Another Bitcoin company has fallen victim of a massive cyberheist. BIPS, one of the largest European Bitcoin payment processors, lost 1,295 Bitcoin (currently worth $1 million) after a cyberattack.
As the price of Bitcoin continues to rise, cybercriminals are targeting companies with large holdings of Bitcoins in their servers. The attack on BIPS happened just a few weeks after inputs.io, which allegedly lost 4,100 BTC, worth more than $1 million at the time.
SEE ALSO: Bitcoin Goes to Washington: The Case for and Against Digital Currency
Hackers launched their initial Distributed Denial of Service (DDoS) attack on BIPS on Nov. 15, the company wrote in a Reddit post. The hackers attacked again on Nov. 17, overloading BIPS servers and somehow getting access to several online wallets, which allowed them to steal the 1,295 BTC.
BIPS, which claims to have more than 20,000 customers, offered free online wallets to store their Bitcoin online. It also offers a payment processors for merchants who want to accept payments in Bitcoin.
The company released a statement saying the attack compromised "several consumer wallets." However, it didn't specify how many accounts were hacked. BIPS' CEO Kris Henriksen told Mashable that "most of the missing funds were from our company’s own holdings," but declined to be interviewed for lack of time. "This is my fifth day without sleep," he added in an email.
After the attack, Henriksen advised his customers to avoid online wallets altogether, despite the fact that his company offered them to users. BIPS' online wallet service is now suspended.
"Attacks are not isolated to us, and if you are storing larger amounts of coins with any third party, you may want to find alternative storage solutions as soon as possible," he wrote in a BitcoinTalk forum message.
"Web Wallets are like a regular wallet that you carry cash in and not meant to keep large amounts in," he added.
But several BIPS customers, who still don't know if they'll ever get their Bitcoin back, aren't convinced by Henriksen's advice, saying he never warned them of any danger before the attack. On the contrary, the company said it was secure.
Responding to Henriksen's claim that web wallets are only meant for little amounts of Bitcoin, a BitcoinTalk forum user that goes by the name of Cubicdissection said: "At NO point did you EVER say hey you shouldn't keep your BTC with us."
"In fact, your website said: 'Your data is secure at BIPS.' So yeah, I felt pretty goddamn secure leaving my BTC balance there," he added. "Why don't you speak in plain English and quit giving us the runaround? Because it makes me think you're a liar and have something to hide."
Another user, nicknamed Genghis34, said he had 90 Bitcoin (around $73,000) in his BIPS wallet. He his now asking other victims to sign up online to form a group to potentially sue BIPS and use the threat of a lawsuit as a "negotiating block" for a settlement.
Henriksen's conclusion that online wallets aren't safe echoes what the founder of inputs.io said after his website's loss of 4,100 Bitcoin.
"I don't recommend storing any Bitcoins accessible on computers connected to the Internet," he wrote at the time.
But for victims of the BIPS heist, these warnings come too little too late.
"Bitcoin is the wild west," wrote Genghis34. "And I really doubt this was intentional on the part of bips.me — just probably overconfidence to run a wallet service without proper security."
2013年12月1日 星期日
A Bitcoin Puzzle: Heads, It’s Excitement. Tails, It’s Anxiety
Bitcoin isn’t ready for popular consumption, and it may never be.
It doesn’t fit into a neat product category. Often called a virtual currency, it’s not legal tender anywhere on the planet. It’s not an income-generating asset class suitable for most investors. Its value, in dollars, fluctuates wildly from one minute to the next. And while it can be a cheap way of transferring money, there are too many glitches in its emerging network for bitcoin to be entirely reliable.
Even its advocates have been raising red flags. As Patrick Murck, general counsel for the Bitcoin Foundation, a nonprofit devoted to “fostering the bitcoin ecosystem,” acknowledged in a Senate hearing last week, “It’s very much still an experimental currency and it should be considered a high-risk environment for consumers and investors at the moment.”
Yet bitcoin has been receiving plenty of attention, and not just because well-publicized speculators have been making money on it.
High-risk experiment though it may be, bitcoin embodies an elegant and disruptive technology. It uses file-sharing, the peer-to-peer computer innovation that spawned early music services like Napster, Kazaa and LimeWire. In their early days, they sometimes walked on the wild side, but their experiences led to a wholesale digital transformation of the music business.
Bitcoin gives file-sharing a brilliant twist. In essence, it has created “a decentralized virtual currency that uses a peer-to-peer consensus system to confirm and verify transactions,” two researchers at the Federal Reserve Bank of St. Louis concluded in a recent study. And François R. Velde, a senior economist at the Federal Reserve Bank of Chicago, made this assessment in a new report on bitcoin: “It represents a remarkable conceptual and technical achievement, which may well be used by existing financial institutions (which could issue their own bitcoins) or even by governments themselves.”
It doesn’t fit into a neat product category. Often called a virtual currency, it’s not legal tender anywhere on the planet. It’s not an income-generating asset class suitable for most investors. Its value, in dollars, fluctuates wildly from one minute to the next. And while it can be a cheap way of transferring money, there are too many glitches in its emerging network for bitcoin to be entirely reliable.
Even its advocates have been raising red flags. As Patrick Murck, general counsel for the Bitcoin Foundation, a nonprofit devoted to “fostering the bitcoin ecosystem,” acknowledged in a Senate hearing last week, “It’s very much still an experimental currency and it should be considered a high-risk environment for consumers and investors at the moment.”
Yet bitcoin has been receiving plenty of attention, and not just because well-publicized speculators have been making money on it.
High-risk experiment though it may be, bitcoin embodies an elegant and disruptive technology. It uses file-sharing, the peer-to-peer computer innovation that spawned early music services like Napster, Kazaa and LimeWire. In their early days, they sometimes walked on the wild side, but their experiences led to a wholesale digital transformation of the music business.
Bitcoin gives file-sharing a brilliant twist. In essence, it has created “a decentralized virtual currency that uses a peer-to-peer consensus system to confirm and verify transactions,” two researchers at the Federal Reserve Bank of St. Louis concluded in a recent study. And François R. Velde, a senior economist at the Federal Reserve Bank of Chicago, made this assessment in a new report on bitcoin: “It represents a remarkable conceptual and technical achievement, which may well be used by existing financial institutions (which could issue their own bitcoins) or even by governments themselves.”
Bitcoin Black Friday Lists Sales and Discounts for Bitcoin Purchases
Web: If you are looking to spend some bitcoins this Black Friday, then Bitcoin Black Friday has a listing of all the sales and some exclusive discounts for bitcoin-only purchases.P
The value of bitcoin recently went past $1000, so if you have a few in your e-wallet and are looking to spend them during Black Friday, this should get you some great deals. P
There's a wide variety in the dealers that have already signed up. You can buy Reddit gold for a cheaper price, unlocked phones from GSM Nation, art, t-shirts and much more. Discounts start on November 29, with a promise of more to come.P
We have already shown you some of the best apps and websites for holiday shopping deals, but Bitcoin Black Friday even has a charity element to it, featuring merchants who let you buy and give (like the Humble Bundle) or straight donations to charitable organisations.P
The value of bitcoin recently went past $1000, so if you have a few in your e-wallet and are looking to spend them during Black Friday, this should get you some great deals. P
There's a wide variety in the dealers that have already signed up. You can buy Reddit gold for a cheaper price, unlocked phones from GSM Nation, art, t-shirts and much more. Discounts start on November 29, with a promise of more to come.P
We have already shown you some of the best apps and websites for holiday shopping deals, but Bitcoin Black Friday even has a charity element to it, featuring merchants who let you buy and give (like the Humble Bundle) or straight donations to charitable organisations.P
Bitcoin payments with a simple tap? Multi-purpose nio Card gets added functionality
A British startup called Bluenio has revealed what it claims is the world’s first Bitcoin payment smartcard – or at least it will be if no others have popped up by the time it ships in March.
Bluenio is already in the middle of a Kickstarter campaign for the nio Card, which was initially pitched as a security chain for helping to cut down on the loss of smartphones and wallets. It still does that – it does a few things, actually — but on Friday the company said it would also function as a Bitcoin wallet-slash-payment-card that can transfer money “in a single tap” using near-field communication (NFC) technology.
Easier Bitcoin payments
“It’s a cool way to provide secure Bitcoin payments in a way you currently can’t do,” Bluenio co-founder Ben Hounsell told me. “The way of making a Bitcoin payment right now can be a little bit convoluted, or certainly not as easy as making a traditional chip-and-PIN payment or a tap. You have to scan a QR code, read it in, validate the payment, enter private keys… it can be quite irritating.”
nioCard_bitcoin“Having a card where you tap to make a payment securely bring s [Bitcoin] in line with more conventional ways of making payments.”
You can already get Bitcoin wallet apps for Android devices that allow funds to be paid and received via NFC. However, nio Card allows owners of iOS devices, which unlike most modern Android phones do not have built-in NFC technology, to enjoy the same convenience.
Ultimately, Bluenio would like the nio Card to be able to replace traditional payment cards, Coin-style, but the company hasn’t struck the necessary deals with the banks yet. Europe largely uses chip-and-PIN cards, which are more advanced and secure than the magnetic-strip norm over the U.S., but that means you can’t simply swipe in any old card and have the device replace it, as you can with Coin.
Bluenio is already in the middle of a Kickstarter campaign for the nio Card, which was initially pitched as a security chain for helping to cut down on the loss of smartphones and wallets. It still does that – it does a few things, actually — but on Friday the company said it would also function as a Bitcoin wallet-slash-payment-card that can transfer money “in a single tap” using near-field communication (NFC) technology.
Easier Bitcoin payments
“It’s a cool way to provide secure Bitcoin payments in a way you currently can’t do,” Bluenio co-founder Ben Hounsell told me. “The way of making a Bitcoin payment right now can be a little bit convoluted, or certainly not as easy as making a traditional chip-and-PIN payment or a tap. You have to scan a QR code, read it in, validate the payment, enter private keys… it can be quite irritating.”
nioCard_bitcoin“Having a card where you tap to make a payment securely bring s [Bitcoin] in line with more conventional ways of making payments.”
You can already get Bitcoin wallet apps for Android devices that allow funds to be paid and received via NFC. However, nio Card allows owners of iOS devices, which unlike most modern Android phones do not have built-in NFC technology, to enjoy the same convenience.
Ultimately, Bluenio would like the nio Card to be able to replace traditional payment cards, Coin-style, but the company hasn’t struck the necessary deals with the banks yet. Europe largely uses chip-and-PIN cards, which are more advanced and secure than the magnetic-strip norm over the U.S., but that means you can’t simply swipe in any old card and have the device replace it, as you can with Coin.
Bitcoin Going Off The Rails On A Crazy Train
On Monday I wrote an article for TheStreet.com about the psychology of the Bitcoin craze. Since that article it had rallied another 50% into early trading on Friday. According to Bitcoincharts.com, the price is at $1213 as I write this post.
Part of the equation for the currency is that it is not inflationary, which is supposed to be in contrast to central banks which are inflationary by the nature of their policies. The chart captures the price action and I took the screenshot where the cursor hovered over a time from early in the year when the price was below $25.
Although Bitcoin is intended to be a currency, this sort of volatility hurts the chances that it can be widely adopted at some point (I realize some are using it for transactions). This is not to say Bitcoin should not exist, people should be able to speculate on whatever they want to and own the consequences good or bad but a vehicle for speculation (up 50% in a couple of days) makes for a poor choice for a currency.
Typically when a chart goes vertical as the Bitcoin chart has, it comes back down almost as fast (check out Andrea Electronics (OTCQB:ANDR) and Comparator Systems). If you can point to an instance where something went vertical and did not subsequently crash, please leave a comment with the particulars.
If it turns out that years of ZIRP and QE have distorted markets leading to some horrible consequence, then things like the mania with Bitcoin will be looked back at and with full conviction of hindsight bias we will regularly hear things like "we knew Bitcoin was a warning." In past posts I have noted that the equity markets have defied consequence and maybe there will never be a consequence from the last few years, but the divergence of the S&P 500's fortunes and Main Street's fortunes should at least increase your index of suspicion.
Part of the equation for the currency is that it is not inflationary, which is supposed to be in contrast to central banks which are inflationary by the nature of their policies. The chart captures the price action and I took the screenshot where the cursor hovered over a time from early in the year when the price was below $25.
Although Bitcoin is intended to be a currency, this sort of volatility hurts the chances that it can be widely adopted at some point (I realize some are using it for transactions). This is not to say Bitcoin should not exist, people should be able to speculate on whatever they want to and own the consequences good or bad but a vehicle for speculation (up 50% in a couple of days) makes for a poor choice for a currency.
Typically when a chart goes vertical as the Bitcoin chart has, it comes back down almost as fast (check out Andrea Electronics (OTCQB:ANDR) and Comparator Systems). If you can point to an instance where something went vertical and did not subsequently crash, please leave a comment with the particulars.
If it turns out that years of ZIRP and QE have distorted markets leading to some horrible consequence, then things like the mania with Bitcoin will be looked back at and with full conviction of hindsight bias we will regularly hear things like "we knew Bitcoin was a warning." In past posts I have noted that the equity markets have defied consequence and maybe there will never be a consequence from the last few years, but the divergence of the S&P 500's fortunes and Main Street's fortunes should at least increase your index of suspicion.
Second major Bitcoin heist this month allegedly takes over $1 million
Hackers have allegedly stolen over a thousand bitcoins from the European payment processor BIPS in a theft that's now valued at over $1 million. BIPS tells Mashable that most of the bitcoins — 1,295 in total — came from the company's own holdings, but "several consumer wallets" were also compromised in the hack. The payment provider says that it was initially hit with a DDoS attack on November 15th, followed by a second attack on November 17th that managed to take the funds. Though BIPS disclosed some information on the attack just two days later, full details don't appear to have been given until last Friday.
"YOU MAY WANT TO FIND ALTERNATIVE STORAGE SOLUTIONS AS SOON AS POSSIBLE."
BIPS says that the attacks appear to have originated from Russia and neighboring countries. It's now turning to law enforcement for help, but BIPS says that it'll first ask users for permission to turn over data about their bitcoins. Even with law enforcement's involvement though, users likely won't be seeing their lost bitcoins again — and at a time when they're becoming increasingly valuable. Because of the rapid fluctuation of Bitcoin's price, the stolen bitcoins were only worth around $650,000 at the time of the alleged theft, while they're now significantly more valuable.
Since the hacks, BIPS — which offers a free online wallet for storing Bitcoin — has been telling bitcoin owners that they should really be storing large quantities of the digital currency offline, where it can't be hacked. "Web wallets are like a regular wallet that you carry cash in and not meant to keep large amounts in," Kris Henriksen, BIPS founder, writes in a forum post. "Please be advised that attacks are not isolated to us and if you are storing larger amounts of coins with any third party you may want to find alternative storage solutions as soon as possible."
Another major hack took around 4,100 bitcoins from the wallet service Inputs.io earlier this month, then worth over $1 million as well. While Bitcoin hacks have contributed to crashes in the currency's pricing in the past, Bitcoin has only been rising lately — likely only making the currency all the more attractive to hackers.
"YOU MAY WANT TO FIND ALTERNATIVE STORAGE SOLUTIONS AS SOON AS POSSIBLE."
BIPS says that the attacks appear to have originated from Russia and neighboring countries. It's now turning to law enforcement for help, but BIPS says that it'll first ask users for permission to turn over data about their bitcoins. Even with law enforcement's involvement though, users likely won't be seeing their lost bitcoins again — and at a time when they're becoming increasingly valuable. Because of the rapid fluctuation of Bitcoin's price, the stolen bitcoins were only worth around $650,000 at the time of the alleged theft, while they're now significantly more valuable.
Since the hacks, BIPS — which offers a free online wallet for storing Bitcoin — has been telling bitcoin owners that they should really be storing large quantities of the digital currency offline, where it can't be hacked. "Web wallets are like a regular wallet that you carry cash in and not meant to keep large amounts in," Kris Henriksen, BIPS founder, writes in a forum post. "Please be advised that attacks are not isolated to us and if you are storing larger amounts of coins with any third party you may want to find alternative storage solutions as soon as possible."
Another major hack took around 4,100 bitcoins from the wallet service Inputs.io earlier this month, then worth over $1 million as well. While Bitcoin hacks have contributed to crashes in the currency's pricing in the past, Bitcoin has only been rising lately — likely only making the currency all the more attractive to hackers.
Hard drive containing £4m in bitcoins trashed
James said he was devastated when he realised what he had done: "I was in front of my computer, the drawer where the drive was kept was only a few yards away and the first thing I did was move to that drawer, and look, even though I knew it wasn't there, it was still the first thing I did."
"From the very first time I came across bitcoin I knew it was going to be a good investment and I knew it was going to be the next big thing. I mean, devastating really. What else can I say?" he added.
Bitcoin trades 24 hours a day, every day. The supply of the currency, which is "mined" by solving math problems, is limited, and recently stood at 12 million bitcoins, worth about £8 billion at recent prices.
"From the very first time I came across bitcoin I knew it was going to be a good investment and I knew it was going to be the next big thing. I mean, devastating really. What else can I say?" he added.
Bitcoin trades 24 hours a day, every day. The supply of the currency, which is "mined" by solving math problems, is limited, and recently stood at 12 million bitcoins, worth about £8 billion at recent prices.
Weekly Security review: NSA, Bitcoin robbers at it again
Quite a few familiar headlines cropped up this week, with Edward Snowden leaking yet more classifying documents detailing the NSA’s cyber-espionage operations. The latest reports indicate that the agency infiltrated tens of thousands of networks around the world using specialized hardware designed from the ground up to collect sensitive information.
A slide dated 2012 outlines the NSA’s use of “Computer Network Exploitation” or CNE throughout more than 50,000 locations worldwide, spanning 20 “Access Programs” and five continents. SiliconANGLE CyberSecurity Editor John Casaretto observed that the agency uses the same tactics employed by hacktivists and cyber criminals to operate digital sleeper cells that can be activated as needed to siphon information from infected end-points.
The NSA has a deep bag of tricks. Besides operating sophisticated command-and-control networks, it also taps fiber-optic connections to eavesdrop major tech companies. Google and Yahoo insiders reportedly believe that the spy agency compromised undersea cabling operated by providers like Verizon Communications and Level 3 Communications to intercept their data center traffic.
While still at the center of the Snowden controversy, the NSA’s spying activities have been overshadowed by the revelation that the whistleblower possesses a “doomsday” cache believed to contain personal information belonging to U.S. and allied intelligence personnel. The highly classified documents that some suspect to be stashed away in the cloud contain names and resumes of employees working for the UK’s Government Communications Headquarters, according to “sources familiar with the matter.”
A slide dated 2012 outlines the NSA’s use of “Computer Network Exploitation” or CNE throughout more than 50,000 locations worldwide, spanning 20 “Access Programs” and five continents. SiliconANGLE CyberSecurity Editor John Casaretto observed that the agency uses the same tactics employed by hacktivists and cyber criminals to operate digital sleeper cells that can be activated as needed to siphon information from infected end-points.
The NSA has a deep bag of tricks. Besides operating sophisticated command-and-control networks, it also taps fiber-optic connections to eavesdrop major tech companies. Google and Yahoo insiders reportedly believe that the spy agency compromised undersea cabling operated by providers like Verizon Communications and Level 3 Communications to intercept their data center traffic.
While still at the center of the Snowden controversy, the NSA’s spying activities have been overshadowed by the revelation that the whistleblower possesses a “doomsday” cache believed to contain personal information belonging to U.S. and allied intelligence personnel. The highly classified documents that some suspect to be stashed away in the cloud contain names and resumes of employees working for the UK’s Government Communications Headquarters, according to “sources familiar with the matter.”
What is Bitcoin and how is it used?
Virtual currencies, or digital cash, are gaining popularity as a new way to purchase goods or services. They are not regulated or issued by a central bank. The most popular virtual currency is Bitcoin, which soared above $1,000 for the first time on Wednesday.
Things you need to know about Bitcoins:
What is Bitcoin? It is a digital currency that is created and exchanged independently of any government or bank. The currency is generated through a computer program and can be converted into cash after being deposited into virtual wallets. When Bitcoin was launched? In 2008, a programmer known as Satoshi Nakamoto - a name believed to be an alias - posted a paper outlining Bitcoin's design and later in 2009 released software that can be used to exchange Bitcoins using the scheme. That software is now maintained by an open-source community coordinated by developers. How does Bitcoin work? It exists through an open-source software program and its supply is controlled by a computer algorithm. Once you download and run the Bitcoin client software, it connects over the Internet to the decentralized network of all Bitcoin users and also generates a pair of unique, mathematically linked keys, which you'll need to exchange Bitcoins with any other client. One key is private and kept hidden on your computer. The other is public and a version of it dubbed a Bitcoin address is given to other people so they can send you Bitcoins. How Bitcoins are generated? The process of generating Bitcoins is quite complicated and involves solving complex algorithms and sharing the solution with the entire network. The "mining" is very computationally intensive and requires powerful computers. How to transfer Bitcoins: When you perform a transaction, your Bitcoin software performs a mathematical operation to combine the other party's public key and your own private key with the amount of Bitcoins that you want to transfer. The result of that operation is then sent out across the distributed Bitcoin network so the transaction can be verified by Bitcoin software clients not involved in the transfer. How to trade Bitcoins: Exchanges like Mt. Gox provide a place for people to trade Bitcoins for other types of currency. Payments to a merchant who accepts Bitcoins are made from the wallet application, either on your computer or smartphone, by entering the recipient's address, the payment amount. Who controls the Bitcoin network: It is controlled by all Bitcoin users around the world. While developers improve the software, they can't force a change in the Bitcoin protocol because the virtual currency can only work correctly only if there is a consensus among all users. Bitcom transactions: At the end of August 2013, the value of all Bitcoins in circulation exceeded $1.5 billion with millions of dollars worth of Bitcoins exchanged daily, according to Bitcom website. (With Agency inputs)
Things you need to know about Bitcoins:
What is Bitcoin? It is a digital currency that is created and exchanged independently of any government or bank. The currency is generated through a computer program and can be converted into cash after being deposited into virtual wallets. When Bitcoin was launched? In 2008, a programmer known as Satoshi Nakamoto - a name believed to be an alias - posted a paper outlining Bitcoin's design and later in 2009 released software that can be used to exchange Bitcoins using the scheme. That software is now maintained by an open-source community coordinated by developers. How does Bitcoin work? It exists through an open-source software program and its supply is controlled by a computer algorithm. Once you download and run the Bitcoin client software, it connects over the Internet to the decentralized network of all Bitcoin users and also generates a pair of unique, mathematically linked keys, which you'll need to exchange Bitcoins with any other client. One key is private and kept hidden on your computer. The other is public and a version of it dubbed a Bitcoin address is given to other people so they can send you Bitcoins. How Bitcoins are generated? The process of generating Bitcoins is quite complicated and involves solving complex algorithms and sharing the solution with the entire network. The "mining" is very computationally intensive and requires powerful computers. How to transfer Bitcoins: When you perform a transaction, your Bitcoin software performs a mathematical operation to combine the other party's public key and your own private key with the amount of Bitcoins that you want to transfer. The result of that operation is then sent out across the distributed Bitcoin network so the transaction can be verified by Bitcoin software clients not involved in the transfer. How to trade Bitcoins: Exchanges like Mt. Gox provide a place for people to trade Bitcoins for other types of currency. Payments to a merchant who accepts Bitcoins are made from the wallet application, either on your computer or smartphone, by entering the recipient's address, the payment amount. Who controls the Bitcoin network: It is controlled by all Bitcoin users around the world. While developers improve the software, they can't force a change in the Bitcoin protocol because the virtual currency can only work correctly only if there is a consensus among all users. Bitcom transactions: At the end of August 2013, the value of all Bitcoins in circulation exceeded $1.5 billion with millions of dollars worth of Bitcoins exchanged daily, according to Bitcom website. (With Agency inputs)
Bitcoin-Litecoin Ratio Returns to Historic Norm, Peercoin Climbs 200%
As bitcoin continues to climb to record highs, reaching as high as $1,141 on Bitstamp, it is joined in growth by a number of alternative digital currencies. The most visible has been litecoin, which has returned to what might be considered a normal trading range relative to bitcoin. Litecoin is not alone in its gains, with others like Peercoin and Namecoin making similar gains.
The rise of litecoin has made numerous headlines over the past week, surprising many with its meteoric gains and crossing of one billion dollars of market capitalization. Yet, the dynamics in which it is actually traded are often overlooked, particularly its relationship to bitcoin. On BTC-e, the leading litecoin exchange by volume, the bitcoin-litecoin currency pair is traded with as much or more volume as litecoin-dollar. It also regularly dictates movement as visible through a series of technical factors.
The rise of litecoin has made numerous headlines over the past week, surprising many with its meteoric gains and crossing of one billion dollars of market capitalization. Yet, the dynamics in which it is actually traded are often overlooked, particularly its relationship to bitcoin. On BTC-e, the leading litecoin exchange by volume, the bitcoin-litecoin currency pair is traded with as much or more volume as litecoin-dollar. It also regularly dictates movement as visible through a series of technical factors.
In Bitcoin’s Orbit: Rival Virtual Currencies Vie for Acceptance
For many people, bitcoin seems like something from the day after tomorrow.
For Lawrence Blankenship, it’s already a thing of the past.
A software engineer from Springfield, Mo., Mr. Blankenship is putting his money on PeerCoin, one of the biggest of the virtual currencies that are being promoted as alternatives to bitcoin.
With mounting interest from prominent investors and growing acceptance from regulators, bitcoin — either the new gold or the next Dutch tulip craze, depending on who is being asked — is at the center of the virtual money universe. Yet there are dozens of digital alternatives, like PeerCoin, Litecoin and anoncoin, whose backers point to advantages they say their currency has over bitcoin.
PeerCoin, according to Mr. Blankenship, is closer than bitcoin to the perfect, communal money. Mr. Blankenship, who is 34, has arranged to accept PeerCoin as the virtual currency of choice at a Star Trek convention he is organizing in his hometown.
“Looking down the road 10 years from now, I definitely see bitcoin being ousted,” he said. “Everyone’s going to start switching to other coins, and hopefully PeerCoin comes out ahead in that.”
In the alternative galaxy of virtual currencies, newly created money can become worth millions of real dollars in a few months. All the PeerCoin in existence, for example, was worth nearly $40 million last week. Programmers and mathematicians release new entrants into the field almost every week. On one popular exchange, Cryptsy, 60 different coins can now be traded.
Almost all of these altcoins, as they are known, have fed on the stratospheric rise of bitcoin. Since the beginning of the month, the value of bitcoin rose to more than $900 at one point, from $200, and it is up 6,000 percent since the beginning of the year.
For Lawrence Blankenship, it’s already a thing of the past.
A software engineer from Springfield, Mo., Mr. Blankenship is putting his money on PeerCoin, one of the biggest of the virtual currencies that are being promoted as alternatives to bitcoin.
With mounting interest from prominent investors and growing acceptance from regulators, bitcoin — either the new gold or the next Dutch tulip craze, depending on who is being asked — is at the center of the virtual money universe. Yet there are dozens of digital alternatives, like PeerCoin, Litecoin and anoncoin, whose backers point to advantages they say their currency has over bitcoin.
PeerCoin, according to Mr. Blankenship, is closer than bitcoin to the perfect, communal money. Mr. Blankenship, who is 34, has arranged to accept PeerCoin as the virtual currency of choice at a Star Trek convention he is organizing in his hometown.
“Looking down the road 10 years from now, I definitely see bitcoin being ousted,” he said. “Everyone’s going to start switching to other coins, and hopefully PeerCoin comes out ahead in that.”
In the alternative galaxy of virtual currencies, newly created money can become worth millions of real dollars in a few months. All the PeerCoin in existence, for example, was worth nearly $40 million last week. Programmers and mathematicians release new entrants into the field almost every week. On one popular exchange, Cryptsy, 60 different coins can now be traded.
Almost all of these altcoins, as they are known, have fed on the stratospheric rise of bitcoin. Since the beginning of the month, the value of bitcoin rose to more than $900 at one point, from $200, and it is up 6,000 percent since the beginning of the year.
Bitcoin (BTC) cryptocurrency value tops $1,000 for first time
Dan Held, an expert in tracking the bitcoin market, told the website: “China is still driving overall demand. However, I think there has been a paradigm shift in how people think about Bitcoin in the US.
“Over the last few days, my friends, parents’ friends, and people that I never thought would buy bitcoin have contact me, not asking ‘what is bitcoin,’ but ‘how do I get bitcoin?”
Bitcoin has seen a surge in value in recent weeks after it received recognition from a series of major businesses and authorities across the world.
It featured in a US Senate hearing last week to consider the possibility it could be placed under American regulation.
In a letter written ahead of the congressional hearings US Federal Reserve chairman Ben Bernanke states that although the Federal Reserve “does not necessarily have authority to directly supervise or regulate” virtual currencies, such innovations may hold “long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”
“In general,” writes Bernanke, “the Federal Reserve would only have authority to regulate a virtual currency product if it is issued by, or cleared or settled through, a banking organization that we supervise.”
It was also announced by Sir Richard Branson that his space tourism company Virgin Atlantic will start accepting bitcoins as payment.
“All of our future astronauts are pioneers in their own right,” wrote Sir Richard, “and this is one more way to be forward-thinking.”
“Over the last few days, my friends, parents’ friends, and people that I never thought would buy bitcoin have contact me, not asking ‘what is bitcoin,’ but ‘how do I get bitcoin?”
Bitcoin has seen a surge in value in recent weeks after it received recognition from a series of major businesses and authorities across the world.
It featured in a US Senate hearing last week to consider the possibility it could be placed under American regulation.
In a letter written ahead of the congressional hearings US Federal Reserve chairman Ben Bernanke states that although the Federal Reserve “does not necessarily have authority to directly supervise or regulate” virtual currencies, such innovations may hold “long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”
“In general,” writes Bernanke, “the Federal Reserve would only have authority to regulate a virtual currency product if it is issued by, or cleared or settled through, a banking organization that we supervise.”
It was also announced by Sir Richard Branson that his space tourism company Virgin Atlantic will start accepting bitcoins as payment.
“All of our future astronauts are pioneers in their own right,” wrote Sir Richard, “and this is one more way to be forward-thinking.”
Is This The Bitcoin Rout That Was Bound To Happen?
Bitcoin is in freefall this morning as liquidation (volume has picked up during the selling) seems to be taking place after the brief foray with Gold parity over the weekend.
At 1 am AEDT this morning Bitcoins were fetching the still heady price of $1150 US dollars but right now they are trading at $846 and falling so fast it’s hard to get an up-to-date chart.
At 1 am AEDT this morning Bitcoins were fetching the still heady price of $1150 US dollars but right now they are trading at $846 and falling so fast it’s hard to get an up-to-date chart.
As bitcoin booms, so does bitcoin bank robbery
Robbing a bank is such a hassle in the real world, with all the complicated logistics of weapons, vaults, dye packs, and getaway cars. It’s a lot more straightforward to rob digital currency exchanges and payment processors. To paraphrase bank robber Willie Sutton, that’s where the bitcoins are.
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The huge interest in bitcoin and the concurrent surge in the value of the currency—bitcoin has risen 6,000% versus the US dollar in the last year and 300% just this month—has also created a growing incentive for larcenous hackers:
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European bitcoin payment processor BIPS lost the equivalent of about $1 million last week after a distributed denial of service (DDoS) attack overwhelmed its servers and enabled attackers to gain access to customers’ online bitcoin “wallets.”
Poland’s Bidextreme.pl was also hacked last week, and its users’ accounts emptied, though it did not disclose the amount taken.
A week earlier, the Czech exchange Bitcash.cz was hit, with 4,000 users losing bitcoins worth about $100,000.
Australia’s TradeFortress said it was hacked in November, leading to the loss of $1 million worth of users’ bitcoins.
China’s GBL exchange abruptly went offline in October, with $4.1 million in users’ bitcoins going missing.
How do you actually steal a bitcoin, anyway?
Owning bitcoins, as Wired’s extensive survival guide explains, means that you have a private cryptography key that’s associated with a public internet address. You need both to access the money. By exploiting cybersecurity flaws on computer servers, PCs, and mobile phones, thieves who discover both the private key and the public address can transfer the bitcoins to their own accounts to spend as they please or convert into another currency.
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Bitcoin transactions cannot be reversed without the consent of both sender and receiver, so the transfers are irrevocable. The system is designed to shield the identity of its users, but individual bitcoins are traceable.
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“While the ownership of money is implicitly anonymous, its flow is globally visible,” a recent research paper concluded. Forbes contributor Jon Matonis wrote last year about the theft of 46,703 bitcoins, worth $228,845 at the time of the robbery, from a New Jersey-based hosting company called Linode, which could be traced after the theft through servers in dozens of other countries.
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As a one-stop despository of multiple accounts, exchanges make a tempting target, which is why the Bitcoin Foundation warns new users:
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When sending money to an exchange or seller you are trusting that the operator will not abscond with your funds and that the operator maintains secure systems that protect against theft—internal or external. It is recommended that you obtain the real-world identity of the operator and ensure that sufficient recourse is available.
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BIPS, the European payment processor that was hacked last week, has stopped offering online wallet services and has urged customers to avoid online wallets altogether.
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Safe-guarding your own bitcoins can also be fraught, since thieves have exploited security vulnerabilities to steal bitcoins from users’ own computers. Security-conscious users recommend storing bitcoins not in “hot wallets” that are necessary for processing transactions, but rather in “cold storage,” such as a USB drive that is not connected to the internet, or even “deep cold storage,” such as a usb drive that’s stored in a (real world) safety deposit box. Private keys can even be written on pieces of paper—or engraved onto a ring.
+
The huge interest in bitcoin and the concurrent surge in the value of the currency—bitcoin has risen 6,000% versus the US dollar in the last year and 300% just this month—has also created a growing incentive for larcenous hackers:
+
European bitcoin payment processor BIPS lost the equivalent of about $1 million last week after a distributed denial of service (DDoS) attack overwhelmed its servers and enabled attackers to gain access to customers’ online bitcoin “wallets.”
Poland’s Bidextreme.pl was also hacked last week, and its users’ accounts emptied, though it did not disclose the amount taken.
A week earlier, the Czech exchange Bitcash.cz was hit, with 4,000 users losing bitcoins worth about $100,000.
Australia’s TradeFortress said it was hacked in November, leading to the loss of $1 million worth of users’ bitcoins.
China’s GBL exchange abruptly went offline in October, with $4.1 million in users’ bitcoins going missing.
How do you actually steal a bitcoin, anyway?
Owning bitcoins, as Wired’s extensive survival guide explains, means that you have a private cryptography key that’s associated with a public internet address. You need both to access the money. By exploiting cybersecurity flaws on computer servers, PCs, and mobile phones, thieves who discover both the private key and the public address can transfer the bitcoins to their own accounts to spend as they please or convert into another currency.
+
Bitcoin transactions cannot be reversed without the consent of both sender and receiver, so the transfers are irrevocable. The system is designed to shield the identity of its users, but individual bitcoins are traceable.
+
“While the ownership of money is implicitly anonymous, its flow is globally visible,” a recent research paper concluded. Forbes contributor Jon Matonis wrote last year about the theft of 46,703 bitcoins, worth $228,845 at the time of the robbery, from a New Jersey-based hosting company called Linode, which could be traced after the theft through servers in dozens of other countries.
+
As a one-stop despository of multiple accounts, exchanges make a tempting target, which is why the Bitcoin Foundation warns new users:
+
When sending money to an exchange or seller you are trusting that the operator will not abscond with your funds and that the operator maintains secure systems that protect against theft—internal or external. It is recommended that you obtain the real-world identity of the operator and ensure that sufficient recourse is available.
+
BIPS, the European payment processor that was hacked last week, has stopped offering online wallet services and has urged customers to avoid online wallets altogether.
+
Safe-guarding your own bitcoins can also be fraught, since thieves have exploited security vulnerabilities to steal bitcoins from users’ own computers. Security-conscious users recommend storing bitcoins not in “hot wallets” that are necessary for processing transactions, but rather in “cold storage,” such as a USB drive that is not connected to the internet, or even “deep cold storage,” such as a usb drive that’s stored in a (real world) safety deposit box. Private keys can even be written on pieces of paper—or engraved onto a ring.
When bitcoins go bad: 4 stories of fraud, hacking, and digital currencies.
With Bitcoin interest (and prices) spiking, you might be considering investing in your own little cache of digital currency. But before you set up a Bitcoin wallet, you should think long and hard about who will watch over your digital wealth. In its relatively short lifespan, Bitcoin wallets and processors have been a target for hackers -- and old-fashioned fraudsters. In fact, within the last week, one of the most prominent European exchanges reported it had lost over $1 million worth of bitcoins to hackers.
An academic study published earlier this year by Tyler Moore at Southern Methodist University and Nicolas Cristin at Carnegie Mellon about the risks associated with Bitcoin exchanges reported that 18 of 40 services they studied over three years closed "with customer account balances often wiped out." In that study, less popular services were more likely to just disappear than popular exchanges -- but popular exchanges were more likely to suffer security breaches, which have also been blamed for disappearing bitcoins.
Their research supports the anecdotal evidence about the security of various Bitcoin services -- or lack thereof. The forum Bitcoin Talk has a relatively comprehensive list of incidents, but here are a few of the most notable (and costly) stories about investing in Bitcoins going bad.
European payment processor and wallet service loses over $1 million worth of bitcoins
BIPS, a Denmark-based Bitcoin payment processor with a free online wallet service reportedly lost 1,295 bitcoins over the course of a few days earlier this month -- just over $1 million worth at current exchange rates. Coindesk reports that the service was the subject of a series of DDoS attacks that appeared to be connected to the heist. The company's CEO said most of the missing funds were from the company's own holdings, but a statement addressing the incident noted that some users also took a hit
An academic study published earlier this year by Tyler Moore at Southern Methodist University and Nicolas Cristin at Carnegie Mellon about the risks associated with Bitcoin exchanges reported that 18 of 40 services they studied over three years closed "with customer account balances often wiped out." In that study, less popular services were more likely to just disappear than popular exchanges -- but popular exchanges were more likely to suffer security breaches, which have also been blamed for disappearing bitcoins.
Their research supports the anecdotal evidence about the security of various Bitcoin services -- or lack thereof. The forum Bitcoin Talk has a relatively comprehensive list of incidents, but here are a few of the most notable (and costly) stories about investing in Bitcoins going bad.
European payment processor and wallet service loses over $1 million worth of bitcoins
BIPS, a Denmark-based Bitcoin payment processor with a free online wallet service reportedly lost 1,295 bitcoins over the course of a few days earlier this month -- just over $1 million worth at current exchange rates. Coindesk reports that the service was the subject of a series of DDoS attacks that appeared to be connected to the heist. The company's CEO said most of the missing funds were from the company's own holdings, but a statement addressing the incident noted that some users also took a hit
Bitcoin keeps surging, taps new record atop $1,200
MADRID (MarketWatch) -- Bitcoin continued to push higher Friday, touching a new record of $1,242 before pulling back to around $1,183. The virtual currency took out Wednesday's $1,000 high on Thanksgiving Day. The run-up for bitcoin got new life after a congressional hearing earlier this month that effectively gave the currency an official blessing. The currency also elbowed into the holiday shopping season with its own Bitcoin Black Friday promotion involving hundreds of merchants.
Bitcoin passes the $1,000 mark for first time: Digital currency QUADRUPLES its value in less than three weeks
Virtual currency Bitcoin has passed the $1,000 (£613) mark for the first time since it was introduced in 2009.
According to the currency's main exchange, Mt.Gox, the price for a single Bitcoin has almost quadrupled since its previous record high of $267 (£165) less than three weeks ago
Analysts claim the demand for Bitcoin follows increased awareness about benefits of the currency and a drive to move it into the mainstream.
Bitcoins can be bought with near anonymity, which supporters say lowers fraud risk and increases privacy.
The current rises follow the launch of the world’s first Bitcoin ATM, dubbed Robocoin, in a Vancouver coffee shop.
The blue and silver ATM machine, which is operated by Vancouver-based Bitcoiniacs and Nevada-based Robocoin, changes bitcoins to Canadian dollars and vice versa.
Users scan their hand to confirm identity, and then funds move to or from a virtual wallet on their smartphone.
According to the currency's main exchange, Mt.Gox, the price for a single Bitcoin has almost quadrupled since its previous record high of $267 (£165) less than three weeks ago
Analysts claim the demand for Bitcoin follows increased awareness about benefits of the currency and a drive to move it into the mainstream.
Bitcoins can be bought with near anonymity, which supporters say lowers fraud risk and increases privacy.
The current rises follow the launch of the world’s first Bitcoin ATM, dubbed Robocoin, in a Vancouver coffee shop.
The blue and silver ATM machine, which is operated by Vancouver-based Bitcoiniacs and Nevada-based Robocoin, changes bitcoins to Canadian dollars and vice versa.
Users scan their hand to confirm identity, and then funds move to or from a virtual wallet on their smartphone.
Roger Ver, ‘Bitcoin Jesus’, Makes Largest Ever Bitcoin Donation of $1m
Globetrotting bitcoin entrepreneur Roger Ver just made the largest ever charitable bitcoin donation — a million dollars — after ‘losing’ a bet he made with the world about its rise.
The CEO of MemoryDealers and angel investor actually made an initial bet of $10,000 (the value of 1,000 BTC at the time) but recent events have pushed the dollar value into seven figures, setting the record.
“A little over two years ago I made a bet for $10,000 that bitcoin would outperform gold, silver, the US stock market and the US dollar by more than one hundred times over the next two years,” he posted in a video message on YouTube.
“I’m here today to say that I was wrong, In reality it took about two years and two months for bitcoin to outperform everything else by more than a hundred times. Over that time, gold and silver are down, the stock market is up about 45 per cent, but Bitcoin is up more than 15,000 per cent, or more than three hundred times everything else.”
Despite the prediction being off by only a couple of months, Ver decided to obey the letter of the original bet on principle and donate the 1,000 BTC to the Foundation for Economic Education (FEE), “the organization that published the books and articles that allowed me to understand just how important Bitcoin would become.”
His wager would have sounded crazy to an outsider in late 2011. Even though the bet was with the world in general and not any one (unlucky) individual, Ver said no one offered to bet against him.
“One person offered to take the other side after about 85% of the time had already elapsed though,” he said.
That someone was still prepared to take the other side as recently as that is a mark of how much the scenery has changed in the past few months.
In his video, Ver went on to point out the tens of millions of dollars in investment that has flowed to businesses like BitPay, Coinbase and Blockchain.info as they expand into countries around the world. There are now millions of individual bitcoin users who can now use their digital currency for over 70,000 stores on Shopify, or organize their own trades via LocalBitcoins.com.
Ver is one of a fast-growing number of professionals and others whose full-time employment is now based on bitcoin, as it continues to captivate even the non-technology-minded in media, government and the general public.
The CEO of MemoryDealers and angel investor actually made an initial bet of $10,000 (the value of 1,000 BTC at the time) but recent events have pushed the dollar value into seven figures, setting the record.
“A little over two years ago I made a bet for $10,000 that bitcoin would outperform gold, silver, the US stock market and the US dollar by more than one hundred times over the next two years,” he posted in a video message on YouTube.
“I’m here today to say that I was wrong, In reality it took about two years and two months for bitcoin to outperform everything else by more than a hundred times. Over that time, gold and silver are down, the stock market is up about 45 per cent, but Bitcoin is up more than 15,000 per cent, or more than three hundred times everything else.”
Despite the prediction being off by only a couple of months, Ver decided to obey the letter of the original bet on principle and donate the 1,000 BTC to the Foundation for Economic Education (FEE), “the organization that published the books and articles that allowed me to understand just how important Bitcoin would become.”
His wager would have sounded crazy to an outsider in late 2011. Even though the bet was with the world in general and not any one (unlucky) individual, Ver said no one offered to bet against him.
“One person offered to take the other side after about 85% of the time had already elapsed though,” he said.
That someone was still prepared to take the other side as recently as that is a mark of how much the scenery has changed in the past few months.
In his video, Ver went on to point out the tens of millions of dollars in investment that has flowed to businesses like BitPay, Coinbase and Blockchain.info as they expand into countries around the world. There are now millions of individual bitcoin users who can now use their digital currency for over 70,000 stores on Shopify, or organize their own trades via LocalBitcoins.com.
Ver is one of a fast-growing number of professionals and others whose full-time employment is now based on bitcoin, as it continues to captivate even the non-technology-minded in media, government and the general public.
Bitcoin—the world's best boost to a brand?
The debate may continue to rage over whether bitcoin is a viable alternative to the dollar or just another Ponzi scheme, but there's no denying of its ability to boost a brand's awareness.
Billionaire entrepreneur Sir Richard Branson announced on CNBC's "Squawk Box" Friday that his commercial space flight venture will accept bitcoin as payment. His tweet confirming the move received nearly 500 retweets and the corresponding story on CNBC received over 4,000 Facebook shares and was one of the most read articles on the site that day.
Billionaire entrepreneur Sir Richard Branson announced on CNBC's "Squawk Box" Friday that his commercial space flight venture will accept bitcoin as payment. His tweet confirming the move received nearly 500 retweets and the corresponding story on CNBC received over 4,000 Facebook shares and was one of the most read articles on the site that day.
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