Whoopsy!

[EE_]

This aught to get a lot of results ---> "The theft is being reported to—and we are co-operating with—law enforcement."

Bitcoin Price Crashes After Exchange Admits Security Breach, Over $60 Million Stolen
by Tyler Durden
Aug 2, 2016 7:36 PM

Bitcoin prices are crashing on extremely heavy volume - down over 30% in the last 2 days - after Hong Kong-bassed Bitcoin exchange Bitfinex halted all trading after it discovered a security breach. As CryptoCoinsNews reports, the theft of 119,756 bitcoins has now been conclusively confirmed which makes it the largest theft in bitcoin’s space since MT Gox.

Representatives from the exchange told CoinDesk engineers were seeking to uncover issues at press time, though the company had confirmed roughly 120,000 BTC (more than $60m) has been stolen via social media.

Bitfinex statement:

Today we discovered a security breach that requires us to halt all trading on Bitfinex, as well as halt all digital token deposits to and withdrawals from Bitfinex.

We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen. We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, bitfinex.com will be taken down and the maintenance page will be left up.

The theft is being reported to—and we are co-operating with—law enforcement.

As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach. Any settlements will be at the current market prices as of 18:00 UTC. We are taking this necessary accounting step to normalize account balances with the objective of resuming operations. We will look at various options to address customer losses later in the investigation. While we are halting all operations at this time, we can confirm that the breach was limited to bitcoin wallets; the other digital tokens traded on Bitfinex are unaffected.

We will post updates as and when appropriate on our status page (Bitfinex.statuspage.io) and on the maintenance page. We are deeply concerned about this issue and we are committing every resource to try to resolve it. We ask for the community’s patience as we unravel the causes and consequences of this breach.
The result appears to be braod-based selling across all major bitcoin exchanges...

The bulk of the selling occurred once the statement had been issued...

As CryptoCoinsNews adds, Bitfinex has, however, been experiencing numerous problems over the past few months, leading to an unexpected freezing of trading on at least two occasions, both of which caused a crash in bitcoin’s price by almost $100 in each instance.

Bitfinex was also fined by CFTC $75,000 “for offering illegal off-exchange financed retail commodity transactions and failing to register as a futures commission merchant,” in early June, but Zane Tackett, Director of Community and Product Development at Bitfinex, strongly denied any connection between previous outages and CFTC’s fine.

http://www.zerohedge.com/news/2016-08-02/bitcoin-crashes-after-exchange-admits-security-breach

[osoab]

time to buy?

[Cebu_4_2]

LOL. I thought this was impossible. You buy a megaship computer sysyem containing dozens of machines tap into the grid and start mining for just dollars a day and now someone thinks outide the box and discovers it is easier to snipe them. I forget what they call this... entrepreneurship right?

[EE_]

The cool part is that someone is sitting on a shitload of bitcoins...they got very rich very quickly. That was a very big heist!

[Joshua01]

If you don't hold it, you don't own it. I'm not fan of electronic currency. I may be losing out on an opportunity but I can sleep at night

[Cebu_4_2]

I don't give a fuck how you sleep, this is genious to be able to slip aside likely a million locked doors. Genious.

[EE_]

From the beginning, the best thing I liked about crypto currencies was the ability to steal them with no repercussions. The big pluses are, not backed by anything, not insurable, not protected by any institution and anonymous. If I was technology savvy enough, I would be doing everything I could to steal bitcoins. Theft is bitcoin's best aspect...it's like leaving a pile of your money sitting out in a crowded shopping mall. Come and get it!

[Cebu_4_2]

I really liked the iDea of being able to move anywhere on the globe and be able to access my money with no problems.

[Joshua01]

I don't give a fuck how you sleep, this is genious to be able to slip aside likely a million locked doors. Genious.

No question about it. That's why there's none of my wealth behind any of those doors.

[madfranks]

I wonder if it's possible to develop a decentralized exchange, where everyone's funds are secured locally on their own computers rather than in a huge centrally controlled account. I imagine you'd have to develop a new wallet software, but when a single exchange holds (and loses) 100,000+ bitcoins, surely there's incentive enough to develop a technological solution.

[Joshua01]

I wonder if it's possible to develop a decentralized exchange, where everyone's funds are secured locally on their own computers rather than in a huge centrally controlled account. I imagine you'd have to develop a new wallet software, but when a single exchange holds (and loses) 100,000+ bitcoins, surely there's incentive enough to develop a technological solution.

I'd rather just physically hold my wealth. The currency I have in the system is to function within the system until that collapses, at which time I switch to other private holdings of wealth. ANy electronic means can and will be compromised at some point. You need a plan B if you want to be comfortable in this climate otherwise your chasing your money to and fro as these things happen

[Ares]

I wonder if it's possible to develop a decentralized exchange, where everyone's funds are secured locally on their own computers rather than in a huge centrally controlled account. I imagine you'd have to develop a new wallet software, but when a single exchange holds (and loses) 100,000+ bitcoins, surely there's incentive enough to develop a technological solution.

Not likely, as I don't think traders want to wait 10-15 minutes per trade to find out if they got their Bid or Ask price. I've often thought about that too, but the speed at which these transactions move require a centralized system to be able to handle the volume in real time like traders demand.

I'm not sure if anyone has realized but Cryptsy was also taken down by a big heist earlier this year. I had a large amount of alternative coins (no BTC though) there, close to over 500 FRN's worth. Gone. The attacker put a trojan inside the wallet of luckycoin and when Cryptsy installed the updated wallet, they installed a trojan allowing the attacker inside their network to drain their wallets. I wonder if that is what happened with Bitfinex? I guess time will tell.

[Ares]

I'd rather just physically hold my wealth. The currency I have in the system is to function within the system until that collapses, at which time I switch to other private holdings of wealth. ANy electronic means can and will be compromised at some point. You need a plan B if you want to be comfortable in this climate otherwise your chasing your money to and fro as these things happen

Agreed, but digital does make it a hell of a lot easier to transfer and is borderless.

[Dogman]

Physical wealth as Ponce says do not hold it, do not own it , will always trump virtual holdings other than possible interest that can be gained. Virtual wealth will always depend on the media/systems that is held or used, which is the net.

Sure physical is at risk, but at least that wealth can be secured to the point that the ones life is at risk or lost because others will go eyeball to eyeball to get it..

Virtual wealth , depends on strong passwords and encryption which is fine, but that media of use (internet) is always at risk of being hacked and codes broken or Gasp, the net goes away = poof of any wealth. But at least any theft will cause no harm to they that own said wealth.

And all depends on the net to always be there and the servers that is holding that wealth exist, one burp or hack = poof.

Another example of if you do not hold it .




https://www.youtube.com/watch?v=_nVk25ZvTkU

[EE_]

Bail-in is the new Bail-out

The First "Bitcoin Bail-In": All Bitfinex Users To Lose 36% In "Shared Loss" After Historic Hack
by Tyler Durden
Aug 7, 2016 10:58 AM

Last week's sharp, 30% plunge in the price of bitcoin (and its latest competitor, ether), after news hit that 119,756 bitcoins, or about $70 million, had been stolen from the Hong Kong-based bitcoin exchange Bitfinex, demonstrated once again the biggest risk with digital currencies: despite claims to the contrary, outside hacks remain a key threat and risk to anyone holding (obviously, we use the term loosely) digital currencies.

Now, adding insult to injury for those who "held" their BTC at the hacked exchange, Bitfinex announced it would pull a page right out of Europe's bank resolution mechanism, saying that all of its users will lose 36% of their deposits after it concluded its review the massive hack, in what is set to be the first ever "bitcoin bail-in."

And, in pulling another page out of Europe, Bloomberg adds that to compensate its customers, Bitfinex users would receive (largely worthless) tokens that may later be redeemed or exchanged for shares in its parent company. Following the announcement, bitcoin climbed to $599 in early trading on Sunday. The virtual currency had dropped 12% to $577.23 in the week through Friday, its largest weekly decline since June, however has now recovered all of its sharp drop which had seen its price tumble as low as $470 on August 2.

“After much thought, analysis, and consultation, we have arrived at the conclusion that losses must be generalized across all accounts and assets,” the exchange wrote in a blog post on Saturday. “In place of the loss in each wallet, we are crediting a token labeled BFX to record each customer’s discrete losses.” Good luck monetizing said "token."

The blog post ended as follows:

Thank you for your continued patience and for the many generous offers of support that we have received over the last several days. Notwithstanding this attack, we continue to believe in the possibilities associated with bitcoin. We will continue to update our customers and the public as and when we can.
According to Bloomberg, a representative of the exchange wrote on Reddit that the 36% loss “applies to all assets across the site, so everyone.” The exchange previously said losses would only apply to users who either had bitcoin deposited at the exchange or who were in the process of lending U.S. dollars for margin trading.

Following Tuesday's Bitfinex hack, the exchange closed down trading, withdrawals and deposits and said it was cooperating with law enforcement and would update the public after its investigation. In the latest blog post, it said it will reopen with limited functionality in the next day or two. Bitfinex was the largest exchange for U.S. dollar-denominated transactions over the past month, according to bitcoincharts.com.

As we predicted one year ago, the main reason for the surge in bitcoin has been the explosion of Chinese users of the virtual currency, who have rushed into bitcoin as one of the few remaining options to bypass Chinese capital controls on monetary outflows. As such the Bitfinex hack, impacting numerous Chinese participants, has not come as much of a surprise: what better way to limit trader euphoria for an asset that has soared nearly 200% in the past year than by "forcing" a loss of nearly a third on everyone involved.

It remains to be seen if this latest bail-in "glitch" will temper Chinese euphoria for the digital currency; considering the sharp rebound which has practically filled the entire hack "gap"...



... hackers will have to work overtime to temper the infamous Chinese enthusiasm for buying more of things that go from the lower left to the upper right.
http://www.zerohedge.com/news/2016-08-07/first-bitcoin-bail-all-bitfinex-users-lose-36-shared-loss-after-historic-hack

[crimethink]

If you don't hold it, you don't own it. I'm not fan of electronic currency. I may be losing out on an opportunity but I can sleep at night

Bitcoin has very limited utility in a warfare situation.

As for general purposes, it's sheer idiocy to claim that replacing Jewish electronic "money" with Bitcoin electronic "money" is "to our benefit."

The only money that means something is what you can eat, defend with, care for wounds with, or something that will always be able to buy those things with. Bitcoins don't qualify.