Monday, June 20, 2011

In Bitcoin We Trust - The Currency of Choice of Hackers Hacked

"Let this be an example to take the security of your wallet.dat files very seriously. I never thought bitcoin would attract criminals so quickly but yet here it is." -allinvain
While Bitcoin received undue publicity and attacks by politicians like Senator Charles Schumer, it has emerged as perhaps the world's first digital currency for physical goods and services (unlike digital currencies like Linden Dollars where you could only purchase virtual goods). Established in 2009 by Satoshi Nakamoto (assumed to be his nom-de-hack) it has taken a life of its own. Although it is not fiat currency and has no central banker, it has emerged as the new target of hackers as there is a real "tradable" value to it. While LulzSec, a prominent hacking group, accepted donations in Bitcoins (roughly 7000 dollars worth), new hacking groups have gone after Bitcoins as there is real money there. A new trojan/malware titled Infostealer.Coinbit has been identified as specifically going after Bitcoins. A Bitcoin user with the handle "allinvain" (quoted above) has claimed that he has been defrauded of 25,000 Bitcoins which is the equivalent of almost 500 thousand USD depending on the exchange rate of the day. Maybe the politicians should let the hackers do the attacks to undermine the digital currency and let Ben Bernnanke sleep well at night.

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