[2016-08-29] Risk of Bitcoin Hacks and Losses Is Very Real

[sirohige]

When hackers penetrated a secure authentication system at a bitcoin exchange called Bitfinex earlier this month, they stole about $70 million worth of the virtual currency.

The cyber theft—the second largest by an exchange since hackers took roughly $350 million in bitcoins at Tokyo’s MtGox exchange in early 2014—is hardly a rare occurrence in the emerging world of crypto-currencies.

New data disclosed to Reuters shows a third of bitcoin trading platforms have been hacked, and nearly half have closed in the half dozen years since they burst on the scene.
http://fortune.com/2016/08/29/risk-of-bitcoin-hacking-is-real/

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[panju1]

When hackers penetrated a secure authentication system at a bitcoin exchange called Bitfinex earlier this month, they stole about $70 million worth of the virtual currency.

The cyber theft—the second largest by an exchange since hackers took roughly $350 million in bitcoins at Tokyo’s MtGox exchange in early 2014—is hardly a rare occurrence in the emerging world of crypto-currencies.

New data disclosed to Reuters shows a third of bitcoin trading platforms have been hacked, and nearly half have closed in the half dozen years since they burst on the scene.
http://fortune.com/2016/08/29/risk-of-bitcoin-hacking-is-real/

This is one reason why users should be willing to pay a premium for exchanges which have established processes in place.
Exchanges which are well capitalized and perform third party audits of their reserves should be looked at favourably.

[TraderTimm]

This isn't anything new.

Most seasoned Bitcoin users understand that if you don't have personal control over your private keys, you don't "hold" squat. Never use any other service for anything but instantaneous transfer of value, if you can help it. Consider anything external to your personal wallet a risk. Much like cash, you have to be careful. It seems most people can grasp that concept with bills in their physical wallet, but make serious mistakes when it is "virtual".

[gentlemand]

When hackers penetrated a secure authentication system at a bitcoin exchange called Bitfinex earlier this month, they stole about $70 million worth of the virtual currency.

And when hackers got past the first layer they discovered the entire joint was wide open and just aching to be emptied. If their customers knew that's how it was going to be then I don't think there would've been anything left to hack.

That's if it was an outside hack of course. If we knew what was a genuine hack and what was an inside job we may be rather surprised at the stats.

[1Referee]

This article is focusing too much on hackers while the exchange operators are much more of a danger since they have access to all wallets. And the worst part is, that if people come back to such an exchange, that the operators can do all this once again for another major jackpot payday.

[notthematrix]

Its very simple guys.....
IF YOU DON'T OWN YOUR KEYS ITS NOT YOUR BITCOIN!
https://www.youtube.com/watch?v=IwP1DOHYLaE

[BellaBitBit]

I behave as if at all times someone is trying to steal my bitcoin and other crypto.  I agree that this is old news but newcomers should know how to protect themselves so it is a good reminder.

[richardsNY]

Its very simple guys.....
IF YOU DON'T OWN YOUR KEYS ITS NOT YOUR BITCOIN!
https://www.youtube.com/watch?v=IwP1DOHYLaE

Tell that to the people using exchanges as a long term storage solution for their coins. No matter how many exchanges get hacked, there is always a group of people that never learn from their bad habits. They will only learn when it's too late, which is the time they lost their coins.

[a7mos]

Its very simple guys.....
IF YOU DON'T OWN YOUR KEYS ITS NOT YOUR BITCOIN!
https://www.youtube.com/watch?v=IwP1DOHYLaE

I totally agree with your statement.
 bitcoin protocol can never be hacked. all the hackings that happened are either for exchanges that did not secure their wallets or servers well or for individuals who use defected computers or softwares that may steal their btc.
that is why I believe that using a wallet that do not give the private key is just stupidity

[Karartma1]

There is a kind of irrational motive which points towards the belief that exchanges are "secure". In the Bitcoin ecosystem this is never true and most of you recognize the Bitcoin leitmotif: no keys control, no bitcoins.

But it's hard to be responsible and people prefer to rely on third parties. And then they blame hackers for those thefts. They will always have to blame themselves.