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Author Topic: Do the withdraw limits on MtGox make it safe from major hacks?  (Read 1060 times)
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September 18, 2011, 12:16:16 AM

They can only withdraw 100BC or $1,000 a day (max $10,000 a month) so they can't take 20,000 coins from one account.

There are several different types of Bitcoin clients. EWallets are like banks -- a central organization has complete control over your money. You shouldn't put much money in EWallets.
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September 18, 2011, 09:42:15 PM

It makes things safer, but not 100% safe. In the June hack the hacker deliberately crashed the price to .01 to try to transfer more coins out.  I don't know if it worked.

If someone roots the server they might be able to circumvent the transfer limits.  There are more possible levels of protection - they might store the wallet on another machine that only processes transaction batches, verifies that there are no excessive withdraws, and doesn't have any other communication with the outside world.  That's how I'd do it, but I can't say if Gox does.

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Founder and CEO of WHOOOOOOSH Financial

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September 24, 2011, 10:07:12 PM

Even if there is another major hack, Magic: The Gathering Online Exchange will just call a do-over and reset back to where the market was pre-hack anyway.

Do you know what it's like to be built this way?
With only the power to push others away?
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Gerald Davis

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September 26, 2011, 07:09:17 PM

That is the point.  The point of crashing the price is just to temporarily allow massive transfers.

Say BTC is worth ~$5.  The $1K limit means you can only move 200 coins daily.  If an account with 80,000 coins is compromised only a small amount can be moved daily.

If the price crashes to $0.01 USD : BTC then the $1K limit would allow 100K BTC to be moved.  Once moved it is obviously irreversable.  It doesn't do the owner of the compromised account any good if trades are reset and price put back to $5.  The BTC are still gone.
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September 27, 2011, 10:40:42 PM

i don't see why scammers couldn't send in fake ID scans to any exchange and up their limits to whatever withdraw amount they want, then clean out the system.

i would hope Gox and other exchanges installed some safety measures to halt trading if the value goes too low/high too fast, must like the TSX/NYSE does
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