Do we even have a specific term for the opposite of "Defense in Depth"?
"Vulnerability in Depth"?
FTX stored private keys to crypto assets in plaintext, without access controls
51–60 of 222 posts
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#52As the tweet points out the bad practice and doesn't comment on the good practice how _should_ one store their keys? Specifically the tweet states that using a secret manager or password vault is a problem, so what is the solution?
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#53It is fantastic that a company operating with such horrific practices is dead. While we are at it, when can we fix similar issues below with mainstream financial systems that millions of people are still using?
- Social security numbers are used as a secret for identification, despite being in plaintext and having so low entropy as to be guessable, and originally issued on a card literally saying "Not for Identification".
- Every bank check lists the bank account number, which serves as the only information needed for a party to issue a request to withdraw money from that account.
- Credit card numbers are similarly a private number used as a public number, and printed on plaintext on the card.
Is there any effort working on bringing asymmetric encryption to these systems or to replace them that has a reasonable chance of working?
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#54Wait, what ? Private keys were stored in unprotected plaintext files regularly opened by multiple people at the company? WTF? That crosses the line and goes deep into "willful negligence" territory, in my view. The physical equivalent would be stacking customer assets like dollar bills and gold bars in big piles inside a heavily trafficked room that has no lock. The term "irresponsible" doesn't quite do justice to it…
I wonder if this reaction is so strong because the readership here are generally more knowledgeable on software and software security than banking. If there was a Hacker News for banking experts, they probably had this reaction to the "accounting" spreadsheet SBF released previously.
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#55How should the keys be stored? Not excusing them, but this isn't as straightforward to resolve as people think. That being said, not having any access controls is cringe. Really?
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#56Wait, what ? Private keys were stored in unprotected plaintext files regularly opened by multiple people at the company? WTF? That crosses the line and goes deep into "willful negligence" territory, in my view. The physical equivalent would be stacking customer assets like dollar bills and gold bars in big piles inside a heavily trafficked room that has no lock. The term "irresponsible" doesn't quite do justice to it…
Yet FTX wasn’t hacked. Their own irresponsible bets lost it all instead.
One way to look at FTX is as a horse race between multiple catastrophic failure modes. In this case the financial malfeasance "won". Maybe in another universe where interest rates stayed low for another year we'd see FTX go down to a hack instead.
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#57Earlier quoted context omitted.
> That crosses the line and goes deep into "willful negligence" territory, in my view. Er, that's the thing that pushed you over the line? Not all the fraud and crime?
Both are bad. Crime is bad, but this is an argument for making software engineering more like a medical doctor's guild. Some things simply should not be done. There is an expectation of competence for some things like finance and medicine.
Storing your keys in plain text is hardly software engineering. Plenty of people who don't know the first thing about coding do it all the time.
This is a failure of security and risk management. Making a guild or licensing requirements for software engineers may or may not be a good idea, but it wouldn't have addressed this problem.
But even if it would have in the abstract, FTX played fast and loose with so many other rules, I wouldn't expect them to abide by those either.
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#58Stupid & Evil are best friends - if you're looking for one, the other is often nearby. There's going to be a mix of incredibly stupid and incredibly crooked behavior all through this. It's not a surprise that this "genius" is a delusional, pathetic dolt who couldn't operate a frozen banana stand properly, much less a multi-million dollar company. It's also not a surprise that he truly thinks he's innocent on all charges, because he's that much of an idiot.
Crooks typically believe and disbelieve their own bullshit simultaneously, which is even more nonsensical, but that's just criminal thinking at work. None of this is particularly confusing to criminal prosecutors, just the same ol' same ol'. SBF is going to jail, and if he doesn't switch his plea soon he's really going to jail...
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#59Earlier quoted context omitted.
> That crosses the line and goes deep into "willful negligence" territory, in my view. A lot of people are making the assumption that gross incompetence reigned supreme with FTX, and that does seem like the likeliest explanation, but another potential explanation is deeply devious criminal activity. They could have preplanned this behavior. If they were ever caught doing anything really bad, they had "plausible denia…
While I agree with most of this, keeping a small number of things secure for yourself is far easier than doing it for thousands/millions of accounts in an automated way. That's true of almost everything in software. For instance, just because I know how to use a password manager doesn't mean it's easy to get my whole family using a password manager. They were clearly dysfunctional and there may be some of this at pla…
I think that is what is so hilarious about the situation. The US is forever creating situations where companies want to be first in and fastest scaling at any cost, offering free everything to begin.
If they were a bank they would realize their growth is beyond their competence and bring in boring big bank security experts with some of the huge profits on the even more massive holdings.. But there were no legal profits on holding all these assets because they promised to be something better than a bank, making its money from risking your assets, so that was just done illegally leaving no above the table accounts for legitimate operation costs. (A friend of SBF with an illegal loan will obviously keep your keys safe.)
How could an honest company that takes negligence seriously compete? It is like the opposite of regulations as barrier to entry. How do you sell things for less than the Mafia's laundering operation?
Re: FTX stored private keys to crypto assets in plaintext, without access controls
#60When reading crypto clownworld stories like this, it is easy and fun to observe that cryptocurrency is a satire of the real (or "fiat", if you prefer) financial system. Less fun, but far more important, is to note how incredibly (infinitely?) subtle this satire is: https://news.ycombinator.com/item?id=22352840
One thinks about crypto as a clownworld only until one had to work with or inside the real financial system. Techincally, it is in no way better than crypto. The only difference is that in real financial system there is a strong legal cover for all the technical and security fuckups. Like, stealing from bank by exploiting their 10-years old Windows XP ATM connected to the internet is 10-years-in-jail offence, while s…
Also, banking is dealing with massive legacy codebases.
You get to write your own new stuff in crypto, there aren't excuses for fucking up on best practices