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Security Breach Forces Bitcoin Bank Inputs.io To Halt Operations

timothy posted about 9 months ago | from the bank-holiday dept.

Bitcoin 285

New submitter BitVulture writes "The hardcore Bitcoin community is abuzz with news of the closure of Inputs.io, a supposedly secure online Bitcoin wallet, after an attack resulted in the loss of 4100 Bitcoins. A PGP-signed message at the home page of the now mostly non-operational site briefly explains the situation: 'Two hacks totalling about 4100 BTC have left Inputs.io unable to pay all user balances. The attacker compromised the hosting account through compromising email accounts (some very old, and without phone numbers attached, so it was easy to reset). The attacker was able to bypass 2FA due to a flaw on the server host side.' There's no word yet whether Inputs.io will eventually resume operations or whether the security breach will force the Bitcoin bank out of business."

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285 comments

So? (0)

bluefoxlucid (723572) | about 9 months ago | (#45355515)

It's computer fraud and abuse. It's not like they really robbed a bank.

Re:So? (3, Interesting)

gl4ss (559668) | about 9 months ago | (#45355657)

It's computer fraud and abuse. It's not like they really robbed a bank.

which, amazingly enough, in mots of the west gets a lot more of jailtime for you even if you stole nothing of actual monetary tangible value....

though, again as usual, one needs to ask if they just took it themselves, their ex-employee took it or..

Re:So? (4, Funny)

postbigbang (761081) | about 9 months ago | (#45356457)

Dillinger lives. He drives a Tesla, and carries ultrabook instead of a machine gun.

Re:So? (4, Insightful)

QilessQi (2044624) | about 9 months ago | (#45355701)

We seem to be fast approaching the point where computer-based theft will be the way you "really rob a bank".

It's not like today's banks have all got huge safes full of bags with dollar signs on them -- not in the U.S., anyway. Money is becoming increasingly virtual. A dollar bill doesn't actually represent value; it represents debt, an IOU. A bank doesn't need to keep one physical dollar bill on hand for every dollar in its bank accounts; it only needs a fraction, because you don't expect 100% of your customers to come in on the same day to cash out. And thanks to the Federal Reserve system, there aren't even physical assets (like gold bars) of equal value to all the Federal Reserve notes in circulation. It's a bizarre system that only works as long as debt keeps circulating (buying and selling) and accumulating (loans with interest).

Re:So? (4, Informative)

blue trane (110704) | about 9 months ago | (#45355767)

Credit existed long before the Federal Reserve. J. P. Morgan used created money to help out banks in the Panic of 1907. The Bank of England created money to get its country out of panics in the 1800s. The private banking system evolved the system that the Fed later put in place on a more equitable basis (loaning to all banks instead of only to those that Morgan had a personal affinity for, for example). Elasticity was necessary for the banking system to function. The Fed just made that elasticity more under the public's control, so that it could be used for the General Welfare instead of for Morgan's private profits.

Re:So? (2, Informative)

Anonymous Coward | about 9 months ago | (#45356057)

Credit existed in fourth (and probably fifth) century BC Athens. It was also largely responsible for inflation then: the monetary system was metal-based, but even the ancients noticed that old inscriptions and laws mandated unreasonably low prices for sacrificial animals, while people in their own time were buying and selling real estate for amounts of credit that couldn't be physically transported in any reasonable way as cash and that might not have even been available in circulation. The Athenians didn't have a Federal Reserve or central bank, just a mint for the physical coins and some private bankers for the credit. That's all you need to get the "bizarre system" that keeps cropping up in history.

As a side note, that "bizarre system" almost always ends up with the poor holding physical currency and the rich using credit. Playing along with the system gets you more stuff, because you can buy more with big credit than you can with two obols (although you could at least rent a prostitute for that).

Re:So? (1)

bluefoxlucid (723572) | about 9 months ago | (#45356019)

Yes, and this is why I keep telling people America is fucked up and the FRS is ridiculous. We don't have "economic growth"; when our economy grows, it gets poorer. When one person pays their debts and gains assets, another person must necessarily go into debt--not just become less wealthy, but actively move toward negative wealth. Poverty here is, on the books, worse than poverty in some small regions in Africa: our poor people have less than a Ugandan who has to walk 9 miles for water, but we still eat expensive beef.

Re:So? (1)

Anonymous Coward | about 9 months ago | (#45356061)

Poverty here is, on the books, worse than poverty in some small regions in Africa: our poor people have less than a Ugandan who has to walk 9 miles for water, but we still eat expensive beef.

There's a point here, and you're missing it.

Re:So? (1)

gl4ss (559668) | about 9 months ago | (#45356429)

and well that's why pre ww2 stock crash was actually something causing massive panic and the crash of 21st century is something people barely notice...

because on the whole masses are not going hungry over it. on the whole they have more - more tools, bigger tv's... that's whats wonderful about modern day - even if you're technically poor* you got access to a wealth of information and entertainment - and even if you're supermegafuckingrich what you eat is pretty much the same as what the people earning 1/10000th of what you do eat. a chicken is a chicken and how much filet mignon are you going to eat anyhow and a club sandwich doesn't get better if costs 1000 bucks than if it costs 16 bucks(base price for decent club sandwich with fries in Helsinki, in random place in america I bet you can get the same for six bucks...).

what you can afford if you're supermegarich is hired help of course, but the middle upper class in the west has been losing that habit as well.

sure, if you're supermegafuckingrich you can afford more coke and hoe's but you can't get even those in the ratio your income would let you to believe. I mean, it would be funny if gates rented 10 000 hoes for a party but I just don't see it happening.

*) poor in the so called west. poor in some other parts of the world are pretty fucked still but they were as fucked or more fucked before the stock market crash too.

Re:So? (1)

Anonymous Coward | about 9 months ago | (#45356253)

During a course in criminal justice in college, the instructor actually stated exactly this, with a few reasons:

1: The cop on the beat sees someone with a computer in a coffee shop. They move on. Someone committing a bank robbery is obvious, and the street officer can intercept as the robbery is in progress.

2: Robberies are violent with tons of charges, from having a gun, to having a gun in a public area, to having a gun 10,000,000 feet from a school, to having a gun while committing a felony, etc. A CFAA violation is one charge.

3: Numbers are abstract. Someone threatened with a weapon is something jurors relate to on an emotional level. This means that the penalties will be a lot stiffer for bank robber who gets $500 versus a blackhat getting $50,000.

4: A good blackhat if caught can possibly get a job as a part of a plea bargain. A gangbanger shooting up a bank is likely going to face a life of McJobs and the revolving door of private prisons.

5: Physical security of banks is a lot higher than server rooms. In a bank, there is some security guy with some type of duty pistol. A server room has a HID lock on the door and maybe someone answering phones at a desk.

6: The economy has not hit bottom yet. Jobs are not returning in the US, and when they do, they are overseas due to the tax benefits (even in the US, H-1Bs and 1Bs are tax exempt.) This means that more people are forced to go the blackhat route. Think Breaking Bad, but in reality.

7: Companies view security has no ROI, making them an easy target for a dedicated intruder.

8: There are no penalties (lets be real, people forget about "ABC, inc. got hacked and all credit cards taken" in 30 seconds.) So, it is an open door.

9: You route stuff through a compromised box in China or another country, the investigation is over. Nothing can be done, period, about an intrusion.

10: There are plenty of tax havens to stash cash, and laundering these days is no problem at all for anyone who has a brain. All you have to do is start up a nightclub, and report completely packed earnings even if the place has nobody at the door... a couple years, and all income is now legit, and the clubowner will get good PR with a few donations to local charities.

So, all and all, it is actually amazing why businesses and banks are NOT hit harder.

Re:So? (1)

firex726 (1188453) | about 9 months ago | (#45356473)

For larger amounts ,many will actually require you notify them in advance.
Want $10,000 in actual cash at once? You need to call a day or two in advance so they can have a shipment made.

Re:So? (1)

Opportunist (166417) | about 9 months ago | (#45355787)

Which IS also by now pretty much the only way you could possibly rob a bank.

Banks around here don't have big bullet-proof glasses between you and the teller anymore. Simply because there is no cash drawer anymore. The cash is inside a safe that doubles as the table you're sitting at and only if the teller withdraws some amount from an account that amount of money appears automagically from a slit in the table. The teller CANNOT even give you the money in the safe since he simply has no access whatsoever to it. And the computer doesn't let him withdraw anything if there is no signature that matches the one stored, so he can't even withdraw from some random account to give you money.

Seriously, if you're in for money, rob a gas station. You get way more than you could possibly get from a bank (unless you're willing to put in more effort than going in and yelling "hands up").

Re:So? (1)

BitZtream (692029) | about 9 months ago | (#45356139)

... Bank robberies of Bank of America and Suntrust seem to be relatively common around here, I hear about at least one a year, sometimes 2. They seem to be doing fine making off with sums as high as 10k in some recent cases so while I understand what you're saying, they doesn't seem to be the end of the bank robbers taking case from the tellers.

Re:So? (1)

jandrese (485) | about 9 months ago | (#45356181)

no signature that matches the one stored

Do these banks somehow use a digital signature? Computer recognition of a written signature is still way too unreliable to use it as a primary means of access.

Re:So? (1)

Opportunist (166417) | about 9 months ago | (#45356381)

Mostly the teller can override the system, but the amount of money you can get out of him without some additional means is ridiculous for the average bank holdup. It's more a matter of time vs. money where getting much money out of the safe takes a lot of time (also one of the reasons why it takes ridiculous amounts of time for "processing" the withdrawal, it's an artificial block that should ensure that you don't get more than a few hundred bucks out of it every minute).

Re:So? (1)

mark-t (151149) | about 9 months ago | (#45356395)

That's still a felony, afaik.

Can nobody design a secure Bitcoin wallet? (0, Funny)

Anonymous Coward | about 9 months ago | (#45355519)

Lets hope Bitcoin Dark Wallet [indiegogo.com] can do it right.

Dark Wallet is a project of unSYSTEM and Defense Distributed that starts with simple premises: Bitcoin as a web technology and privacy by default.

Re:Can nobody design a secure Bitcoin wallet? (1)

FriendlyLurker (50431) | about 9 months ago | (#45355533)

Great intro video... 31,306USD Raised of $50,000 Goal...

For worst or better (3, Insightful)

JcMorin (930466) | about 9 months ago | (#45355521)

This is for worst or better, online wallet that CONTAINS your private key can be hacked like inputs.io. That's why it's recommended to use wallet like blockchain.info where you hold the private key so they can't spent bitcoin for you. In some case where they must hold the key for you (exchange service for instance) most of their coin should be in cold storage / not allocate to direct individual. In another news, Bitcoin value is at all time high over $300.

So simple... (4, Funny)

DogDude (805747) | about 9 months ago | (#45355545)

I'm so glad that Bitcoin is such a simple solution to the complexity of cash!

Re:So simple... (1)

nurb432 (527695) | about 9 months ago | (#45355573)

Except that was never its intent.

Re:So simple... (1)

Anonymous Coward | about 9 months ago | (#45355623)

Then it is an unqualified success. Between the hackers after your money and the government tagging anyone who uses Bitcoin as a probable criminal, I'd never touch the shit.

Re:So simple... (0)

Anonymous Coward | about 9 months ago | (#45355797)

as opposed to the muggers, bankers and government after your other currency

Re:So simple... (0)

Anonymous Coward | about 9 months ago | (#45356415)

Given the public transaction log, about the only one of those that has a possibility of not affecting bitcoin is bankers, but, as you can see, this story is about...incompetent bankers.

Re:So simple... (2, Interesting)

Anonymous Coward | about 9 months ago | (#45355681)

And yet that's what every proponent of Bitcoin (including the paid shills that edit this site) has tried to convince us of from the very beginning -- that Bitcoin could supplant real currency. Now that the whole plan is crashing down in flames those same proponents have no defence other than "Bitcoin was never meant for that purpose." Funny how your perspective changes when you find out your "sacred cow" is more like "a big steaming pile of bullshit."

That's what you get for buying into an easy-money scheme. No sympathy for the devil and all that.

Re:So simple... (0)

Anonymous Coward | about 9 months ago | (#45356189)

To be fair, the easy-money scheme works if you're at the top of the pyramid.

Or if you can trick people into depositing their money into your shady online "bank".

Re:So simple... (0)

Anonymous Coward | about 9 months ago | (#45356447)

Now that the whole plan is crashing down in flames

Got any evidence of that?

If you think bitcoin might crash some day, or think it's a bad idea, just say so. But you look like either a liar or an idiot, any time you say it has happened or is happening. That is simply objectively false. At a bare minimum, bitcoin is an overwhelming success .. so far. The future is the thing that is still debatable.

Re:So simple... (1)

Anonymous Coward | about 9 months ago | (#45355631)

I'm so glad that medicine is such a simple solution to the complexity of dying!

The point of bitcoin isn't to simplify existing systems, but to improve them.

Re:So simple... (1)

Anonymous Coward | about 9 months ago | (#45355669)

I'm so glad that Bitcoin is such a simple solution to the complexity of cash!

It was an organization which managed your bitcoins for you. Not unlike the organizations which manage your dollars for you, known as banks. As soon as you bring your dollars to a bank, you no longer consider them cash. In the same way, once you bring your bitcoins to such an "online wallet", they lose any similarity with cash. You've essentially gotten a bank account, with all the complexities and risks coming with a bank account.

Re: So simple... (0)

Anonymous Coward | about 9 months ago | (#45355753)

With none of the benefits of a traditional bank.

" a flaw on the server " (1)

nurb432 (527695) | about 9 months ago | (#45355565)

Might want to make that more clear in story, it almost reads like an anti-bitcoin FUD thing.

So a 'bank' had their servers breached and money stolen... *yawn*.

Re:" a flaw on the server " (1)

Anonymous Coward | about 9 months ago | (#45355583)

Yeah, it'll be fine, the depositors will be made whole when the FDIC insurance pays out.

Oh, wait, this is buttcoin and we don't have any statist garbage like "deposit insurance", so the customers are in fact screwed.

Re:" a flaw on the server " (0)

Anonymous Coward | about 9 months ago | (#45355641)

Meh. It's fine - the market will fix it.

Re:" a flaw on the server " (2)

fastest fascist (1086001) | about 9 months ago | (#45356641)

Yes, they're screwed. They trusted a third party with their coins, which is simply a bad idea. Now, deposit insurance is great for bank accounts, as most people don't really have any other choice than to give a bank their money to hold for them. That's not true with Bitcoin. You can be your own "bank", and it is, in fact much safer than using a third party as one. Rule of thumb: do not use web wallets. If you must use one, only store small amounts for short periods of time there.

exact (2)

JcMorin (930466) | about 9 months ago | (#45355619)

Unlike traditional bank, you can trace the money stolen where it goes but unable to get it back. Bitcoin have no way to force a transaction except if everyone would update their software to approve a transaction without the valid cryptographic signature something unlikely to happen considering the thousands of instance running.

Re:exact (4, Insightful)

bobbied (2522392) | about 9 months ago | (#45356023)

This is the thing about BitCoin I never understood. The proponents of BitCoin claim that it was untraceable, but all transactions are traceable by looking at who spent the coin and who owns it now, at least by their public key. This information is included in the data blob that IS the coin and lots of people have to observe the transaction before it becomes valid. You may not know who's key is who's, but you certainly can trace ownership of the BitCoin.

So, you may not know who owns a single coin, but though simple observation of transactions and a bit of foot work you can easily piece together who's who and who's spending their coins on what. It becomes a data mining operation with a bit of detective work to trace where folks are converting traditional currency into and out of BitCoin. Which is totally different than trading say dollars in currency. You *might* be able to trace currency transactions though things like DNA traces left on the bills or serial numbers (if you know them), but if somebody passes a briefcase of money around, there will be no way to trace each transaction that might have taken place.

Re:exact (0)

Anonymous Coward | about 9 months ago | (#45356255)

Looks like you understand just fine. Fanboys of any ilk are inclined to say any stupid thing if it justifies their fanboy status. If you want to understand something, it's best to get as close to the source as you can and see for yourself how it works.

Re:exact (0)

Anonymous Coward | about 9 months ago | (#45356305)

I can answer this one. Proponents will say whatever supports their position. In this case, as you argue, the position is baseless. Fortunately for BitCoin this is not the only thing going for it. It is unfortunate that proponents pick this one to proclaim so loudly.

Re:exact (1)

MightyYar (622222) | about 9 months ago | (#45356517)

It certainly isn't inherently untraceable, but it is trivial to launder. Wallets are anonymous and unlimited.

Re:exact (2)

dj245 (732906) | about 9 months ago | (#45356751)

It certainly isn't inherently untraceable, but it is trivial to launder. Wallets are anonymous and unlimited.

Is laundering effective if the entire record of all transactions is public information? At best, it would provide plausible deniability only.

Re:" a flaw on the server " (1)

Anonymous Coward | about 9 months ago | (#45355647)

Is there any evidence that the people running the service didn't just take the money and run?

I mean, what was really stopping them from doing that? Once you get to a point where a rational analysis of the situation would tell you that emptying all the deposits into your own account will net you more profit than the total expected future "legitimate" earnings of the "bank", why wouldn't you do it? It's not like the cops are going to investigate a Bitcoin transfer.

Re:" a flaw on the server " (0)

Anonymous Coward | about 9 months ago | (#45356367)

This is what happened. This story reads exactly like the ponzi scheme websites from the early 2000's, when they would close up shop and run after collecting millions in people's life savings. 4daily, studiotraffic, ect. al.

The site owners almost feel a little bit guilty and the excuses are to cover that small bit of guilt in the back of their mind. If you met these 'bank' owners in real life you'd never trust them with your money. This kind of greed will ultimately be the undoing of bitcoin and most other currencies like this.

HAHAHAHA (0)

GameboyRMH (1153867) | about 9 months ago | (#45355571)

Holy shit, 4100? Is that ALL the bitcoins!?!? XD

Re:HAHAHAHA (2, Informative)

kajsocc (2955535) | about 9 months ago | (#45355637)

Holy shit, 4100? Is that ALL the bitcoins!?!? XD

No, but it is about $1.23M at current exchange rates.

Re:HAHAHAHA (1)

JcMorin (930466) | about 9 months ago | (#45355653)

4100 stolen, not sure how many they had. The current total number of bitcoin in circulation almost 1.2 millions each at about $ 300 piece. number of bitcoin in circulation [blockchain.info] price chart [bitcoincharts.com]

Re:HAHAHAHA (1)

camperdave (969942) | about 9 months ago | (#45355703)

Holy shit, 4100? Is that ALL the bitcoins!?!? XD

That's roughly 1.2 million dollars, my friend, at current exchange rates. And incidentally, there are aproximately 12 million bitcoins.

Great (1)

benjfowler (239527) | about 9 months ago | (#45355621)

So now I need a PhD in computer security to use Bitcoin without getting robbed?

In security, complexity is a smell.

Re:Great (1)

lxs (131946) | about 9 months ago | (#45355667)

No you need to keep your wallet encrypted on your own computer with a backup in a strongbox off site and remember to never entrust your valuables to random clowns on the internet.

Re:Great (0)

Anonymous Coward | about 9 months ago | (#45355713)

With real money, though, I can just deposit it at a bank, and it's far more convenient and secure than keeping federal reserve notes in a fireproof safe in my closet.

And if someone robs the bank, there's insurance to pay out the money and the FBI to go find the robbers. They're even pretty good at it.

Re:Great (1)

BitZtream (692029) | about 9 months ago | (#45356169)

No, I'll just keep cash and a real bank instead.

All the advantages of bitcoin, none of the disadvantages.

Of course, I also live in the real world and not fantasy land.

Re:Great (1)

fastest fascist (1086001) | about 9 months ago | (#45356709)

You can send money across the globe almost instantly, with low fees and no-one to stop you from donating to your favourite politically unpopular charity using cash or a real bank?

Secure Online Wallet (5, Insightful)

lxs (131946) | about 9 months ago | (#45355635)

Pick any two.

Re:Secure Online Wallet (0)

blahbooboo (839709) | about 9 months ago | (#45355711)

Pick any two what? I think you need to list 3 things for us to pick two from.,..

Re:Secure Online Wallet (2)

jtmach (958490) | about 9 months ago | (#45355785)

Pick any two, from the following; Secure Online Wallet

Re:Secure Online Wallet (-1)

Anonymous Coward | about 9 months ago | (#45356099)

Secure Online.

Yeah right! Tell that to the NSA guy looking over your virtual shoulder.

Fail. Epic fail. Humongous fail. Utter and complete fail. System crash. 404. BSOD. Chernobyl. Kaboom. Hasta la vista, baby. You gotta ask yourself this question: "Do I feel lucky?" WELL, DO YOU, PUNK???

Re:Secure Online Wallet (0)

Anonymous Coward | about 9 months ago | (#45355789)

Secure is one, online is one. You can have a secure wallet, or an online wallet. But not both.

Re:Secure Online Wallet (0)

Anonymous Coward | about 9 months ago | (#45355811)

I thought at first you might need to go grab some coffee and read his post again.
Then, I read some of your previous posts to verify.
Turns out, you're just an idiot.

Re:Secure Online Wallet (0)

Anonymous Coward | about 9 months ago | (#45355817)

Security, Onlinearity, Walletness.

Re:Secure Online Wallet (1)

mrchaotica (681592) | about 9 months ago | (#45356257)

Look at the post's title.

It's not correct though, since not all "pick twos" are valid (e.g. "Secure Online")...

Re:Secure Online Wallet (1)

museumpeace (735109) | about 9 months ago | (#45355771)

i'd pick Secure and Wallet and screw Online...air gap for me.

Re:Secure Online Wallet (1)

cpicon92 (1157705) | about 9 months ago | (#45355813)

Okay... I pick Secure Online!

Re:Secure Online Wallet (1)

museumpeace (735109) | about 9 months ago | (#45355831)

Unfortunately for the average consumer, in fact virtually all consumers, the present scheme for credit card online purchases, e.g. Amazon, is trying to tell you that you can have all 3. What percent of consumers have to take a loss before either they or their card provider's insurance co. pulls the plug on this bizarre bazaar?

Re:Secure Online Wallet (1)

Opportunist (166417) | about 9 months ago | (#45355841)

Ok. Secure online.

Provide it if you can.

Re:Secure Online Wallet (4, Funny)

eric31415927 (861917) | about 9 months ago | (#45355933)

Pick any two.

I'm afraid it's pick any one.

Re:Secure Online Wallet (0)

Anonymous Coward | about 9 months ago | (#45355971)

http://www.ahmad-web.com/

Re:Secure Online Wallet (0)

Anonymous Coward | about 9 months ago | (#45356471)

Secure online, please!

Virtual Currency (0)

Anonymous Coward | about 9 months ago | (#45355661)

Let's call the real cops who are paid by real taxes to investigate the theft of tax-avoiding digtal currency!

Re: Virtual Currency (1)

UnknownSoldier (67820) | about 9 months ago | (#45355691)

And digital WoW gold is tax avoiding too? Pull your head out of your arse. The government has NO valid jurisdiction over arbitrary digital currencies.

Re: Virtual Currency (1)

Opportunist (166417) | about 9 months ago | (#45355847)

Then I guess they also have no business prosecuting the theft thereof?

Re: Virtual Currency (0)

Anonymous Coward | about 9 months ago | (#45355903)

I hope they don't spend the resources to prosecute people who steal each other's WOW gold.

Re: Virtual Currency (1)

Opportunist (166417) | about 9 months ago | (#45356399)

Probably not. If you can't tax it, why bother?

Re: Virtual Currency (2)

Sockatume (732728) | about 9 months ago | (#45355891)

WoW gold is ultimately money in Blizzard's bank accounts, which are indeed taxed.

Re: Virtual Currency (1)

kajsocc (2955535) | about 9 months ago | (#45356047)

This isn't true. WoW gold has no value from an accounting perspective. Blizzard does not put it on their balance sheets or cash flows, they are not required to track or report it, and they have absolute authority to create or destroy it at any time. They also (try to) crack down on anyone trading it for real money. Unless you're speaking in a very very abstract sense, it is not money in any bank account, and it is certainly not taxed. Yet.

Re: Virtual Currency (1)

Sockatume (732728) | about 9 months ago | (#45356385)

It's ultimately the product of people's computer time in WoW, which is a service provided by Blizzard through their paid-for and taxed-up business. If you're buying it with real cash, you pay for it through some perfectly ordinary, fully-taxed transaction. It's not a medium of barter outside of WoW so it strikes me that you're essentially trading some nominal portion of Blizzard's net worth.

Basically it's no more legally problematic than those vouchers towns put out that can only be spent at local businesses, or Mickey dollars. Although if I've missed something I'd like to know about it.

Re: Virtual Currency (0)

Anonymous Coward | about 9 months ago | (#45356497)

It's supposed to be taxed when you trade it for cash.

Re: Virtual Currency (1)

BitZtream (692029) | about 9 months ago | (#45356183)

Uhm, actually, it does, beyond any doubt.

Not sure what silly fantasy you live in, but currency used in the realm is most certainly a concern of the realm, and its written into law.

Luckily there are control instances (0)

Anonymous Coward | about 9 months ago | (#45355677)

to freeze the accounts and get at least some of the money back.

Oh, wait. There aren't. How's that anarchy tasting?

NOTHING OF VALUE LOST !! (0)

Anonymous Coward | about 9 months ago | (#45355689)

Just bits !! Imagination !! Hand waving !! Suckers !!

Re:NOTHING OF VALUE LOST !! (1)

Opportunist (166417) | about 9 months ago | (#45355865)

That's what I said when the stock exchange hit rock bottom a few years ago, but boy did that handwaving create a shitstorm!

Bitcoin is it just a scheme? (0)

blahbooboo (839709) | about 9 months ago | (#45355693)

Having watched this bitcoin project/program/scheme (whatever) unfold the last couple years it seems like a money making fraud scheme. I still don't fully understand how it works, it's extremely confusing to actually try to use the "currency", why someone can just say a bitcoin is worth X dollars, and you can create money by "mining" for it with a graphics card. It feels like something created by criminal entities which will eventually collapse or found to be fraudulent....

Re:Bitcoin is it just a scheme? (0)

Anonymous Coward | about 9 months ago | (#45355783)

How appropriate your handle is blah boo boo then. Try start here [technologyreview.com] , or stick to your default currency until BTC moves out of the early adopter phase and all these teething problems are either worked out, or the whole thing re-invents itself. One thing is certain: Crypto currency in one form or another is here to stay...

Re:Bitcoin is it just a scheme? (3, Insightful)

Opportunist (166417) | about 9 months ago | (#45355877)

Hey, if there was a country behind it we'd call it currency despite being pretty much the same system, where someone says one blubber is worth x dollars and you can create some by ... well, by creating some.

Re:Bitcoin is it just a scheme? (1)

Michael Casavant (2876793) | about 9 months ago | (#45355937)

Mining bitcoins takes real equipment and energy, not so dissimilar from mining gold. What makes gold worth money? Because we (as a global community) all got together and said "Gold is worth $X". Is it really worth $X? Yes, because that's what someone will pay for it.

What is a dollar worth? That value changes all the time, it is in reference to something else (gold, other currency, real material goods). The dollar is something that is made up that we all agree has value. Bitcoin is something made up that we all agree has value.

The big difference between gold, dollars and Bitcoin is this:
-Dollars can be printed at will by the government, so is theoretically infinite.
-Gold you have to dig out of the ground, so is finite, but we don't know how much is really out there.
-Bitcoin needs to be "mined", so it is finite (mathematically limited). We know the total quantity and how fast it will get mined.

Re:Bitcoin is it just a scheme? (1)

neilo_1701D (2765337) | about 9 months ago | (#45355989)

why someone can just say a bitcoin is worth X dollars

Because it is a commodity, and the market price of a commodity is determined by the intersection of the supply and demand curves for that commodity. So, you **can** say that a bitcoin is worth $X. Now go find someone willing to either buy or sell at that price.

you can create money by "mining" for it with a graphics card

Well, you can go cut down a tree, make a table and sell it. Same thing, from an economics point of view.

It feels like something created by criminal entities which will eventually collapse or found to be fraudulent

Given the murky history of the creation of bitcoins, I can see how you might think this. However, let's suppose that it's true: Bitcoins are the product of criminal entities. What's the payoff? Bitcoins only have value because there is a market for them. It doesn't take much to create a run on the market and drive the price through the floor. Then again, there was the "Bitcoin Bubble" earlier this year; have enough bubbles and you can generate real money. It's worth reading up on Bitcoins, if only to see that it's the digital equivilent of Tulip mania. Try https://medium.com/money-banking/2b5ef79482cb [medium.com] for a nice overview of the bubble, or Wikipedia.

Re:Bitcoin is it just a scheme? (1)

myowntrueself (607117) | about 9 months ago | (#45356495)

When you 'mine' a bitcoin have you actually produced something of tangible value other than an electronic token which a group of people have agreed to exchange goods and services for?

ie does the process of 'mining' bitcoins actually generate some kind of useful computational result? Something thats useful in genomics, or crypto or whatever, outside of just 'more bitcoins'.

Re:Bitcoin is it just a scheme? (0)

Anonymous Coward | about 9 months ago | (#45356499)

Thanks for sharing.

Dumbass.

Good. A hard lesson. (1)

stevegee58 (1179505) | about 9 months ago | (#45355705)

Never, never, never trust your Bitcoin wallet to a third party, no matter how trusted.
Keep your wallet safe by maintaining personal, physical possession of it and adhering to safe network practices.

"Bank" (1)

Dan East (318230) | about 9 months ago | (#45355707)

I think it is a misuse of the word "bank" using it to describe these websites.

Re:"Bank" (2)

Opportunist (166417) | about 9 months ago | (#45355879)

Damn right. I don't see them getting any bailouts any time soon.

To paraphrase Don Vito Corleone (1)

TheloniousToady (3343045) | about 9 months ago | (#45355709)

"A hacker with his computer can steal more than a hundred men with guns."

Telephone number? (0)

Joining Yet Again (2992179) | about 9 months ago | (#45355715)

So, for security, you had to provide a telephone number? Ahahahahaha.

Bitcoin makes everything about currency handling harder for the average person.

It doesn't provide anonymity - that could be facilitated by a central bitcoin exchange server, which may or may not be logging everyone's activity (intentionally or otherwise). But then you might as well use any traditional money laundering method.

The only interesting thing with Bitcoin is that there's a limit to the amount of bitcoins. But just as a govenrment mandate detached the dollar from gold, a government mandate could change relevant representations+algorithms to allow the government to produce more bitcoins at will. And, just as everyone accepted who accepted US dollars accepted the former change, they'd accept the latter change too.

Bitcoins are a tool for speculators, drug dealers, and criminals.

Re:Telephone number? (0)

Anonymous Coward | about 9 months ago | (#45355913)

How, exactly, is a QR code harder than hoping you didn't forget your chip and pin card in a machine, and remembering yet another shitty 4-digit pin?

Which currency isn't used as a tool for speculators, drug dealers, and criminals? Just wondering, since you come off so arrogant you should know.

Re:Telephone number? (1)

Joining Yet Again (2992179) | about 9 months ago | (#45356221)

Which currency isn't used as a tool for speculators, drug dealers, and criminals?

Exactly. We don't need another one.

Not anonymous, not untraceable, not limited (0)

Anonymous Coward | about 9 months ago | (#45355929)

So, for security, you had to provide a telephone number? Ahahahahaha.

Yep. So much for "anonymous" and "untraceable."

...It doesn't provide anonymity - that could be facilitated by a central bitcoin exchange server, which may or may not be logging everyone's activity (intentionally or otherwise)....

Yep. It is not designed to be anonymous-- all transactions are reported. You can trust that they are not being recorded, and you can take steps to hide your identity-- but this is up to you.

The only interesting thing with Bitcoin is that there's a limit to the amount of bitcoins. But just as a govenrment mandate detached the dollar from gold, a government mandate could change relevant representations+algorithms to allow the government to produce more bitcoins at will. And, just as everyone accepted who accepted US dollars accepted the former change, they'd accept the latter change too.

Exactly. A part of the value of bitcoin lies in your trust that they don't decide to increase the number of bitcoins.

Eventually, of course, if bitcoin is to remain viable they will have to increase the number-- we have lived in a world of inflation for so long that we have forgotten that deflation is what happens when you have a fixed amount of specie. Deflation is just as bad as inflation, and the ultimate result of deflation is that it forces people to turn to other forms of currency.

motives? (2)

museumpeace (735109) | about 9 months ago | (#45355747)

It does not sound like Nation State Attacker was at work here.
The attack was not so sophisticated that the infosec boys were left scratching their heads as to how the breach was made. In fact, for a so-called vault, Inputs.io leaving up the access to old accounts that skirt 2FA seems sloppy.
And, certainly, having 4100 BTC to spend for your porn and drugs would be motivation to some who are capable of such an attack.

But I assume central banks and gov'ts with propped up currencies don't want to see Bitcoin really take off. Just breaking everyone's trust in BTC is a win for them.

Re:motives? (3, Insightful)

devman (1163205) | about 9 months ago | (#45356069)

Could have been an inside job. Collect $1.2 million in BTC from "depositors". Take all the money and run. Blame it on hackers. Profit. No one is going to investigate, there are no consequences, there is nothing to audit, and no way to seize back the funds even if some legal action were taken.

third party risk (0)

Anonymous Coward | about 9 months ago | (#45356107)

Bitcoin was designed to eliminate third party risk. The risk of the government/bank freezing assets arbitrarily. The risk of the government seizing additional "TAX" money. The risk of spying on your transactions. The risk of the government debasing the currency. etc etc etc

If you are using bitcoin in a manner that exposes you to significant and avoidable third party risk...ie. online wallets with no backup...then their is no one to blame but yourself.

In this case the risk was created from control gaps of a "fourth party" provider. The bitcoin.io's third party host was weak on several fronts.

This is why I only use FDIC-insured bitcoin banks (0)

Anonymous Coward | about 9 months ago | (#45356137)

...

Tired of bashing Bitcoin, yet? (1)

mathimus1863 (1120437) | about 9 months ago | (#45356295)

Yeah, I know it's the "fad" to bash Bitcoin. But it's disappointing, because Bitcoin represents everything that us nerds reading slashdot should like: It's a mix of cryptography, freedom of speech, computing, networking, finance, economics, and even politics. Most of us here dig that stuff.

Get over the hype and take Bitcoin for what it really is: a fascinating experiment that has, so far, withstood the amazing barrage of publicity, hacking attempts, legal uncertainties, and remains valuable for reasons completely contrary to everyone that says it's worthless. It may become worthless one day, but consider the possibility that Bitcoin is disproving all your wildly oversimplified assumptions about what makes something valuable. It is completely different than anything else we know, and there's plenty of reasons to believe that it could succeed as much as it could fail.

Why does gold have value? Nothing is backing gold. Yet it has value, mainly because of its properties: scarcity, fungibility, density, beauty, etc. Bitcoin is really quite similar but with some different properties. Ease of transfer over the internet, fungibility, scarcity, storage efficiency, near-anonymity and built-in escrow. I don't think it's any more ludicrous for Bitcoin to have value than it is for gold to have value. And in the end, when I want to sell WoW weapons, buy webserver space, or play a few games of poker online, why would I use credit cards or paypal, which all require me to remember log-in creditials, give away personal information to be [improperly] protected by a third-party and/or pay a bunch of fees. There's plenty of value in being able to pay people across the world, instantaneously, without sacrificing your privacy, and without paying any fees. Why is that not valuable?

Re:Tired of bashing Bitcoin, yet? (2)

DogDude (805747) | about 9 months ago | (#45356613)

But it's disappointing, because Bitcoin represents everything that us nerds reading slashdot should like: It's a mix of cryptography, freedom of speech, computing, networking, finance, economics, and even politics. Most of us here dig that stuff.

Speak for yourself. One of the founding principles of geekdom that I learned from geeks much older and much smarter and much wiser than me, and that I still believe wholeheartedly in is: KISS (Keep It Simple, Stupid). Bitcoin fails KISS, spectacularly.

Bitcoin is a laughably complex solution that's looking for a problem. It's a Rube Goldberg contraption. It's much more complex than any other payment system, it's value as a currency is wildly unstable, it's prone to all sorts of technical and security problems, and it's insanely un-private.

The whole thing is a load of garbage or a brilliant performance art piece, depending on how you look at it.
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