One of the rallying cries Bitcoin’s most fervent advocates use to promote the cryptocurrency is “become your own bank.” Indeed, this nascent technology allows you to complete the basic functions of modern banks: receive transactions, store capital, and send transactions (and also verify/process transactions if you want to become a miner).
While many libertarians see this as one of Bitcoin’s most tantalizing aspects, the “become your own bank” aspect of BTC has its drawbacks. The main drawback being holding your own capital means you can be hacked, often easily.
$45 Million in Bitcoin and BCH Swiped
According to a post published to the “BTC” subreddit by a user going by “Zhoujianfu,” they have just been hacked for a large sum of both Bitcoin and Bitcoin Cash (BCH). The Redditor wrote:
[This] is my address, goddamnit. [The transactions] only [have] 3 confirmations, if any miners/the community can help somehow, I’ve got the private keys. Help, help, help… big reward obviously.
The addresses attached to the post, confirmed to be owned by the Reddit user through the signing of a message with a Bitcoin private key, suggest that $30 million worth of BCH (around 100,000 coins) and $15 million worth of Bitcoin (1,550 coins) were stolen.
Indeed, NewsBTC’s brief analysis of the addresses showed that a transactor had sent the funds from the affected addresses to others, then began splitting up the coins, likely to mitigate detection by blockchain crime-stoppers.
BREAKING
1M $BCH sim hack!! worth $30M from 1 single Chinese whale (he claimed lost $15M $BTC too) He's now asking for help from miners ..I'm talking with top BCH pool owners on this OMFG
😱😱😱
BCH address :qzumak2rvxksjgkjuxe2fe5jxatktlsnhy5sthr5p7
THIS IS REALLY BRUTAL pic.twitter.com/19XM3w5BL7
— Dovey "Rug the fiat" Wan (hiring) (@DoveyWan) February 22, 2020
How Did This Go Down?
How did this happen? You might ask.
According to the “Chinese whale,” as cryptocurrency commentator and investor Dovey Wan branded them, it was a SIM swap. (Importantly, these claims cannot be verified, with many questioning why someone would store such a large sum of Bitcoin and BCH on a platform that can be accessed through one cellphone. There may be context missing that has yet to be revealed.)
For those unaware, a SIM swap is when a hacker takes over one’s cellular identity, meaning their cell phone number, often through social engineering tactics.
With many services requiring second-factor authentication in the form of codes sent as texts to phone numbers, SIM swaps may allow hackers to more easily access a victims’ online banking information, emails, online file drives, and even crypto exchange logins.
Bitcoin Unaffected by the Unfortunate Hack
The market has seemingly shrugged off this event, perhaps because it isn’t clear what the apparent hacker is going to do with the stolen BTC and BCH.
As of the time of writing this article, Bitcoin has registered a loss of a mere -0.29% in the past 24 hours, flatlining after the brutal crash from $10,300 to $9,250 that took place in minutes.
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