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$31 Million In Tokens Stolen From Dollar-Pegged Cryptocurrency Tether
Mark Wilson shares a report from BetaNews: All eyes may be on the meteoric rise of Bitcoin at the moment, but it's far from being the only cryptocurrency on the block. Startup Tether issued a critical announcement after it was discovered that "malicious action by an external attacker" had led to the theft of nearly $31 million worth of tokens. Tether is a dollar-pegged cryptocurrency formerly known as Realcoin, and it says that $30,950,010 was stolen from a treasury wallet. The company says it is doing what it can to ensure exchanges do not process these tokens, including temporarily suspending its backend wallet service. Tether knows the address used by the attacker to make the theft, but is not aware of either who the attacker is, or how the attack took place. The company is releasing a new version of its Omni Core software client in what it says is "effectively a temporary hard fork to the Omni Layer."
They have a script, you know. This has been played out over and over and over and it pretty much always ends the same way - with the criminals fading away and the 'investors' moving on to get fleeced by the next crypto scam.
>>>but is not aware of either who the attacker is, or how the attack took place
This does not instill confidence.
Seems like criminals like the anonymity of blockchain currencies.
If you post it, they will read.
Yes and its a forked script as well... the only thing thats stopping most people is their sense of morality... and its comforting knowing you could be very wealthy if it were not for that little thing. :)
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Just because it is a cryptocurrency, doesn't make it proven like bitcoin is proven. All sorts of third party scams have been running using bitcoin from the fed raid of silk road to mt gox but the bitcoin system itself has proven solid despite being the tool and target of every hacker around the globe and no other cryptocurrency even comes close to having passed that pressure test. Your tether, ether, dodgecoin, pokemon-emo-coin whatevers might be digital currency with cool and snazzy sounding ideas but they are barely even on the radar yet and many of them have been riddled with serious flaws. Interest in them and their value could disappear overnight. It is reasonable safe to say that no matter what happens, bitcoin is unlikely to go anywhere soon even if it ends up eventually being used as a reserve currency for some next gen winner that handles microtransactions more efficiently bitcoin will still hold value.
Is bitcoin secure because those involved in the administration of it are honest? Can the admin actually pull something like this off ? Not many people know about the backend of bitcoin.
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Bitcoin is hardly proven, and you will find this out when the economics don't work out like the fools expected. Beyond that, it's just wasteful. All that hashing to find a special result is a waste of energy. It's not even useful for peer to peer transactions like cash is - you have to be connected to the network to validate the transaction and you might be waiting minutes or even hours if your transaction doesn't make it into a block right away. Plastic cards are processed in seconds. Cash is immediate.
That's nothing. I'm working on a new cryptocurrency backed by The US Dollar. Specifically, the one in my sock drawer. If anyone can manage to corner the market on DollarCoin, they can trade it straight across for The US Dollar. That's value you can take to the bank.
"Is bitcoin secure because those involved in the administration of it are honest?"
Bitcoin is secure because administration of it is completely decentralized so that nobody has to trust anyone. The entire thing is set up so that any point you are depending on the consensus of lots of random third parties who have no way to know what they are giving an opinion on, no way to influence what comes their way, and nothing to gain from the outcome. At every point it uses insane and impossibly large numbers rather than tricks or secrets and assumes everyone is greedy. How do you get lots of people to volunteer to verify transactions they can't cook for personal gain? Call it mining and give them the new chunks of bitcoin plus the transaction fees. Solid strategies with mathematical proofs, a total lack of trust, and no assumption but a general tendency toward self-interest. That is the bitcoin way.
The other thing it does is shift a lot of the burden of "security" onto the users. Bitcoin makes sure that you can trust the bitcoin I just gave you is real, I actually had it in my pocket, and that I can't somehow take it back afterward. It entirely shifts the burden to you to care or not care about whether I got it clubbing seals or helping old ladies cross the street and to me to make sure I'm not buying the Brooklyn bridge. I tend to agree with the makers of Bitcoin, it isn't that those things are important but they aren't the responsibility of the dollars in your wallet.
"All that hashing to find a special result is a waste of energy."
That hashing isn't to find a special result, it's to validate transactions. "Cash is immediate." 80% outside the country of origin is also fake, all that "wasteful hashing " means there is no fake bitcoin... anywhere. Plastic cards also are not processed in seconds, those transactions can be reversed up to 90 days later that is a hell of a lot longer than it takes to fully process bitcoin.
Hell, I once worked a holiday season at a Michael's craft store and we had a couple hundred in counterfeit bills slip through a week even with UV checking and starch pens. There are no counterfeit bitcoins.
The system does however allow you to open yourself up to more risk of fakes in exchange for faster transaction times though. This could make sense in a number of circumstances. For instance those plastic transactions that can generally be reversed with no more than a statement up to 90 days after the fact. The merchant is calculating they make more offering the convenient and fast payment option than they lose to reversed transactions. Peer-to-peer transactions are often between people who know each other and/or who have recourse. Anyone you'd trust to write you a check can send you bitcoin with a tap that will get sync'd and validated with the network next time they go online. Even waiting one validation showing a random third party saw it in the blockchain is more assurance than you have that a wad of cash is real and seriously who is ever not connected anymore?
If your cryptocurrency is called "RealCoin", then why do you care if "tokens" are stolen? Isn't the point of a token to be a low-value stand-in for money? In case it gets stolen, you change the token, not the currency.
wait until suckers pour in the cash then when you think the pot is full, bail and roll out the trope "we were hacked", this is the real "business" model. lets hope the police/SEC look into the staff activities a bit more closely.
Bitcoin seems secure because it hasn't been visibly plundered by anyone yet. The day after it is we will know it was insecure all along. It is based on a number of assumptions that might not hold up. For example that "computing work" is reasonably similarly expensive for everyone (ie. no vastly faster hardware or algorithm will ever be narrowly deployed) and that any connectivity partitioning is benign and relatively short lived. And that the basic software is not going to be tampered with in any widespread way.
Nullius in verba
Ah yes, Bitcoin has had no breaches, fraud, or security issues in its 9-year lifetime. The perfect currency. Finally.
The value of any currency needs to be relatively stable, I guess they thought that was their best option. You are right though in that those that want to 'invest in coin*' won't find it appealing as they can't get in as an early adopter and cash out as the user base grows.
* Any currency that is attractive as an investment itself is not sustainable long term.
It's got a $140billion market cap, if it was going to be plundered then it would have happened a long time ago because that's quite some booty!
Shocked? Is anyone shocked?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
You want to give me shiny lumps of metal for my goats, are you insane?
You want to give me slips of paper backed by shiny lumps of metal for my goats, are you insane?
You want to give me slips of paper not backed by shiny lumps of metal for my goats, are you insane?
You want to give me data backed by paper not backed by shiny lumps of metal for my goats, are you insane?
You want to give me data not backed by paper not backed by shiny lumps of metal for my goats, are you insane? --- where we are now
Any currency that is attractive as an investment itself is not sustainable long term.
Think of crypto not as a regular currency, but as an easily tradeable investment.
That doesn't give me confidence in the currency, if my money could be frozen at someone else's whim.
Twinstiq, game news
It provides a conduit for businesses dealing in cryptocurrencies to accept deposits from customers with dollars that want to buy. Accepting USD or other conventional currency is governed by extensive anti-money laundering legislation, and various other administration requirements (KYC, etc.).
A cryptocurrency pegged to the dollar which is redeemable in both directions by a single entity, concentrates the legal burden on that one controlling entity.
The multiple other smaller businesses do not need to concern themselves with the legalities and technicalities of handling national currencies (particularly as many commercial banks still refuse to offer accounts, or will close existing accounts, with businesses handling cryptocurrencies). With a pegged crptocurrency, it is straightforward for a dealer to gain access to this: they just install the relevant cryptocurrency client software and interface it to their software; tasks which are already fundamental to cryptocurrency dealing, and which will therefore be part of their core business skill.
Litecoin and Dogecoin have existed for a long time, almost since the beginning right after Bitcoin.
#DeleteFacebook
Thank You. :)
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"Meaningless. (If you didn't detect them, how did you know they were counterfeit?)"
The bank detected them.
"But as long as we're being anecdotal, I pay Cash for pretty much everything, and I get about $1500 in pocket Cash a month from a Bank that is scrupulous about these things. In over three decades, I've never come across a counterfeit bill. Now it is just possible that I don't travel in circles where such bills would be passed; but I understand that there is no honor among thieves."
Given that your cash is coming from the bank where it is almost certain to be authentic, or someone giving you change out of a drawer where you almost certainly respend it without knowing if it is real or not the better question is how would you know they were or weren't counterfeit? Generally retail store deposits and other business deposits of large amounts of cash are what get the most scrutiny and it costs them outright the face value of the bill. But the bigger issue is the counterfeit cash that you don't detect which jacks up inflation making dollars in your pocket and your bank not spend as well as they should. That's why the vast majority of US currency overseas is counterfeit. Now you can believe the official inflation calculations giving tiny values and ignore that everything but staples tracked for those indexes has increased in cost by a hell of a lot more than that but either way your salary is going to worth less tomorrow than today because of a flood of fake cash.
"Paper Hanging is a Criminal act, and Banks can lack a sense of humor in these matters. What is your recourse in a Bitcoin scam? Go to the Cops and claim you were cheated in a Drug Deal by somebody you really trusted?"
And there is your bias screaming and robbing you of credibility. What is your recourse when written a bad check? Go to the Cops and claim you were cheated in a Drug Deal by somebody you really trusted?
That cash in your pocket is just as likely or unlikely to be used to purchase drugs as bitcoin. If you are scammed in a real estate investment scheme or by an exchange your recourse is just the same as if you'd used cash. Fraud doesn't suddenly become legal because bitcoin was the currency anymore than it would be if you'd used gold. Also, banks have nothing to do with paper hanging unless you've somehow conned a bank into cashing a fake check so it really has no relevance what sense of humor they have. The only thing having been written a check gets you is that if you can socially swing it without being a jerk you can eventually turn it in to the prosecutor who will attempt to collect the check and send the person to a class on handling finances if they fail. Get real, you can sell the debt for collection, take advantage of collateral, and utilize the small claims/civil courts the same as any other payment method.
"With cash, I haven't worried about any of this shit for 3 decades now. I've never had money stolen from my hands, minus a grifter for $20 in Times Square."
Then why are you worried about it with your bitcoin?
"Right now there is no insured storage of bitcoin that is backed by federal mandate."
Of course there is, you can store on an offline wallet and stick it in a safe deposit box. Where do you store your gold/silver, jewelry, 5 figures worth of electronics, car, etc? The government or bank is more likely to be the ones taking your money or handing it away to people they think are entitled to it than men in masks.