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

reuters.com

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

#291

Post by jowsie »

rhapsodic wrote: post #260
jcoffland wrote: post #82

Earlier quoted context omitted.

> It's not like stocks where you can see actual bid/ask and daily volume numbers. Actually, it's exactly like that. > And since transaction costs and times make arbitrage impractical, the price is not even the same across exchanges. Arbitrage across crypto-currencies is happening constantly. As with stocks, bonds, futures, etc. the average person is unable to take advantage. Effective arbitrage requires large sums of…

> Arbitrage across crypto-currencies is happening constantly. Then why doesn't it have the effect of equalizing prices across exchanges, as it does with traditional currencies across traditional currency exchanges? I'm not arguing, I'm just asking. If I don't know what I'm talking about, I'm happy to be enlightened.

Because the big players are much bigger in crypto arbitrage than the big players in traditional currency arbitrage, relatively. This combined with the unregulated nature makes abusing your position much easier in crypto.

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

#292

Post by marcus_holmes »

mikekchar wrote: post #244
viach wrote: post #180

Earlier quoted context omitted.

Why not using a web site built on postgres or mysql database to track balances then, instead of using blockchain and call the thing "cryptocurrency"?

Lots of companies do exactly this. For example, in Japan, where I live, the train and bus companies will give you a card. You can "put money" on the card and then spend it on travel. You can also use the cards to buy things in the convenience stores, some restaurants, vending machines, etc, etc. You can think of this as a "coin" that's pegged against prevailing currency (in my case, the yen). It's not a "cryptocoin"…

I predict nothing useful will emerge.

The blockchain is an interesting Computer Science toy. But in the 10+ years since it was invented, the only real application that anyone has found for it is Massively Distributed Ponzi Schemes.

The problems that you point out with London Transport aren't solvable by a distributed blockchain, because London Transport is a single central authority. It's completely pointless creating a distributed ticketing mechanism for them where they don't have all the power, because the ticketing mechanism is for the trains that London Transport run and control completely. There's no point having a ticket that London Transport don't recognise as valid. They're always going to be a single point of failure because they run the whole system. Sorry to be so blunt about it.

The solution to this problem is not to add in MORE complexity, networking and distribution. It'll be in removing complexity and improving connectivity.

But, of course, your stock price doesn't increase by removing complexity. You need the blockchains to impress the idiots who buy shares.

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

#293

Post by ozmbie »

michaelbuckbee wrote: post #240
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.

Genuinely curious: How do you know a private key is stolen with a cryptocurrency? Is there some sort of secondary proof mechanism?

You can create addresses which require multiple valid signatures (private keys) in order to spend the contents. And other sort of smart-contracts.

But it’s still based around having the correct mathematical keys to unlock an address.

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

#294

Post by bufferoverflow »

snowpanda wrote: post #266
bufferoverflow wrote: post #174

Earlier quoted context omitted.

Up to $250K in the US.

Per bank though right? Like if you have several different banks you could get multiple $250k?

It's per account, I think.

And yes, you could spread your money among multiple banks, but then you have manage multiple accounts.

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

#295

Post by makomk »

School-Cotton wrote: post #219
ceejayoz wrote: post #214

Earlier quoted context omitted.

Oh, they're certainly getting some. The suspicion is they're siphoning it off to their personal accounts, and that they're claiming to have received way more USD than they actually have so they can issue USDT that aren't actually backed to manipulate the market.

In that case, I'm confused by your question: "where's the USD to buy the Tether coming from?" You seem to have changed what you're suspicious about.

There's been a fair amount of conspiracy-theory-like thinking around Tether in general, with people making a morass of self-contradictory claims about it and shifting their positions every time someone points out one of the claims doesn't stand up.

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

#296

Post by michaelbuckbee »

infinity0 wrote: post #288
michaelbuckbee wrote: post #263

Earlier quoted context omitted.

Yes, but from the exchange's perspective: How do they know? I'm presuming that in this case (given the amount) that this was not a typical user. But is there some framework of dispute for lesser amounts?

It is not possible to move funds unless you have the private key, or if you have broken the cryptographic scheme the key uses. Since the funds have moved (visible on the overall distributed blockchain system, where everything is public), either of the two scenarios must have happened. It really is that simple, there are no other "moving parts" or "possible human error" in other parts of the system here.

So you have a case like this: the funds were moved with the private key. 24 hours after the owner comes and says: ‘I didn’t do that! Someone else must have copied my key and made that transaction!’

How does the exchange handle that? What’s the dispute mechanism?

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

#297

Post by [deleted] »

AznHisoka wrote: post #216
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.

So if they're tracking the coins to ensure they're not sold, and assuming it's never sold, wouldn't that mean the price of XEM should increase, as the supply has now decreased?

[deleted]

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

#298

Post by aptwebapps »

michaelbuckbee wrote: post #296
infinity0 wrote: post #288

Earlier quoted context omitted.

It is not possible to move funds unless you have the private key, or if you have broken the cryptographic scheme the key uses. Since the funds have moved (visible on the overall distributed blockchain system, where everything is public), either of the two scenarios must have happened. It really is that simple, there are no other "moving parts" or "possible human error" in other parts of the system here.

So you have a case like this: the funds were moved with the private key. 24 hours after the owner comes and says: ‘I didn’t do that! Someone else must have copied my key and made that transaction!’ How does the exchange handle that? What’s the dispute mechanism?

It's the exchange's own key that is thought to be compromised, not one of their customers'.

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

#299

Post by lojack »

ReverseCold wrote: post #230
CryptoPunk wrote: post #173

Earlier quoted context omitted.

NEM (the cryptocurrency that was stolen) isn't decentralized.

What do you mean? It is intended to be decentralized, I am curious as to why you think it isn't. (Possible misunderstanding/etc?)

Saying something isn’t decentralized in the crypto world can mean any of a number of things. The problem is that decentralization isn’t one specific thing that can be measured. There’s absolute centralization like a mainframe controlled by a single individual not connected to the outside world. Beyond that nothing else is absolute, there’s just varying degrees of decentralization.

You could have a slightly decentralized governance like a consortium that votes on how to manage the mainframe. You could have a distributed network of computers all managed by a single entity. Each of those have elements of centralization and decentralization. Within those categories there is varying levels of decentralization. For instance there could be a completely democratic organization that votes on how to manage the mainframe or more of a republic style where members vote on a person to manage the mainframe for them.

So, when someone says something isn’t decentralized in the crypto world they typically mean some element is centralized or is slightly less decentralized. For bitcoin you will see people say this in reference to large mining pools that have the power to control consensus to a certain extent. For NEM, they’re probably referring to the fact that the nodes that control the network are closed source. Since they are closed source that means one entity can control the direction of the network, and one can’t simply fork what they’re building.

I’m of the opinion that there will never be complete decentralization, and every project will have some degree is centralization. We’ll get better with time, but I think decentralization is an inherently intractable problem.

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

#300

Post by School-Cotton »

makomk wrote: post #295
School-Cotton wrote: post #219

Earlier quoted context omitted.

In that case, I'm confused by your question: "where's the USD to buy the Tether coming from?" You seem to have changed what you're suspicious about.

There's been a fair amount of conspiracy-theory-like thinking around Tether in general, with people making a morass of self-contradictory claims about it and shifting their positions every time someone points out one of the claims doesn't stand up.

To be fair, tether really is quite shady. I think the real truth is probably somewhere in between.
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