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$500 Million Worth of Cryptocurrency Stolen From Japanese Exchange (cnbc.com)
Locke2005 shares a report from CNBC: Hackers stole several hundred million dollars' worth of a lesser-known cryptocurrency from a major Japanese exchange Friday. Coincheck said that around 523 million of the exchange's NEM coins were sent to another account around 3 a.m. local time (1 p.m. ET Thursday), according to a Google translate of a Japanese transcript of the Friday press conference from Logmi. The exchange has about 6 percent of yen-bitcoin trading, ranking fourth by market share on CryptoCompare. The stolen NEM coins were worth about 58 billion yen at the time of detection, or roughly $534.8 million, according to the exchange. Coincheck subsequently restricted withdrawals of all currencies, including yen, and trading of cryptocurrencies other than bitcoin. Locke2005 adds, "That, my friends, is the prime reason why speculating in cryptocurrency is a bad idea!"
"That, my friends, is the prime reason why speculating in cryptocurrency is a bad idea!"
It seems that if this stuff is worth stealing, it has value. Wouldn't that make it a good candidate for speculative investment? Now allowing some half-assed third party to hold my investment in a way that could allow hackers to gain control of my funds, now that sounds like a bad idea.
Fiat currency is backed by the full faith and credit of the US Government, which includes but is not limited to it's power to levy taxes on the income and productive capacity of the economy to recover the wealth lost in that currency.
Now tell me, who and what backs cryptocurrency?
No more imaginary than the fiat currency you currently rely on. None of it backed by anything other than faith, and most of it is just a bunch of 1's and 0's in your bank or broker's computer system.
that is completely false, like it or not fiat currencies are backed by the corresponding government and operate under financial laws of the relevant country.
The banks have figured out how to make it (relatively) safe. If a cryptocurrency exchange hasn't figured it out, the fault is theirs.
The point of putting your money (or crypto coins) in a bank or exchange service is because it's become too valuable to keep on hand. Your advice to keep it in your own wallet makes sense if you have a couple hundred bucks in coins. But if you've got (say) $100,000 in coins, you'd be an idiot to keep it in your own wallet where a fire or burglar or forgetting your password could potentially cause you to lose the coins. We put valuables (money, coins, jewelry, important papers, etc) in a bank because they've paid millions of dollars to put together secure storage, and will lease space in it to you for a nominal fee.
The problem happens when you store your coins in an online exchange, under the assumption that because they're big and online they must have spent millions of dollars to put together secure storage.
Anyone who leaves any balance of coins or fiat currency in an online exchange is a moron.
If you want to speculate, mine / buy your coins, store them in you OWN wallet, then move them to the exchange when you want to sell them.
Store where?
On your computer? Just wait for a keylogger virus to clean you out.
Offline on a spare HD? Hope the HD doesn't die, oh, and be careful a keylogger virus isn't running when you plug it back in.
Redundant duel backups in separate safety deposit boxes and a special offline machine with which to do set up the transfer? Sounds like a lot of work.
Oh, and make sure you can remember your password in 5 years.
I stole this Sig