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Bitstamp Bitcoin Exchange Suspended Due To "Compromised Wallet"
twitnutttt writes Customers of Bistamp, the successor (until recently) to MtGox as the highest-volume dollar-denominated Bitcoin exchange, and still the preferred source of trading data for many technical analysts, sent an email at about 4:00 UTC today warning that, "Today our transaction processing server detected problems with our hot wallet and stopped processing withdrawals." They also instructed users to stop sending any deposits immediately or they may be lost. The Bitstamp website has now also suspended all exchange/trading services, and the homepage contains only a maintenance message warning users of a "compromised" wallet. Numerous references to security imply that this is a hacking attack, but Bitstamp reassures that they maintain "more than enough offline reserves to cover the compromised bitcoins."
The solution isn't regulation.
The solution is innovation.
These 1st generation exchanges don't use multiparty keys. So they have to keep all the bitcoins on hand. This makes them big fat targets.
Gen 2 exchanges will be decentralized and use m of n keys to protect the funds and simultaneously NOT hold the funds on hand themselves.
Very smart people are already working on this problem.
The LAST thing we need is red tape screwing up the innovation economy.
Decentralized exchanged already exist in one form or another. They just aren't as popular.
The entire notion of bitcoin has always seemed a little sketchy to me.
We're going to make up a money, and we're going to simultaneously claim it's secure and private, but we'll attach every transaction to the history of the money -- and then put it in the hands of any old schmuck who makes a website.
We'll claim to be an awesome alternative to government issued money, free of regulations and taxation, but we'll still try to be honest players (we promise). And a fucking pony.
The whole ecosystem seems like a pipe dream, which completely ignored reality, and has been subject to fraud and abuse for pretty much as long as I've been aware of it. FAR worse than the 'real' financial system.
So, whine all you like about the tyranny of government issued money ... you mostly sound insane, and have gotten into an overhyped, and apparently completely insecure currency.
The first time I heard of BitCoin I thought "what the heck is this for?". And pretty much every time I've heard it since, I've found myself thinking it sounds pretty sketchy.
I'm sure people will rabidly defend it, for whatever reasons they have ... but, seriously, every time I hear about BitCoin it's because it's not living up to any of the expectations, and you're putting your money into a completely unregulated pool with dodgy players.
So, I'm afraid I continue to be underwhelmed by the existence of Bit Coin, and mostly keep laughing my ass off when people lose their shirts.
Don't believe the hype.
Me, I'll stick with my bank, which operates under identifiable laws, using currency for which there is at least a pretense for the valuation and exchange rates, and involving players with many more years of proven ability to actually play this game.
But, hey, feel free to put your money wherever the hell you like.
Lost at C:>. Found at C.
In fact, according to http://www.coindesk.com/price/ the price has dropped about 15% in two days.
All I want is a secure system where it's easy to do anything I want. Is that too much to ask ~~ Randall Munroe