Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK • Hacker News Board

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#131

Post by JumpCrisscross » Fri, Jan 26, 2018, 6:41 PM UTC

coralreef wrote: post #103

m3kw9 wrote: post #50

A lot of people take for granted of a bank guarantees from govt. In a bank you are protected if the bank burns down or gets robbed empty. Unlike the Wild West here

Kind of an incorrect analogy. Exchanges aren't banks, they're more like open bazaars. Your own cold wallet is the bank. Once you take the money to the bazaar, it becomes possible to be pick pocketed.

> Exchanges aren't banks, they're more like open bazaars

I believe the SIPC guarantee covers losses incurred as a result of an exchange failure. Practically, I have a hard time understanding how an exchange failing would cause customers to lose funds (outside capital losses). Securities markets segregate exchange and settlement, e.g. the NYSE from the DTCC [1]. The latter is guaranteed, indirectly, by the federal government.

[1] https://en.wikipedia.org/wiki/Depository_Trust_%26_Clearing_...

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#132

Post by ezoe » Fri, Jan 26, 2018, 6:42 PM UTC

When do the people learn? If you hand over the control of your crypto-currency to the central trade authority, it completely ruins the value of crypo-currency.

You should rather use traditional nation-backed currency at regulated trade authority.

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#133

Post by JumpCrisscross » Fri, Jan 26, 2018, 6:42 PM UTC

ReverseCold wrote: post #90

Posting this as a top level comment as well (probably a better idea): The coins stolen are XEM ( https://nem.io/ ) not Bitcoin. They're currently tracking the stolen coins to ensure they are not sold. Preliminary evidence suggests that it was a private key stolen and not a network problem. Disclaimer: Am somewhat associated with the team, and I hold a small amount of XEM. Feel free to ask questions.

Sorry, do you have a source for any of your claims?

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#134

Post by cal5k » Fri, Jan 26, 2018, 6:44 PM UTC

krapp wrote: post #128

cal5k wrote: post #122

Earlier quoted context omitted.

Well, technically only their altcoins were kept in a hot wallet - still, unbelievable incompetence. This is where regulation is sorely needed.

> This is where regulation is sorely needed. The need for financial regulation and trusted authority is supposed to be the problem cryptocurrencies exist to solve - free market forces and reputation alone should be sufficient.

The libertarian dream. Clearly not supported by the libertarian reality. Besides - it's a fantasy to think that exchanges, which by definition deal in fiat currency, would somehow be immune to government regulation.

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#135

Post by dmix » Fri, Jan 26, 2018, 6:44 PM UTC

stuxnet79 wrote: post #27

s0rce wrote: post #7

Wow, didn't know Mt. Gox lost 850k BTC, thats 9B USD at the current price. Are these coins traced? Were they quietly sold or are hackers sitting on billions in BTC?

Kim Nilsson's group have been investigating the Mt Gox incident for years and he gave a presentation some time ago that summarized some of their findings ( https://www.youtube.com/watch?v=l70iRcSxqzo ). One of the best summaries of the Mt Gox incident, as well as the fallout and subsequent investigations that I've watched.

Any TLDW for the primary theory on who did it? Inside job?

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#136

Post by cal5k » Fri, Jan 26, 2018, 6:45 PM UTC

emiliobumachar wrote: post #105

cal5k wrote: post #95

Earlier quoted context omitted.

You can't ban them, but you could put together a "blacklist" on tokens from a particular origin that exchanges could agree to honour. It wouldn't stop anyone from trying to sell their coins in other ways.

That's basically forming a government. Who decides what goes in the list? Who ensures they'll keep honest? Who watches the watchers? What recourse does a user have against arbitrary measures?

A government? It's a list. Until it collects taxes, has a monopoly on violence and provides basic services, a list is just... a list.

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#137

Post by [deleted] » Fri, Jan 26, 2018, 6:46 PM UTC

ReverseCold wrote: post #90

Posting this as a top level comment as well (probably a better idea): The coins stolen are XEM ( https://nem.io/ ) not Bitcoin. They're currently tracking the stolen coins to ensure they are not sold. Preliminary evidence suggests that it was a private key stolen and not a network problem. Disclaimer: Am somewhat associated with the team, and I hold a small amount of XEM. Feel free to ask questions.

[deleted]

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#138

Post by fpgaminer » Fri, Jan 26, 2018, 6:48 PM UTC

m3kw9 wrote: post #50

A lot of people take for granted of a bank guarantees from govt. In a bank you are protected if the bank burns down or gets robbed empty. Unlike the Wild West here

I remember naively believing that FDIC covered theft. There are little notes and placards posted all over banking websites and physical locations advertising that your funds are insured by FDIC. I'll bet most people who see those signs believe the same thing I believed: that "insured" in that context meant your funds were protected. Against theft; fire; fraud; etc. Right?

But FDIC _doesn't_ cover theft. Or anything else. It only covers bank failure. Bank runs were a real problem back in the old days, and the fear of it drove most people to leave their cash in mattresses. So FDIC was created to alleviate those fears and get cash back into the banks. That was, and is, its only purpose.

Not that that isn't a useful thing. It certainly came in handy again during our last recession. But this knowledge raises an important question. If FDIC is the only insurance I've seen advertised by banks, and it only covers bank failure ... what covers everything else?

I assume, hopefully, that banks have private insurance policies or something. Maybe they're legally required to have a private insurance policies. I just don't know. I bet most people don't know.

Very interesting stuff.

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#139

Post by tzahola » Fri, Jan 26, 2018, 6:51 PM UTC

ReverseCold wrote: post #90

Posting this as a top level comment as well (probably a better idea): The coins stolen are XEM ( https://nem.io/ ) not Bitcoin. They're currently tracking the stolen coins to ensure they are not sold. Preliminary evidence suggests that it was a private key stolen and not a network problem. Disclaimer: Am somewhat associated with the team, and I hold a small amount of XEM. Feel free to ask questions.

>and I hold a small amount of XEM.

*held

:^)

Re: Tokyo-based cryptocurrency exchange hacked, losing $530M: NHK

#140

Post by vkou » Fri, Jan 26, 2018, 6:53 PM UTC

csomar wrote: post #130

ReverseCold wrote: post #70

Earlier quoted context omitted.

It's still impossible to have a decentralized exchange convert between USD and a coin. XEM (the coin that was stolen) doesn't have plans to implement 0x, but there are other plans for decentralized exchange.

Why not? By using a usd-token like usdt it become possible. Bitshare usd also has been very stable lately and it is fully decentralized.

A usd-token requires trust that the token issuer isn't just printing magic internet money. You've just moved your point of failure from the exchange, to the token issuer.

All evidence points to USDT being just that - magic internet money, with nothing backing it.