Bitcoin Exchange Files Bankruptcy in Wake of Cyber Attack
By Troy Kitch-Oracle on Feb 28, 2014
There are a lot of interesting nuggets to pull from the downfall of Mt. Gox, but the Christian Science Monitor sums it up under "What it All Means":
Mt. Gox serves as a reminder that you're not just buying Bitcoins; you're also involved in the company performing the exchange. There are no watchmen to answer to, and things can go downhill quickly if a breach happens. It's not an isolated incident, either: In 2012, the exchange site Bitcoinica was hacked for over $460,000 worth of Bitcoins, according to The Verge.
If you're not familiar with the story, Mt Gox (Picture Source: The building that houses the Mt. Gox offices in Tokyo. Photo: Ariel Zambelich/WIRED) was targeted by hackers who stole around $350 million in Bitcoins over a two year period and they have stopped exchanging bitcoins as of Tuesday.
Wired has a great write-up here on the exploit and alleged repercussions and predictions of the attack, some of which have already come true: bankruptcy. The hackers exploited a bug in Mt. Gox's website, but it's not clear exactly what they did at this point:
Now, according to the alleged leaked document, it looks like hackers had been exploiting that bug for two years, and even removing bitcoins from supposedly secure “cold” wallets that the company had stored offline. Typically, cold wallets are disconnected from the internet and cannot be emptied by online attackers. However, the “cold storage has been wiped out due to a leak in the hot wallet,” the document states.
Wired is referring to this leaked document. Analysis at the end of the document says "Expertise to find: Analysts, top class developers (crypto), IT security expert..." I'll say they need an IT security expert.
There's more to learn on this one.