[Elitiachirl]

250k gone because ONE GUY fucked up a manual backup? LOL

http://www.pcworld.com/businesscenter/article/261894/bitcoin_exchange_loses_2500000_after_unencrypted_k eys_stolen.html

Hackers stole about US$250,000 from BitFloor, a BitCoin exchange, on Monday, and it does not have the money to reimburse account holders, according to the website's founder.
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BitCoins are an electronic currency that are generated as computers solve a changing mathematical problem. A BitCoin is essentially just a secret number, which is protected from unauthorized transfers by public key cryptography, that is associated with an 34-character alphanumeric "address" that a user holds.
BitFloor, based in New York City, allowed account holders to buy and sell BitCoins, exchange the currency for U.S. dollars and transfer the money using the ACH (Automated Clearing House) system.
The cryptography wrapped around BitCoins is designed to make it nearly impossible to derive the private keys needed to gain possession of the secret number. But in the case of BitFloor, hackers found the keys.
Roman Shtylman, BitFloor's founder, wrote on a forum that the hackers obtained an unencrypted backup of the keys, which were then used to transfer coins held by BitFloor. The backup "was made when I manually did an upgrade and was put in the unencrypted area on disk," he wrote.
"I realize the details of the failure and attack are interesting but I am currently focused on user accounts and exchange status going forward," he wrote.
BitFloor's reserve of BitCoins -- about 24,000 -- was wiped out. A BitCoin was worth about $10.46 as of Wednesday, according to Mt. Gox, another BitCoin exchange.
U.S. dollar accounts with BitFloor were not affected as well as records for accounts and trades, Shtylman wrote. BitFloor turned over around 64,000 BitCoins a month, worth some $717,000. It took a 0.3 percent commission from trades, amounting to around $2,100 in revenue for the site, Shtylman wrote.
"As a last resort, I will be forced to fully shut BitFloor down and initiate account repayment using current available funds," Shtylman wrote. "I still have all of the logs for accounts, trades, transfers. I know exactly how much each user currently has in their account for both USD and BTC [BitCoin]. No records were lost in this attack."
One user asked if BitFloor could secure some investor funds in order to pay back customers. "This would be a possibility if investors interested in helping continue operations show interest," Shtylman wrote. "It is certainly something I am thinking about."

[avaincmolla]

That is why I barely trust anything important to a digital format. One click of a mouse or keystroke and......POOF....it's gone!

[tofRobbroolve]

Computer digits are difficult to hold in your hand

[Flefebleaft]

Somebody stole fake money and can't replace it with real money.....the irony is not lost on me

[TubOppomo]

Somebody stole fake money and can't replace it with real money.....the irony is not lost on me

Oh, but it'll be so much better and safer when the banksters totally control the digital money and that's all there is. You know we can trust them, they've done a great job of managing things so far. God bless 'em.

[enurihent]

Bitcoin wasn't hacked.

An exchange called Bitfloor was.

Bitcoin, as a protocol, is actually ridiculously secure, using cryptographic principles.

But if you don't hold it, you don't own it. As in, don't leave bitcoins or USD on an online exchange.... keep them in an encrypted wallet on your own system, or, even better, on a "paper wallet", or "brain wallet".

[Jueqelyl]

"If you don't back it up properly, you don't own it."

JQP

[Anamehuskeene]

If you can't remember your password, you don't own it.

[Xiciljed]

Shitcoin.

[Lenkapuppia]

"If you don't back it up properly, you don't own it."

JQP

Sort of the same!

[Nesskissabe]

I am a bitcoin moron. But I would like to understand this. A few questions:

1. How was valuation of a bitcoin in dollars arrived at?
2. Can my PC mine for bitcoins in the background, 24/7? If so, how many bitcoins might I find with an I-5 CPU doing nothing but bitcoin mining?
3. If everyone's PC can mine bitcoins, is there a danger of bitcoin inflation?

[eXC3Kvnn]

I am a bitcoin moron. But I would like to understand this. A few questions:

1. How was valuation of a bitcoin in dollars arrived at?
2. Can my PC mine for bitcoins in the background, 24/7? If so, how many bitcoins might I find with an I-5 CPU doing nothing but bitcoin mining?
3. If everyone's PC can mine bitcoins, is there a danger of bitcoin inflation?

1) The free market - the laws of supply and demand. Supply of bitcoins is limited to 21 million ever. Bitcoins "started" at about $0.001 each when the protocol first came out. Then they got as high as $30 and now are around $10.

2) Not anymore, too many people are doing it with much more efficient equipment that is designed for it.

3) Nope. See 1.

[thehhhyips]

1) The free market - the laws of supply and demand. Supply of bitcoins is limited to 21 million ever. Bitcoins "started" at about $0.001 each when the protocol first came out. Then they got as high as $30 and now are around $10.

2) Not anymore, too many people are doing it with much more efficient equipment that is designed for it.

3) Nope. See 1.

So bitcoin seems more like a security or stock than a currency. Bitcoin company capitalization = bitcoin price X 21 million?

What is the 21 million limit, prime numbers?

[Asianunta]

So bitcoin seems more like a security or stock than a currency. Bitcoin company capitalization = bitcoin price X 21 million?

What is the 21 million limit, prime numbers?

from https://en.bitcoin.it/wiki/Controlled_Currency_Supply

Bitcoins are created each time a user discovers a new block. The rate of block creation is approximately constant over time: 6 per hour. The number of Bitcoins generated per block is set to decrease geometrically, with a 50% reduction every 4 years. The result is that the number of Bitcoins in existence will never exceed 21 million[1]. This algorithm was chosen because it approximates the rate at which commodities like gold are mined. Users who use their computers to perform calculations to try and discover a block are thus called Miners.


Kinda, sorta, but I don't like to use the word "security" for regulatory reasons.

Actually, bitcoins don't really exist, but what does exist is a ledger by which cryptographic keys are used to confirm and transfer ownership of said imaginary bitcoins.

The technical details are just that... technical. Here is a link to the original whitepaper written by the anonymous creator of Bitcoin (it's a short read): http://bitcoin.org/bitcoin.pdf

It is worth noting that the blockchain is the ledger of all bitcoin transactions, and it is public - anonymity comes from skilled use of the software, etc, but it is possible to track transactions if you can tie an identity to a random looking bitcoin address.

[slowlexrese]

For the record I sold my all Bitcoins last month. Why? Since I had a 50% gain after a little over 2 weeks of trading and knew there was a price collapse coming. I was right and made out like a bandit.

You guys knock this shit, while I keep profiting off of it and buying more Gold/Silver with the profits. It's the only real 24 hour market that isn't rigged. Technicals and charts matter and it's easy shit to play.

[Druspills]

For the record I sold my all Bitcoins last month. Why? Since I had a 50% gain after a little over 2 weeks of trading and knew there was a price collapse coming. I was right and made out like a bandit.

You guys knock this shit, while I keep profiting off of it and buying more Gold/Silver with the profits. It's the only real 24 hour market that isn't rigged. Technicals and charts matter and it's easy shit to play.

Go on........

[Thigmaswams]

Surely at GSUS, I'm not the only one who thinks this is the banking cartel who has set out to destroy bitcoin? I mean this is the most viable alternative I have seen to FRN's in quite some time, other than sites like Gold Money etc. They can't appreciate that.

[Extipletape]

Surely at GSUS, I'm not the only one who thinks this is the banking cartel who has set out to destroy bitcoin? I mean this is the most viable alternative I have seen to FRN's in quite some time, other than sites like Gold Money etc. They can't appreciate that.

You can't be serious?

[Intiltern]

Surely at GSUS, I'm not the only one who thinks this is the banking cartel who has set out to destroy bitcoin? I mean this is the most viable alternative I have seen to FRN's in quite some time, other than sites like Gold Money etc. They can't appreciate that.

I suspected it was vulnerable from the start and once the incentive arose (i.e. the bitcoin price went up), people would try plundering it.

Bitcoins are not money as per Aristotle's criteria, I would never accept them in a transaction.

[Afigenatjola]

I suspected it was vulnerable from the start and once the incentive arose (i.e. the bitcoin price went up), people would try plundering it.

Bitcoins are not money as per Aristotle's criteria, I would never accept them in a transaction.

Ideally I wouldn't accept them either, but I'd take them over a jews fiat any day.