How WIRED lost $100,000 in Bitcoin (wired.com) 127
An anonymous reader writes: Back in 2013, the halcyon days of at-home Bitcoin mining, staffers in the WIRED San Francisco office turned on one of Butterfly Labs' mining machines and let it whir away, amassing a horde of 13 bitcoins -- now worth $100,000. But today we have nothing to show for our efforts. What happened to our loot?
The same thing that has happened to millions of other unfortunate miners, actually: We lost our private key, a 64-digit string of random numbers that not one of us remembers. And we've got basically no chance of recovering it: "Originally I was going to say that the closest metaphor I have is that we dropped a car key somewhere in the Atlantic," says Stefan Antonowicz, WIRED's then-head of engineering. "But I think it's closer for me to say we dropped the key somewhere between here and the Alpha Centauri."
The same thing that has happened to millions of other unfortunate miners, actually: We lost our private key, a 64-digit string of random numbers that not one of us remembers. And we've got basically no chance of recovering it: "Originally I was going to say that the closest metaphor I have is that we dropped a car key somewhere in the Atlantic," says Stefan Antonowicz, WIRED's then-head of engineering. "But I think it's closer for me to say we dropped the key somewhere between here and the Alpha Centauri."
Why no "Idiots" tag? (Score:5, Insightful)
All this does is highlight one of the many the serious problems relating to cryptocurrency.
Re:Why no "Idiots" tag? (Score:5, Insightful)
All this does is highlight one of the many the serious problems relating to cryptocurrency.
I dont think this problem can be restricted to cryptocurrencies, my lastpass account behaves in a similar fashion. If I forget the password, all my 150 account passwords are gone. My account is very very secure, no one can hack into it and the price for it is me acting like an adult and storing private keys properly. What I am trying to say is, this applies to any proper encrypted stuff. If you lose the key and have no proper restore mechanism, it is your fault.
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FYI: If recovery is possible, that means anyone can steal it from you.
Re: Why no "Idiots" tag? (Score:2)
No, don't be stupid.
Vehicles have unique VINs, traceable to their registered owner.
Crypto-currencies have no such ability to tie them to a registered owner once the key is lost - that is, in large part, the appeal of crypto-currencies, that they can not be tied to their owner.The
If I can brute-force guess your crypto-currency key, how do you protect your bitcoin from theft?
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It's possible, although there's not an APP for that, to easily bond all of your keys against your own, self-generated private key.
That's what this shit is about. Is it your key? How many times did you hash it? Your own personal key store is a great place to start. Back up the key store and hash the backup once or twice for good measure and housekeeping. Just remember what you did.
Works for me.
BTW, VINs for autos and trucks past 1977, while tougher, may or may not have valid data links-- as anyone using CarF
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I'm not stupid.
You may be since you've got a problem with it.
A block-chain currency doesn't have to be anonymous and with no knowledge of whom what amount belong to.
Just because you can prove/show whatever value actually belong to you doesn't mean anyone could.
You make the assumption that's the appeal. I'd argue the original appeal of Bitcoin most likely was the predictable and future low inflation and the it seemed then cheap transaction cost and pretty fast transactions and ... once again the inflation co
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OK. continuing the car analogy...
It would be like the police asking you to see the registration and a copy of your drivers license before they return the car to you.
The car has a public key (VIN) number + registration number, and you have the private key (your identification). I doubt they just roll up to your house and hand you the keys without any sort of identity verification and paper trail.
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And that's the difference between centralized and decentralized. Bitcoin is decentralized. Vehicle registration is centralized.
Re: Why no "Idiots" tag? (Score:5, Insightful)
Paper is still the safest method to store your passwords.
No software update, no operating system change and no hacker will be able to hack your piece of paper.
And if someone has access to your piece of paper, you have bigger problems to worry about.
Re: Why no "Idiots" tag? (Score:5, Funny)
Are you mad? One fire and it's all gone. Carve it into a stone tablet if its important.
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Obviously you either keep it in your wallet and/or multiple copies of the paper in other secure locations.
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Keeping multiple paper copies in sync is a nightmare.
A man with one watch knows what time it is. A man with two watches is never sure.
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Three watches is the best solution.
Para: Curly
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Keeping multiple paper copies in sync is a nightmare.
A man with one watch knows what time it is. A man with two watches is never sure.
Naturally you need five watches. Take the standard deviation and throw out any outliers. Average the remainder and tell everyone how dumb they are to only carry one or two watches.
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Are you mad? One fire and it's all gone. Carve it into a stone tablet if its important.
Hard to do with actual currency. Those $100 bills don't take the heat either.
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Are you mad? One fire and it's all gone. Carve it into a stone tablet if its important.
Hard to do with actual currency. Those $100 bills don't take the heat either.
However it you return the ashes to the treasury they will endeavor to validate that they are $100 bills and will replace them if they can.
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You have to return a verifiable 51% of each bill and they will replace it. However, you have to be able to prove that the remains being provided are from a single bill. They are not going to take your word for it that the pile of ashes in your hands used to be 30 x $100 bills without some kind of proof that you didn't just burn a stack of $1's and are claiming they are $100's.
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Why would you write your password on a $100 bill? You may accidentally spend it. :-P
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That's the combination to my luggage.
15 Commandments (Score:1)
That worked well for Commandments 11, 12, 13, 14 , 15 until the stone tablet was dropped
There is no such thing as 100% secure or permanent.
Multiple copies in multiple formats/media in multiple locations does get close at least for a few decades.
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But i'm sure you've lost cash due to losing it. Or having it stole. Or fire. Or any of the things that can happen to a physical item that you can't personally duplicate.
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Except, every one of those 150 sites has a password reset mechanism. So if LastPass disappeared tomorrow, you could still get into any one of those 150 sites after you reset your password. The same does not hold true for bitcoins.
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Re: Why no "Idiots" tag? (Score:3)
Which 'serious problem with crypto currencies' do you think it highlights? This was a journalistic institution who decided for ethical reasons that they couldn't use or donate the bitcoins they got from a miner that was given them, and after several weeks of deliberation they decided to destroy the key permanently, and write an article about it at the time.
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You know how I can tell you didn't read the article before you posted that...?
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Hell I don't even read the comments I'm replying to!
And you're wrong, by the way. The Earth is more than 5000 years old. A lot more.
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You know how I can tell you didn't read the article before you posted that...?
Because it's posted on Slashdot?
BTC used to be free (Score:5, Interesting)
In the very early days of bitcoin, probably 2008-2009, wallet companies were just getting off the ground and they would give you 25 BTC just for signing up for their service. I did that, and put the key and wallet info somewhere I'd never forget.
I forgot.
Every so often I'll find an old CD or DVD backup and think, "Hey, maybe I backed that up on here!", but of course I didn't. The wallet company is probably long-gone anyway.
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Mod: +1 (Hopeful)
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This is a perennial problem for us all, and not just with cryptocurrencies. I have old backup archives I can't open due to forgetting the password.
A password manager really helps.
Re: BTC used to be free (Score:2)
I've got a damaged physical bitcoin. (Score:1)
Re: I've got a damaged physical bitcoin. (Score:2)
Can't one guess the correct bits of the physical coin?
I assume it's somewhat readable.
7 BTC = 52k USD ATM.
No so much lost (Score:5, Informative)
Its not so much about how they lost a bitcoin its more about how they purposefully destroyed it!
I mean I can put a stack of $100 bills in the fireplace too and they will also be 'gone forever' as far as I am concerned personally. Its not like I can phone of the fed and ask them to print me some new ones.
Frankly the people at Wired are stupid, most journalists these days are, so no surprise there. I don't see why they could not have solved the conflict problem by selling the bitcoin for cash - so the value is not independant of the bitcoin, donating the money to their favorite charity before running the store about the mini miner thing they reviewed. Should have been and easy and obvious solution. Then you just conclude the story with "and we got a bitcoin which we sold for X at Mt. Gox (or wherever) the proceeds were donated to xyz foundation for the arts and orphans." No problems or conflicts there. XYZ is unaffected by and change in btc value because they got cash. Selling the coin on the currency exchange was an arms length transaction thru a broker, so again no real problems there in terms of conflict. It was totally unnecessary to destroy their private key.
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Now they've donated the value of the coins to every other bitcoin hodler.
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I mean I can put a stack of $100 bills in the fireplace too and they will also be 'gone forever' as far as I am concerned personally. Its not like I can phone of the fed and ask them to print me some new ones.
Actually, if the bills are less than 50% destroyed - you can return what’s left to the Department of the Treasury and ask them to replace it. Of course, they have to be able to convince themselves that your claim is valid - it’s not a given they’ll give you the (equivalent) cash back.
I remember reading an interesting article about the team responsible for verifying these claims (in the US) probably three decades or more ago - back when newspapers and print magazines still roamed the earth.
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> I mean I can put a stack of $100 bills in the fireplace too and they will also be 'gone forever' as far as I am concerned personally. Its not like I can phone of the fed and ask them to print me some new ones.
http://bep.gov/services/curren... [bep.gov]
Though they note:
> Whoever mutilates currency with the intent to render it unfit to be reissued may be fined and/or imprisoned. 18 U.S.C. 333;
And so they'll probably both fine/imprison you and "print you some new ones".
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Its not so much about how they lost a bitcoin its more about how they purposefully destroyed it!
I mean I can put a stack of $100 bills in the fireplace too and they will also be 'gone forever' as far as I am concerned personally. Its not like I can phone of the fed and ask them to print me some new ones.
Frankly the people at Wired are stupid, most journalists these days are, so no surprise there.
To be clear, not only does WIRED not benefit - they effectively removed the benefit of the BTC from the universe. So not only does the BTC value not benefit WIRED, it also cannot benefit anyone else. Basically, imagine if Apple had given them $100k worth of MacBooks and iPads to review, and then in order to maintain their "integrity" they arranged to have the devices destroyed. That's just waste for nothing.
Gimme a break (Score:2)
Frankly the people at Wired are stupid, most journalists these days are, so no surprise there.
Oh give me one big frickin' break, Elmer. Typical Slashdot response - blame the victims.
The people at Wired at just regular people juggling many things to do, and not necessarily Aspie addled, parent basement dwelling, numb nuts who obsess over crypto currency. Yes, it's unfortunate that they lost the keys, and yes it is ultimately their fault, but that doesn't make them stupid. Just makes them human.
In fact, this really points the finger back at techies like us here. We (the greater "we") created a
Bank loses encryption keys (Score:2)
I am waiting for the day that we hear that some bank had backed up their encryption keys on tapes that were encrypted using those keys. Easy to do in a complex environment. An HSM fails and poof, everything gone.
Dear customer, please send us a recent copy of your statement (that we don't send you any more) so that we can figure out what your balance is...
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I am waiting for the day that we hear that some bank had backed up their encryption keys on tapes that were encrypted using those keys.
The IRS are already experts in doing that:
"The disk where I stored my emails crashed. I sent the emails to other people, but their disks also crashed. We had backups, but those tapes have been recycled."
If you want to lose something . . . you can.
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Sounds like Hillary Clinton - or Lois Lerner. They seem to have the WORST luck with computers....
MISLEADING (Score:1)
They destroyed the key ON PURPOSE. They lost nothing.
Easy to explain (Score:4, Funny)
WIRED bought $200,000 worth of Bitcoins on january 6th.
Someone in the NSA (Score:2)
Wait... (Score:2)
Wait a minute... someone LOST money on Bitcoin?!
I've never heard of anyone admitting that. Only that they made some money, got their original investment out, and then lost the profit, or that they made Lambo-kinda money.
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As I read the fine article, they only lost money because they lost access to their wallet and cannot convert them back to money. The coins still belong to them, and will, forever.
"Here's the thing about bitcoins" (Score:2)
If they don't have the password (Score:2)
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Yeah... it's likely that someone at Wired spent the Bitcoin on blow and then conveniently "lost" the private key to cover their tracks.
OP is misleading (Score:5, Informative)
"We lost our key"
isn't the same as (from TFA):
"..."We talked about donating it to a journalism institution, or setting it aside as a scholarship. But we decided that if we gained any benefit from it at all, it would color our future coverage of bitcoin," says Calore. "So we just destroyed the key, knowing full well that it could eventually be worth six or seven figures." McMillan then posted a story announcing the key had been ripped to pieces."
So they didn't LOSE the key, they deliberately and with forethought and recognition of the consequences, destroyed the key.
This is a rather stupid article; essentially it's about how a bunch of people pursued a course of action that...had pretty nearly exactly the result they expected.
Slow news day, Wired?
Re: OP is misleading (Score:1)
Look for the quiet guy (Score:4, Insightful)
We lost [ or destroyed ] our private key, a 64-digit string of random numbers that not one of us remembers
Although all it needs is for 1 copy to still exist. You'd think that someone in the office would have thought "There's zero cost to me keeping a note of that -- what the hell".
P.S. have they tried looking under the keyboard?
The next wave in cryptocurrency (Score:2)
If people are spending tons of money on equipment and electricity to mine bitcoin, what's to stop people from using the hardware to crack the private key?
QC (Score:2)
If you lose the car keys... (Score:2)
...even on Mars, you still have the car.
Like most car analogies, this sucks.
Let me try it. You parked your car in a generic parking garage without plates and you can't remember which garage or which city.
Wired is crap (Score:3)
Yup, that's definitely written by a Wired "journalist".
wait what? isn't Wired a tech-leaning journalism. (Score:2)
and they don't backup their systems?
Just stop! (Score:1)
Meh (Score:2)
Backups! (Score:2)
How could people as tech-savvy as the Wired staff have failed to record - and BACK UP - their bitcoin key? "The palest ink is better than the most retentive memory."
All they have to do is wait (Score:2)
In reserve (Score:1)
Don't be so sure one of your sys admins won't manage to "find" it, WIRED.
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Hope you had fun at that party.
Ummm... (Score:5, Informative)
The linked article actually says they deliberately destroyed the key - to keep their journalistic integrity in the future.
What a pity there's no such thing as integrity on Slashdot these days. The editors have stopped reading even their own articles.
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Intentionally throwing away the key was a totally stupid decision, because they had nothing to lose by just writing the key on a Post-It and stashing it in the bank. Journalistic integrity would not have been compromised had they openly acknowledged mining the coin.As as mentioned in teh article, they could have given the key to charity or set up a scholarship fund with it.
In fact, because throwing away a key benefits all other Bitcoin owners by reducing the money supply, that action actually makes the bad
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You could just cancel your subscription like I did. Or go on ranting about Apple fanbois and Winblows, just like all the other cave dwellers that haven't progressed past dialup BBSs, ASCII pr0n, and FIDO.
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