, no nothing.

[MyBTT]

Not surprising. 2 of 3 is still a new concept. I don't see how Bitfinex chose multisig cold storage. They said that multisig was safer. You can't assure the security of your own keys, so you go to BitGo. Why don't you learn to keep safe yourself?

But to be fair, Bitfinex was forbidden by law to use cold storage

 forbidden by law to use cold storage? where?

please read CFCT announcement : During the Relevant Period, Bitfinex did not actually deliver bitcoins purchased on a leveraged, margined, or financed basis to the traders who purchased them within the meaning of Section 2(c)(2)(D)(ii)(III)(aa) of the Act. Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled.

Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled."


where do you see "cold wallet"? but contrary, CTCF warned: "Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled"

https://i.imgur.com/O46UNix.jpg

Bitfinex broke all the financial laws(from China, BVI, USA, EU). They didn't have any license, no insurance, no nothing.

I was reading on Reddit, this is what I got. https://m.reddit.com/r/Bitcoin/comments/4vxoj6/cftc_regulation_prevented_bitfinex_from_using/

What irks my curiosity is how China and the US only found out that Bitfinex was breaking laws after they got hacked.

[mayax]

Not surprising. 2 of 3 is still a new concept. I don't see how Bitfinex chose multisig cold storage. They said that multisig was safer. You can't assure the security of your own keys, so you go to BitGo. Why don't you learn to keep safe yourself?

But to be fair, Bitfinex was forbidden by law to use cold storage

 forbidden by law to use cold storage? where?

please read CFCT announcement : During the Relevant Period, Bitfinex did not actually deliver bitcoins purchased on a leveraged, margined, or financed basis to the traders who purchased them within the meaning of Section 2(c)(2)(D)(ii)(III)(aa) of the Act. Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled.

Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled."


where do you see "cold wallet"? but contrary, CTCF warned: "Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled"

https://i.imgur.com/O46UNix.jpg

Bitfinex broke all the financial laws(from China, BVI, USA, EU). They didn't have any license, no insurance, no nothing.

I was reading on Reddit, this is what I got. https://m.reddit.com/r/Bitcoin/comments/4vxoj6/cftc_regulation_prevented_bitfinex_from_using/

What irks my curiosity is how China and the US only found out that Bitfinex was breaking laws after they got hacked.

wrong, CFCT warned about them 2 months ago not 2 days ago when the hack occured and their investigation was since last year

http://www.cftc.gov/PressRoom/PressReleases/pr7380-16

you should read the original documents in order to have the whole image and not what others are saying...

[pbleak]

No wallets associated with this week? That's a weird one.

[155UE]

Looks like a lot of heavy hitting is now coming on Bitgo in this case. Would really like to hear out what they have to say about this. They just took out any responsibility that lay on them.

So any transaction id's to post to show as proofs on bitgo's involvement in to this?
It would be interesting to see if there was any connection other than just bitcoin go to and from these addresses. 

[M28MmickT]

More than that, CFTC (U.S. Commodity Futures Trading Commission) warned and fined them for doing illegal tradings:

"During the Relevant Period, Bitfinex did not actually deliver bitcoins purchased on a leveraged, margined, or financed basis to the traders who purchased them within the meaning of Section 2(c)(2)(D)(ii)(III)(aa) of the Act. Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled.

Instead, Bitfinex held the purchased bitcoins in bitcoin deposit wallets that it owned and controlled."

Instead of actually distributing bitcoins to/from each individual's wallet at the time of a trade, they simply updated ledgers in their database while bitcoin was held offline in cold storage. Then, they maintained a small hot wallet to handle daily withdraws.

https://i.imgur.com/O46UNix.jpg

This is literally exactly what the CFTC forced them to stop doing.

So, CFTC warned that Bitfinex is doing illegal tradings but the people continued to use them.  

Oh, wait ! CFTC is US gov and this one is bad and they want you to be poor.  LOL     Now, deal with Bitfinex shit and their friends from Bitgo.    Most of the exchangers are doing the same.

See: BTC-e, Kraken, Poloniex and all the chinese exchangers.

Wrong, CFTC didn't like the way how Bitfinex managed customer funds ( by having a cold wallet managing it) , CFTC told Bitfinex customers needed to posses ownership once they buy Bitcoins intead of using a general cold wallet, Bitfinex got fined for this and changed the security process as recomended by CFTC, then Bitfinex is hacked.

[bjman]

I hate govt. regulations, but anyone blaming the CTFC is being ridiculous. Aside from the details of the settlement, they didn't force bitfinex to not have basic security procedures such as how to protect the multisig signing keys or to have some kind of mechanism in place to stop massive withdrawals--eg. stop any withdrawal over 20,000 btc per day, etc. etc.

[M28MmickT]

I hate govt. regulations, but anyone blaming the CTFC is being ridiculous. Aside from the details of the settlement, they didn't force bitfinex to not have basic security procedures such as how to protect the multisig signing keys or to have some kind of mechanism in place to stop massive withdrawals--eg. stop any withdrawal over 20,000 btc per day, etc. etc.

Yes that is true but is not blaming the CTFC for that but to point there is no need on recommending security tips or fine a Bitcoin exchange successfully running since 2011, obviously the best way to protect user funds against external attacks is on the people with the experience of Bitfinex, however when speaking of inside attacks there is no security that can be inmune to it.

[BitcoinNewsMagazine]

https://www.reddit.com/r/BitcoinMarkets/comments/4w2osg/daily_discussion_thursday_august_04_2016/

We are still working out the details so nothing is set in stone, however we are leaning towards a socialized loss scenario among bitcoin balances and active loans to BTCUSD positions. The numbers being quoted are erroneous as nothing has been decided as of yet and we are still in the process of settling positions and balances. More details are to follow tomorrow. Furthermore, tomorrow we will be posting a FAQ on the blog that will answer most of the questions we have been asked over the past couple days.

There is talk of a more than 60% haircut for all and issuing a new BFXCoin.

[Achargeturry78]

This is an inside job how can i say that this is inside job ? first of all the website has no license and if you are trying to view the information of the owner of the website it's hidden im trying to view the website information here : ( http://whois.domaintools.com/bitfinex.com ) same old shi*t's like the investment website where they , wait untill more investors to come and invest on their website and turn into scam that they will say they hacked by someone old but gold for them

[Searing]

From Bitfinex terms of service currently cached only. Grabbed it just now. If any doubt they are gonna stick the users for the site this should clear that up as a YES THEY ARE.

There is no guarantee against losses on the Site.

You may lose more than is in your various wallets on the Site if you engage in financing on the Site.

cached link

https://webcache.googleusercontent.com/search?q=cache:DMFWehppBtkJ:https://www.bitfinex.com/terms+&cd=1&hl=en&ct=clnk&gl=us


Anyway, all they need in that entire page imho is the 1st line. Or so their law firm will say.

They are INDIVIDUAL wallets....if your wallet was NOT hacked you likely should be OK. (unless bitfinex goes bankrupt) IF you did by chance have a wallet

that was compromised.....imho you are screwed for sure.

Others can chime in here ....but seems as clear as mud to me from what I know of LAW firms and terms and conditions..(hopefully I'm wrong....but even if wrong I doubt

they have 70 million to cover this even if they do lose a court case say 2 years from now)

Only and I mean ONLY option I could see is make a deal with the hacker and HOPE he only wanted 10% as his fee.

No other out that I can see.  (I have no money in bitfinex just from the sidelines here slap me down if you want for my 2c worth ..perhaps I should not even be commenting)

but anyway here is the cached link to their terms

[bones261]

From Bitfinex terms of service currently cached only. Grabbed it just now. If any doubt they are gonna stick the users for the site this should clear that up as a YES THEY ARE.

There is no guarantee against losses on the Site.

You may lose more than is in your various wallets on the Site if you engage in financing on the Site.

cached link

https://webcache.googleusercontent.com/search?q=cache:DMFWehppBtkJ:https://www.bitfinex.com/terms+&cd=1&hl=en&ct=clnk&gl=us


Anyway, all they need in that entire page imho is the 1st line. Or so their law firm will say.

They are INDIVIDUAL wallets....if your wallet was NOT hacked you likely should be OK. (unless bitfinex goes bankrupt) IF you did by chance have a wallet

that was compromised.....imho you are screwed for sure.

Others can chime in here ....but seems as clear as mud to me from what I know of LAW firms and terms and conditions..(hopefully I'm wrong....but even if wrong I doubt

they have 70 million to cover this even if they do lose a court case say 2 years from now)

Only and I mean ONLY option I could see is make a deal with the hacker and HOPE he only wanted 10% as his fee.

No other out that I can see.  (I have no money in bitfinex just from the sidelines here slap me down if you want for my 2c worth ..perhaps I should not even be commenting)

but anyway here is the cached link to their terms

The problem is, many of the wallets that were hacked were apparently the one's holding positions in the margin trading. It appears that those participating in the margin lending between BTC and USD are going to be taking the haircut.  
http://blog.bitfinex.com/uncategorized/update/
Bitfinex is looking to spread the loss around in a "socialized loss." Many of their customers will be sharing in the loss. I bet Bitfinex won't spare one satoshi, to mitigate the losses. Gee thanks Bitfinex. Way to show the community that your exchange is not responsible for anything.

[noormcs5]

If you're stupid enough to keep your coins on an illegal exchange, then you deserve to have your coin's stolen. This was probably a good thing.

I am surprised, it is illegal exchange and people have use it for their biggest amount. Seriously it is very stupidnest, who you can trust it even you don't know about Bitfinex. I thing they people deserve it to lost their bitcoins. And i am also heard it is second time, that Bitfinex has been hacked, it is lesson for us, if we want to use the bitcoins so you must be think how you can safe your bitcoins.

[bones261]

If you're stupid enough to keep your coins on an illegal exchange, then you deserve to have your coin's stolen. This was probably a good thing.

I am surprised, it is illegal exchange and people have use it for their biggest amount. Seriously it is very stupidnest, who you can trust it even you don't know about Bitfinex. I thing they people deserve it to lost their bitcoins. And i am also heard it is second time, that Bitfinex has been hacked, it is lesson for us, if we want to use the bitcoins so you must be think how you can safe your bitcoins.

Stick your paper wallet in a safe and bury it 1 mile deep in the ground. Place it in the middle of a mine field. Your bitcoins will be nice and safe. You won't be able to use them, easily. But they will be safe and sound.

[marky89]

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.

[bones261]

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.

[marky89]

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.