×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

Bitcoin Exchange Mt.Gox Suffers Serious Attack, Instawallet Offline

timothy posted 1 year,18 days | from the which-fed-bank's-ip-address? dept.

Bitcoin 388

Bruce66423 writes "The BBC reports that Mt.Gox, the main exchange dealing with Bitcoins, has been attacked, and other resources are off line. A scary reminder of how insecure ALL money is in the computer age..." Also at TechWeekEurope. A message at bitcoin storage service Instawallet's site begins "The Instawallet service is suspended indefinitely until we are able to develop an alternative architecture. Our database was fraudulently accessed, due to the very nature of Instawallet it is impossible to reopen the service as-is."

cancel ×
This is a preview of your comment

No Comment Title Entered

Anonymous Coward 1 minute ago

No Comment Entered

388 comments

Is it? (5, Insightful)

paiute (550198) | 1 year,18 days | (#43357941)

"A scary reminder of how insecure ALL money is in the computer age...."

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

Re:Is it? (5, Funny)

Anonymous Coward | 1 year,18 days | (#43358043)

And if you did trust it on a server somewhere, would that server be "Magic The Gathering Online Exchange"?

(Or are we supposed to forget that that's what "MtGOX" stands for?)

Re:Is it? (-1)

Anonymous Coward | 1 year,18 days | (#43358289)

Mt.Gox? More like Mt.Cocks amirite?!?

Re:Is it? (2)

Archangel Michael (180766) | 1 year,18 days | (#43358385)

I don't trust MTGOX, and I have no illusions of trust. However many people trust the government. The real question is, is the illusion of trust better than the reality of not trusting anyone.

Caveat Emptor.

Re:Is it? (4, Interesting)

lgw (121541) | 1 year,18 days | (#43358653)

When I buy a share of stock or a corn future, my need to trust the government is minimal. I need to trust the exchange. And the big exchanges have an excellent track record - the exchange rules protect against 400+ years of dirty tricks by participants, and the likes of MtGox have a very long way to go. Attacking the database is just the most obvious and straightforward approach; there are so many ways to participate fraudulently in an exchange, or corner the market, or so many other dirty tricks that become rewarding if bitcoin really takes off.

Re:Is it? (1)

slashmydots (2189826) | 1 year,18 days | (#43358617)

The bought the domain name, dumbass. It's now K K Tibanne running it. That's like making fun on pets.com because of 15 years ago or whatever.

Re:Is it? (1)

ackthpt (218170) | 1 year,18 days | (#43358109)

"A scary reminder of how insecure ALL money is in the computer age...."

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

The big sack of pennies under my bed is as secure as ever.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358349)

Stick a hundred or two of them in a sock, it'll help secure them.

I mean, beating burglars off with a heavy sack would be harder.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358477)

Stick a hundred or two of them in a sock, it'll help secure them.

I mean, beating burglars off with a heavy sack would be harder.

Sounds like you have some sort of sexual fetish for home invaders and coins.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358117)

Slashdot has been shilling for BitCoin for quite a while now, it shouldn't come as a surprise that they'd play soft-ball when it comes to criticizing it.

Re:Is it? (1)

westlake (615356) | 1 year,18 days | (#43358123)

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

I hate to break this to you, but your insured deposits aren't held as coins in an outsized piggy bank like Scrooge McDuck's Money Bin. They exist only as entries in an electronic ledger.

Re:Is it? (2)

Hentes (2461350) | 1 year,18 days | (#43358197)

There are many degrees of computer security, just like in real life. When you deal with lots of money, you want security that matches with the risk. Banks can do that.

Re:Is it? (1)

chill (34294) | 1 year,18 days | (#43358241)

Irrelevant. The guarantee is by first the bank then the U.S. Government, regardless of how the funds are recorded.

In the case of Mt. Gox, it is an exchange and not a bank. The only threat would be if you attempted to exchange for a different currency and couldn't because of the DoS. Just like what happened to Bank of America earlier.

As for the wallet -- they're fucked.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358281)

You obviously do not work with money or banking software. Its not a ledger, its a transaction trail. And its not in "an" its in several.

Re:Is it? (3, Interesting)

lgw (121541) | 1 year,18 days | (#43358489)

You obviously do not work with money or banking software. Its not a ledger, its a transaction trail. And its not in "an" its in several.

For transactions that stay in Bitcoins, the entire network tracks every transaction (well, more than half of it has to). The same goal is served without a central authority. The privacy implications are more disturbing than the prospect for fraud.

However, the exchanges are a different matter. Just like those stupid mortgage derivatives, there's a real need for a regulated exchange here. Note that most of the regulations involved in trading e.g. corn at the CME aren't government regulations, they're market rules. If you want to buy or sell at the CME, you follow those rules, if not, perhaps there's another market that works the way you'd like.

The CME (and the other big markets, but that's the main one for the US) is really good at writing rules that protect traders from crap like having the exchange hacked, or any of the other crap that the likes of Goldman Sachs have come up with over centuries of trying to hack the system.

My biggest worry with bitcoins is what happens when Goldman et al discover there's money to be made by manipulating that market, and have nothing to stop their centuries-old bag of tricks.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358347)

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

I hate to break this to you, but your insured deposits aren't held as coins in an outsized piggy bank like Scrooge McDuck's Money Bin. They exist only as entries in an electronic ledger.

I hate to break this to you, but if BitCoin goes belly up, you're money to gone forever.

The more I learn about it, the more it sounds like a very sophisticated scam. And don't get me started on that whole "mining" horseshit - "making" money by running algorithms?!? Please.

Full faith and credit (2)

sjbe (173966) | 1 year,18 days | (#43358449)

I hate to break this to you, but your insured deposits aren't held as coins in an outsized piggy bank like Scrooge McDuck's Money Bin. They exist only as entries in an electronic ledger.

Yes, and? Those insured deposits are backed by the full faith and credit of the United States government and the bank is liable for their security. Bitcoins enjoy none of the same protections. If someone wants to use bitcoin and understands the amount of risk they are assuming then I have no quarrel with them but let's not pretend the amount of risk is remotely comparable.

Re:Full faith and credit (1)

Anonymous Coward | 1 year,18 days | (#43358593)

Right, in the US it depends where you keep your money, but the FDIC, NCUA or SIPC would cover the money up to a certain amount. And for most people that amount is far above what they're likely to have at any given time.

What's more, the risks you face at a regular bank are relatively well known, you don't need to also deal with the risks that come from speculation and insecure, uninsured exchanges.

Re:Full faith and credit (1)

LaggedOnUser (1856626) | 1 year,18 days | (#43358677)

Within the past century, 95% of the purchasing power of the US dollar has been taken away by inflation. Exactly how safe do you think the US dollar is again?

Re:Is it? (1)

DragonWriter (970822) | 1 year,18 days | (#43358729)

I hate to break this to you, but your insured deposits aren't held as coins in an outsized piggy bank like Scrooge McDuck's Money Bin. They exist only as entries in an electronic ledger.

They also exist in the form of various transaction documents and balance statements I can present to a court with jurisdiction over the bank in question as evidence of the existence of the deposits.

Re:Is it? (1)

Anonymous Coward | 1 year,18 days | (#43358143)

Huh? Bitcoin is still rolling along just fine. MtGox is an exchange. The coins are still being transacted just fine.

This is my biggest problem with people not understanding this technology. *Sites* have been hacked and DDoS'd, so far the Bitcoin network itself has been much more reliable. If you're into security, I'd highly recommend looking through the specs. It's an incredibly beautiful piece of engineering whether or not you are using it.

Re:Is it? (4, Interesting)

betterunixthanunix (980855) | 1 year,18 days | (#43358299)

If you're into security, I'd highly recommend looking through the specs. It's an incredibly beautiful piece of engineering whether or not you are using it.

I looked at the specs, in great detail. What I saw is a system that uses cryptography but which is not secure under the notion of "security" that cryptographers use. The effort required for a successful double-spending attack on Bitcoin scales linearly with the effort required to use Bitcoin; this is worthless as far as cryptographic security is concerned. It is also troubling that the Bitcoin "security proof" only rules out a single attack strategy. Usually we want security proofs to rule out *all* theoretically feasible attacks, even those that we do not know of.

Re:Is it? (4, Insightful)

lgw (121541) | 1 year,18 days | (#43358579)

As I understand it, a successful double-spending attack on Bitcoin requires controlling more than 50% of the computing power participating in the transaction validation network at the time you make the transaction. As that is the same thing as the bitcoin mining network, and that has gone to custom ASICs now, that's a pretty impressive obstacle. I don't think even the NSA has that kind of horsepower any more (though if anyone does, it's them).

If there's some flaw you see in the implementation of that, it's a really interesting flaw and you should publish.

Usually we want security proofs to rule out *all* theoretically feasible attacks, even those that we do not know of.

You contradict yourself there. Everything is vulnerable. Everything from AES to SHA-x relies on the premise that no one has come forward with a weakness, and lots of smart people have looked, and that's as good as it gets. You can't prove a negative.

Re:Is it? (1)

Wonko the Sane (25252) | 1 year,18 days | (#43358607)

Right. Since you've done such a thorough analysis of the method Bitcoin uses to prevent double spending, you can explain it in your own words and point out specifically where the weaknesses are?

Re:Is it? (1)

slashmydots (2189826) | 1 year,18 days | (#43358655)

For all the rest of you that might believe that nonsense, I know the protocol inside and out and that's all bullshit and horribly inaccurate. He has no idea how the protocol actually works. It has nothing to do with reversing encrypted data since that will do nothing for you.

So kill it (0)

Anonymous Coward | 1 year,18 days | (#43358735)

As others have said, you can make your cred by publishing. If you want people to think you're a spook, well. I've seen that before.

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358603)

Uhhh.

When 99% of trading in BitCoin still require exchanging BitCoins into local currency at some stage, I'd expect biggest exchange being down to _somewhat_ affect BC economy.

Kinda like NYSE stopping for a day will, too, mean "Dollar is still rolling along just fine", but it will do a nice trick with exchange rates.

Re:Is it? (1)

slashmydots (2189826) | 1 year,18 days | (#43358633)

Amen to that. People don't realize the protocol is absolutely, 100% perfectly fraud-proof. It is designed to be impossible to forge a bad block or fake a transaction or gain ownership of coins you don't own. The only way to actually do it is to outprocess the entire rest of the network, which is impossible.

Re:Is it? (1)

Anonymous Coward | 1 year,18 days | (#43358267)

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

Is it any safer there than a Cypriot bank?

Re:Is it? (0)

Anonymous Coward | 1 year,18 days | (#43358291)

Bitcoin doesn't have to reside on a server somewhere. You store your keys (bank accounts) on your own computer, password-encrypted, with backups. It is more secure than money in someone else's bank, somewhere.

Re:Is it? (2)

Archangel Michael (180766) | 1 year,18 days | (#43358355)

That depends on if the US government can confiscate money held in banks like what happened in Cyprus, or not. The question is, do you trust government to honor its promises. Ask the Native Americans how the government honors its treaties.

"I'm altering the deal, pray I don't alter it further"

Re:Is it? (1)

bill_mcgonigle (4333) | 1 year,18 days | (#43358357)

I applaud the creation of Bitcoin, but really, would you trust your $10,000 more on a server somewhere or in an FDIC-covered bank?

Remember, the FDIC has about $25B in treasury notes (not cash, that's long gone) in its fund to cover about $10T in deposits, and most of the insured banks have very low ratios (perhaps 10% cash-on-hand at most). If there's ever a bank run, the FDIC can't stop it.

What the FDIC does is give the banking class license to invest wildly, without their customers caring at all what their banks do. Classic moral hazard.

The thing bitcoin has going for it is that nobody can double the amount of money in circulation and make the value of your coins worth half in turn. Of course it's really volatile, so while good for money transfer, don't store too much of your wealth in it long term.

For wealth storage, there's little subsitute for real assets these days.

The purpose of the FDIC (4, Insightful)

sjbe (173966) | 1 year,18 days | (#43358493)

Remember, the FDIC has about $25B in treasury notes (not cash, that's long gone) in its fund to cover about $10T in deposits, and most of the insured banks have very low ratios (perhaps 10% cash-on-hand at most). If there's ever a bank run, the FDIC can't stop it.

The FDIC doesn't have to stop it. The purpose of the FDIC is to keep bank runs from starting in the first place, not to be able to back every dollar deposited. The FDIC is there to reassure people that even if their particular bank is having issues that they still will be able to get to their money because the government is there to back them up. Bank runs start because people think they cannot get to their money. If the money is insured there is less chance of them doing this.

Re:Is it? (1)

hedwards (940851) | 1 year,18 days | (#43358645)

This is ignorant hogwash, the FDIC can and does take control of banks before they fail. When we say that a bank failed, it usually means that they've dripped below their margin requirements and are at risk of failure. The FDIC swoops in over night, not unlike spies actually, and assumes control of the operation before even the staff know that the bank was going to be seized.

The reason for this is because it prevents a run on the bank and lessens the likelihood of the FDIC having to pay out non-trivial sums of money. What's more, there are almost certainly actuarial tables that dictate how much money they need to cover the total. If it really came to where they had to pay out $10tn to bail out the entire industry, we'd have bigger worries on our hands.

Re:Is it? (1)

slashmydots (2189826) | 1 year,18 days | (#43358605)

Somewhere? K K Tibanne Corp in Japan. And they already got hacked once so you'd think they'd have gotten their shit together. This may have been a DDOS or something stupid like that though since the price of BC is freaking $133! That's like 50% up from 2 weeks ago.

"...ALL money is in the computer age." (1)

Anonymous Coward | 1 year,18 days | (#43357945)

I just checked. The cash in my wallet remains un-hacked.

Re:"...ALL money is in the computer age." (2)

emho24 (2531820) | 1 year,18 days | (#43358115)

Yet if the cash in your wallet represents anything more than chump change, expect it to be "hacked" the next time you run into the authorities.

Re:"...ALL money is in the computer age." (1)

ElectricTurtle (1171201) | 1 year,18 days | (#43358261)

Yeah, never mind that currency makes up for less than 10% of most developed economies. It's even common to be under 5% in Europe.

Re:"...ALL money is in the computer age." (2)

fustakrakich (1673220) | 1 year,18 days | (#43358367)

The cash in my wallet remains un-hacked.

No, it doesn't, unless you want to ignore inflation.. The dollars in your wallet are losing value every day.

A reminder of how insecure ALL money is? (3, Insightful)

nysus (162232) | 1 year,18 days | (#43357949)

Uh, no. Somehow I sleep a little better knowing my money is backed up by the FDIC if I keep it in a real bank.

Re:A reminder of how insecure ALL money is? (1)

Anonymous Coward | 1 year,18 days | (#43357991)

"Look, would you people stop trivially attacking our exchanges like that?!? We're TRYING to make a point as to how superior Bitcoin is to legacy currency, and you're not helping us! Geez!"

Re:A reminder of how insecure ALL money is? (1)

Anonymous Coward | 1 year,18 days | (#43358061)

The people in Cyprus used to sleep well too.

Re:A reminder of how insecure ALL money is? (0)

Anonymous Coward | 1 year,18 days | (#43358079)

They're still sleeping just fine; no money was taken from accounts under the 100,000 euro insurance limit.

Anything over 100,000 euros was uninsured, just as anything over $250,000 is uninsured in the US. Those depositors were generally not "people in Cyprus" but rather "people in Russia with money in Cyprus".

Re:A reminder of how insecure ALL money is? (4, Informative)

Wonko the Sane (25252) | 1 year,18 days | (#43358133)

Those depositors were generally not "people in Cyprus" but rather "people in Russia with money in Cyprus".

No, the Russians were all tipped off ahead of time, and were able to withdraw their money via overseas branches that remained open during the freeze in Cyprus. The only people who were affected were regular people and small businesses.

Re:A reminder of how insecure ALL money is? (2)

prisoner-of-enigma (535770) | 1 year,18 days | (#43358181)

Anything over 100,000 euros was uninsured, just as anything over $250,000 is uninsured in the US. Those depositors were generally not "people in Cyprus" but rather "people in Russia with money in Cyprus".

And this makes the people who were subjected to government-authorized robberies sleep better at night...how exactly? When the government can arbitrarily decide to take your funds, does it really matter where thy put the dollar/euro limit at? This should terrify everyone.

Re:A reminder of how insecure ALL money is? (1)

Anonymous Coward | 1 year,18 days | (#43358673)

Anything over 100,000 euros was uninsured, just as anything over $250,000 is uninsured in the US. Those depositors were generally not "people in Cyprus" but rather "people in Russia with money in Cyprus".

And this makes the people who were subjected to government-authorized robberies sleep better at night...how exactly? When the government can arbitrarily decide to take your funds, does it really matter where thy put the dollar/euro limit at? This should terrify everyone.

It is interesting when government *not* bailing out failing banks with other taxpayers money is "government-authorized robberies". The bank is bankrupt. The available values left after the bankrupt business is not enough to cover more than around half the value of large deposits (exactly how much is not clear yet, have varied). The other half "disappears", nobody are stealing it, the money doesn't exist anymore, the bank has lost them. The government is intervening to secure that people with smaller deposits are shielded to a larger degree than the really large deposits, and secure the insured amount per depositor (100.000 EUR per person)

Re:A reminder of how insecure ALL money is? (1)

roman_mir (125474) | 1 year,18 days | (#43358541)

Without the 10 Trillion Euro bailout by the rest of EU nobody would have 1 red cent in Cyprus. While the gov't promised to insure deposits of up to 100K Euro, the reality is that there is no such insurance, there is no money.

In USA in a very perverted way the Too Big To Fail will be bailed out again with the tax payer money (actually with everybody's money due to inflation) when the Fed will just print and give the money to FDIC to 'cover losses'.

The reality is that Cyprus had no insurance, neither does USA.

25Billion in FDIC 'assets' (Treasuries are not assets), to cover 10 Trillion USD of bank deposits. If that's not a scam of massive proportions then I don't know anything.

Re:A reminder of how insecure ALL money is? (2)

hedwards (940851) | 1 year,18 days | (#43358693)

It's not a scam.

The way the FDIC works is that they monitor the financials of all the banking institutions that are covered by them. And they require that the banks hold a certain amount of cash in reserve at all times in order to ensure that they can cover the funds that they've loaned.

The FDIC itself shuts banks down and sells them to other banks prior to them getting into serious trouble. So, the end result is that the FDIC rarely has to pay anything and when it does, most of the money is still in the bank.

$25b is a lot of money, but you have to realize that in order for it to owe $1tn or more that they would have to miss a ton of banks that weren't complying with the law, and that's highly unlikely. What's more, $10tn would require a complete collapse of the system, at which point there are bigger fish to fry. Such as finding fish to fry because you're starving.

Re:A reminder of how insecure ALL money is? (0)

Anonymous Coward | 1 year,18 days | (#43358715)

25Billion in FDIC 'assets' (Treasuries are not assets), to cover 10 Trillion USD of bank deposits. If that's not a scam of massive proportions then I don't know anything.

Well, I don't know about you not knowing anything, but it's pretty clear you've never read anything about economics or banking or why the fractional reserve system works the way it does.

Re:A reminder of how insecure ALL money is? (1)

Wonko the Sane (25252) | 1 year,18 days | (#43358091)

I'm sure the customers of Laiki Bank were highly satisfied with their government-provided deposit insurance too, right up until they lost all access to their funds for a few weeks, and lost the majority of their balances [bitcointalk.org]. I'm sure the people who aren't getting paid because the company they work had payroll funds frozen are singing the praises of deposit insurance right this minute.

Re:A reminder of how insecure ALL money is? (1)

Anonymous Coward | 1 year,18 days | (#43358219)

Of course it's completely proper to compare the United States to a tiny island that doesn't print its own currency with a banking system whose balance sheets exceeded 800% of GDP and that decided to invest highly in Greek sovereign debt.

Re:A reminder of how insecure ALL money is? (2)

Wonko the Sane (25252) | 1 year,18 days | (#43358285)

That tiny island is probably more solvent than the United States. Our balance sheets only look better because of a complete lack of transparency and honest accounting.

Re:A reminder of how insecure ALL money is? (1)

Jeremi (14640) | 1 year,18 days | (#43358597)

That tiny island is probably* more solvent than the United States.

* note that "probably" in the above sentence means "I have no idea what I'm talking about"

Re:A reminder of how insecure ALL money is? (1)

camperdave (969942) | 1 year,18 days | (#43358467)

Why should they print their own currency, when they can farm it out for less? Lots of countries do.

Re:A reminder of how insecure ALL money is? (1)

hedwards (940851) | 1 year,18 days | (#43358725)

Because the power to create currency needs to be held by the government that controls the regulatory and tax structure. That's something that the Europeans are finding out the hard way. The reason being that if you have multiple nations using the same currency, but without a single tax and regulatory structure to cover it, you wind up with situations like this where somebody gets in trouble and everybody else has to help fix it.

I'm not really sure why Europeans have such a hard time with this. I don't personally like having to constantly subsidize the rural states, but they use the same currency and are in the same economic block as us, so we ultimately have to pay for their inability to fund their own lifestyles. It sucks, but that's how that ultimately works.

Re:A reminder of how insecure ALL money is? (5, Insightful)

prisoner-of-enigma (535770) | 1 year,18 days | (#43358209)

Uh, no. Somehow I sleep a little better knowing my money is backed up by the FDIC if I keep it in a real bank.

And, as recently demonstrated by Cyprus, if the government arbitrarily changes the rules ex post facto and decides they're going to take your money "because we need it," how well do you sleep? You sleep well thinking the rules of the game can't be changed. They can. They are. This is a terrifying precedent.

Re:A reminder of how insecure ALL money is? (2)

Steve Hamlin (29353) | 1 year,18 days | (#43358631)

I trust that the U.S. Government won't expropriate my bank account more than I trust that private Bitcoin servers won't get hacked.

Sleeping well is relative.

Re:A reminder of how insecure ALL money is? (1)

ackthpt (218170) | 1 year,18 days | (#43358237)

Uh, no. Somehow I sleep a little better knowing my money is backed up by the FDIC if I keep it in a real bank.

I'm more comfortable with having a limited amount of my assets in silve or gold coinage - that stuff will pretty much always have value.

And regarding Bitcoins, this not-so-old poll [slashdot.org] is relevant.

Re:A reminder of how insecure ALL money is? (0)

Anonymous Coward | 1 year,18 days | (#43358411)

you only keep the bitcoins in the exchange if you want to transfer to convert them to some other currency.
I am sure no one with lots of bitcoins keeps them in an exchange they all run their own wallets. I got bitcoins, and I hope that I will never have to exchange I like them to stay bitcoins, and I always look for services that accept bitcoin. You complaining about FDIC just sounds like you don't know how it works. I had to google FDIC stupid muricans think everyone knows their acronyms.

Re:A reminder of how insecure ALL money is? (1)

roman_mir (125474) | 1 year,18 days | (#43358485)

Uh, no. Somehow I sleep a little better knowing my money is backed up by the FDIC if I keep it in a real bank.

- I don't want to cause insomnia here, but 10 Trillion USD worth of bank credit (so called 'deposits') are covered with 25 Billion USD worth of Treasury notes that FDIC has as 'assets' (which are of-course also a liability, Treasury notes need to be sold first).

25 Billion of debt to cover 10 Trillion of debt. Cyprus salutes you.

Yet the value of BitCoin keeps on rising (2, Funny)

Anonymous Coward | 1 year,18 days | (#43357967)

Why does it smell like tulips in here....

BitCoin apologists (1, Insightful)

93 Escort Wagon (326346) | 1 year,18 days | (#43357973)

This is NOT a "reminder of how insecure all money is in the computer age". This is a reminder of what a crappy job BitCoin's developers have done. Did you somehow miss the part about the need to develop an alternative architecture before this can be reopened?

Re:BitCoin apologists (0, Insightful)

Anonymous Coward | 1 year,18 days | (#43358103)

It's more of "A scary reminder of IT'S NOT OUR FAULT IT'S NOT OUR FAULT LOOK THEY DID IT TOO IT'S NOT OUR FAULT WAAAAAAH". Part of the Bitcoin zealots' never-ending quest to prove that Bitcoin is completely fucked up in the same ways real currency is, and that makes Bitcoin superior*!

*: I never said zealots were big on logic and reason.

Re:BitCoin apologists (2)

Umuri (897961) | 1 year,18 days | (#43358131)

Relevant xkcd to rant below: http://xkcd.com/932/ [xkcd.com]

So please, explain to us how a third party's online wallet service is now a fundamental flaw in bitcoin itself? They made a server that did data management for the user, and thought they had security in place such that their data was unacessible without the proper password. They then were proven wrong. So now they need a new method of storing it (architecture) that is secure.

For the obligatory car analogy, this is like you saying a certain car brand sucks at security because an aftermarket mechanic installs hidden compartments in it, and then the compartment gets broken into because it has a shitty lock. Now the mechanic is out of the compartment installing business until he finds a better lock to put in.

Re:BitCoin apologists (2)

JesseMcDonald (536341) | 1 year,18 days | (#43358187)

This has nothing to do with "BitCoin's developers". The "alternative infrastructure" comment applies exclusively to InstaWallet, a provider of "online wallets", which was hardly a major player to begin with, and Mt. Gox wasn't "hacked", they were the target of a DDoS attack which made it difficult to access their web site. That's inconvenient if you rely on them for exchanging BTC and USD and need to do so in a hurry, but there are other exchanges available, and everyone's balances on and off the exchange are still perfectly secure. At no point did either incident affect the actual Bitcoin network.

Terminology (1)

Anonymous Coward | 1 year,18 days | (#43358273)

The word "apologist" implies that something wrong or immoral has taken place, and that the "apologists" are trying to justify it. Therefore, it makes no sense to use the term "apologist" with regards to bitcoin, since bitcoin is 100% voluntary with respect to all parties involved, and therefore nothing wrong or immoral has taken place.

The word you are looking for could be "supporters", "fans", or "customers", but definitely not "apologists".

Re:BitCoin apologists (0)

Anonymous Coward | 1 year,18 days | (#43358661)

By that logic, if a US bank or exchange service provider has poor security then that means the dollar is a poor substitute for money.

Re:BitCoin apologists (1)

slashmydots (2189826) | 1 year,18 days | (#43358667)

This is NOT a "reminder of how insecure all money is in the computer age". This is a reminder of what a crappy job BitCoin's developers have done. Did you somehow miss the part about the need to develop an alternative architecture before this can be reopened?

The bitcoin developers didn't design MTGox.com or pick the hosting company, genius. They made the protocol, which has thus far been perfect.

Throwback (0)

Anonymous Coward | 1 year,18 days | (#43357981)

I'm not sure why, but I've always had an awful feeling about bitcoins. I guess I can't get on board with a system that hands out money to people for doing....basically nothing. But then again, I guess you can find that in pretty much every country already anyways.

Can we just go back to trading chickens for yokes?

Re:Throwback (1)

jones_supa (887896) | 1 year,18 days | (#43358375)

That's just the mining part, which is in my understanding necessary for the system to operate. You shouldn't feel awful about that. Bitcoins can still be used like any other currency.

Worried? (-1, Flamebait)

Wowsers (1151731) | 1 year,18 days | (#43357985)

Bitcoin attacked? Sounds like the central bankers are worried people turning away from their paper rubbish with their unlimited quantitative easing.

Re:Worried? (1)

Big Hairy Ian (1155547) | 1 year,18 days | (#43358169)

It is a case of over statement. bear in mind there's a very long history of bank robberies some of which took advantage of infrastructure that wasn't up to scratch (Ronny Biggs & the great train robbery springs to mind). So wow somebody robbed a bank and another bank branch has closed because they made their safe out of tissue paper.

Move along there's nothing to see here!

Re:Worried? (0)

Anonymous Coward | 1 year,18 days | (#43358249)

Everyone knows that an inherently deflationary currency created by an anonymous hacker, backed the difficulty of performing computational hashes is a solid foundation for the next world economy.

Bitcoins irrelevant USD. Paypal 30 times as large (2)

raymorris (2726007) | 1 year,18 days | (#43358369)

The people running the central banks don't know a bitcoin from a cupcake and don't care. There are over 100,000 times as many dollars as there are Bitchcoins. In ten years, PAYPAL might be worried about bitcoin. PayPal is 30 times as large as bitcoin (by transaction volume), so if bitcoin got 20 times as popular it would be real competion for PayPal.

For the US dollar? The Federal Reserve is about as concerned about bitcoins as Coca Cola is concerned about some kid's lemondade stand. The Fed IS concerned about people switching to the Euro because currently about half of all international trade is in USD, but much is moving to the Euro. That reduces the amount of USD governments and institutions keep in reserve, which are effectively free loans to the fed. (They get to sell dollars which get locked away, without inflating the market.) So the euro matters, bitcoins are such a tiny, tiny market that big bankers hardly notice they exist.

Hyperbole is the worst form of exageration (0)

Anonymous Coward | 1 year,18 days | (#43358009)

A scary reminder of how insecure ALL money is in the computer age...

All, for sure, but some more insecure than other.

Captcha: Stimuli

Dwolla Also Hit (4, Insightful)

eldavojohn (898314) | 1 year,18 days | (#43358049)

Also Dwolla was down for two days [techcrunch.com] but appears to be back up as they appeared to have worked a deal with CloudFlare. Mt. Gox uses Prolexic so this shouldn't affect them, right? Right? Accessing the database of Instawallet sounds like a total fail though.

A scary reminder of how insecure ALL money is in the computer age...

Really? My Celtic ring money is still fully intact around my wrist and still worth the silver it's made out of. All currencies have their ups and downs. Some benefits are double edged swords (just ask Renminbi traders). Nice editorial though -- the services surrounding BitCoin are clearly infantile and only now are getting DDOS protection.

My credit union offers two factor authentication. Could a Bitcoin exchange do the same? You bet. But they haven't. The fact is that it's easier to find legit and robust exchanges and institutions in USD than BitCoin.

Re:Dwolla Also Hit (3, Informative)

Kiwikwi (2734467) | 1 year,18 days | (#43358147)

If you'd get off your horse for a moment, you might realize that MtGox offers two-factor authentication and has for a long time.

Re:Dwolla Also Hit (0)

Anonymous Coward | 1 year,18 days | (#43358275)

But it's an amazing horse! http://www.youtube.com/watch?v=bjjuc5v5RoQ

Re:Dwolla Also Hit (0)

Anonymous Coward | 1 year,18 days | (#43358699)

BTC naysayers don't bother with facts, they shoot first and don't ask questions or research!

Re:Dwolla Also Hit (1)

dubdays (410710) | 1 year,18 days | (#43358305)

My credit union offers two factor authentication. Could a Bitcoin exchange do the same? You bet. But they haven't. The fact is that it's easier to find legit and robust exchanges and institutions in USD than BitCoin.

I believe you're correct in that the exchanges don't use two factor authentication. However, my Bitcoin wallet is an online one (yeah, not so secure, but I only do a little bit of mining...less than $50 in there right now) that definitely does use two factor authentication through the Authy [google.com] app. Quite simple really, and the exchanges should definitely use something like this.

target (5, Interesting)

roman_mir (125474) | 1 year,18 days | (#43358053)

Bitcoin exchanges are a target right now at the current exchange rates, but I was thinking just a little while back [slashdot.org], isn't it strange that somebody who released [gmane.org] the original protocol is unknown and wishes to stay anonymous? I thought about that for a little bit, there are a number of possibilities. Of-course somebody who had the original idea could run the hash generation for a much longer time before anybody started doing it as part of a mining (proof of work) network. I don't know, it's hidden in plain sight [bitcoin.it]

This feature is then used in the Bitcoin network to secure various aspects. An attacker that wants to introduce malicious payload data into the network, will need to do the required proof of work before it will be accepted. And as long as honest miners have more computing power, they can always outpace an attacker.

- good, what if somebody had a much longer stretch of time to work out the answers before they could even become questions? It's not like those transactions are random.

What other motives can somebody have to release a protocol like this one potentially to be used by millions of people who see this as a way to make money? Giving people incentives to come up with faster SHA generators? Somebody who wants to break encryption mechanisms by generating huge amounts of SHA codes against various data?

I think without actually getting into the source code it's impossible to read the answers to any of these questions, so maybe that's the next step, read the source code.

InstaTheft (3, Interesting)

Anonymous Coward | 1 year,18 days | (#43358073)

Was InstaWallet attacked? Or is that what they want you to believe while they abscond with all the untraceable bitcoins?

Sorry, regular money is more secure than bitcoin. (0)

Anonymous Coward | 1 year,18 days | (#43358097)

The paypal and visa/mastercard denial of service attacks did not cause a large disruption of the ability to process payments. The hacking of credit card merchant accounts do not cause any disruptions in the currency markets in which they are based. If your credit cards or bank account gets hacked you will not be liable for more than $50 dollars damage. With bitcoin all it takes is one exchange to get hacked, or one large wallet to get hacked and the currency falls down like a house of cards. When your bitcoins get stolen you are SOL and you will likely never recover your loss.

Bruce66423 (0)

Anonymous Coward | 1 year,18 days | (#43358111)

loves his Nerdcoins! *nom* *nom* *nom*!

Insecure? Yeah right. (-1)

Anonymous Coward | 1 year,18 days | (#43358119)

"A scary reminder of how insecure ALL money is in the computer age..."

No, it's a scary reminder about how fake money used by perverts and potheads is unstable. Gee, who'd have thought currency for criminals would be fraught with problems?

I hope Bitcoins go away forever. They just enable crime.

Old news? (5, Informative)

prisoner-of-enigma (535770) | 1 year,18 days | (#43358137)

This is semi-old news. Mt.Gox has been under attack for at least a couple of days but they appear to be handling it pretty well. I haven't noticed any problems with using them at least. Trades might be taking a tad longer but nothing big that I can see.

Instawallet, on the other hand, crumbled at least a day or two (I read about it early yesterday morning). Their problem had nothing fundamental to do with BTC but more to do with the unique way Instawallet did business with (I believe) greater anonymity. The whole "we gotta rearchitect this thing" press release was that their fundamental way of doing business made them uniquely targetable by fraudsters, thus they gotta figure out something new.

Money is not secure, period (1)

Anonymous Coward | 1 year,18 days | (#43358151)

Look at the situation in Cyprus - large foreign investors are being "robbed" of 60-80% of their deposits in banks. And if push comes to shove, you better believe Obama, or whoever else is in power in the US at the time, will not hesitate to do the same.

Re:Money is not secure, period (2, Interesting)

Anonymous Coward | 1 year,18 days | (#43358329)

The US cannot possibly end up like Cyprus. If it does, it means the global economy has collapsed and ALL forms of currency - save for bulets and possibly bottle caps - is worthless. Bitcoin backers demonstrate their fundamental lack of understanding of the economy on a daily basis.

Why leave it there?!?! (0)

Anonymous Coward | 1 year,18 days | (#43358231)

Keep the hashes for your cashes backed up on several local and remote systems, its not gold or paper why do you need it on a server at mtgox or anywhere that it can be en-masse raided?
When it is time to spend transfer directly as the system is intended, nearly speed of light. Mtgox is supposed to be an exchange so you can trade in or out of $US, why bank a few kb of hash data worth real money there?

This is NOT about Bitcoin (0)

Anonymous Coward | 1 year,18 days | (#43358245)

What is important here is that this is NOT about any would-be insecurities of Bitcoin. This is entirely about poor security practices of websites and their users. Store your Bitcoins on your computer, password-encrypted, with backups, that way you won't lose them even if someone steals your computer.

Not exactly. (1)

Westwood0720 (2688917) | 1 year,18 days | (#43358263)

"A scary reminder of how insecure ALL money is in the computer age..."

Which is why I choose to invest in gold, brass, and lead.

is it me or bitcoin exchanges keep getting hacked? (2, Insightful)

youn (1516637) | 1 year,18 days | (#43358395)

there are so many in the news, it is difficult to keep track

Re:is it me or bitcoin exchanges keep getting hack (1)

slashmydots (2189826) | 1 year,18 days | (#43358679)

3 exchanges were ever hacked in history, 2 were MTGox lol. But this doesn't sound like the first hack. It sounds like it just knocked them offline. The first one actually stole stuff and they thoroughly fixed that problem and sold the site to a company with better resources and a large background in banking.

For those of you too lazy to RTFA (4, Informative)

slashmydots (2189826) | 1 year,18 days | (#43358709)

Hackers DDOSed just the website itself to scare people into a sell-off then bought up the cheaper coins and waited for the price to rise again. This has nothing to do with the bitcoin network or protocol, zero coins were stolen, and no security was breached at MTGox. So everyone above me, STFU and read the article or this before talking out your ass about bitcoins.
Load More Comments
Slashdot Account

Need an Account?

Forgot your password?

Don't worry, we never post anything without your permission.

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>
Sign up for Slashdot Newsletters
Create a Slashdot Account

Loading...