Topic: Binance losing 7000 BTC and the consequences of a ROLL Back (Read 495 times)

Since you're so sure about your case, mind to list the non-spendable address(es)?

I'm not saying this isn't what might have happened, but we all know that suspicions and thoughts aren't valid as evidence. Binance isn't perfect, but I'm sure they wouldn't refer to the +7000BTC withdrawal as theft if it was just an internal mistake that lead to the funds become unusable. They could just say it was a withdrawal request from a wide range of traders that has been processed manually.

Losing +7000BTC is the worst form of marketing there is, but they still were seemingly honest and open about it.

They did not loose them, they scr*w up by sending it to a non spendable adress

I agree it is not immutable. Every time there is a code change and mandatory update the chain is changed by consensus. But the people who make the decisions is still quite a small group. Most users have no clue about coding so put their trust in the hands of those that make the decision.

Bitcoin has also been rolled back before.

On 15 August 2010 a Bitcoin vulnerability created 184 million bitcoins. It resulted in a patch.

Strange block 74638
The most iconic bitcointalk threads. History on Bitcointalk.

But the ideal is immutability. I believe bitcoin is heading in that direction. The rejection of doing a roll back shows maturity.

There is an intresting analysis made by Coinfirm, they follow hacker addresses. Take a look at what kind of tools they use to recognize hacker: https://twitter.com/Coinfirm_io/status/1126082101080743938

so heres questions obviously a serious conversation has taken place on rolling back. Now if they did what happens to transactions that have happened thereafter.

Imagine if they all reverted back as well.

This whole roll back conversation is creating a reputation that bitcoin is no different to money and can be manipulated to help ones needs.

If roll back was possible im sure the governments would have killed BTC overnight with a roll back for some kind of adverse trade on BTC.

It didn't came for his own mouth, it was proposed to him and others chime in and CZ ask for advises as well. But obviously, he don't know what is this proposal and then when he weigh things down, it doesn't make sense to do it. So let the hackers get that 7000 BTC and have those forensics blockchain expert to track it down. And there are also exchanges who are monitoring the address and will block it the moment they see it entered within their environment.

Same with any selfish mining or double spend attack. They benefit miners and any entities they collude with, no one else. They certainly don't benefit users directly. Miners and services have colluded in such attacks in the past, too. People try to make it out like, "This time is different!" but they fail to realize what truly free markets really entail. 7,000 BTC wasn't enough to garner a serious discussion, but a much larger loss might see stakeholders talking differently, in spite of what the little guys on Twitter might have to say about it.

In some situations, we would have actual user incentives in favor of a reorg as well. If the loss were much greater, the market might perceive it as a huge blow to the ecosystem, like Mt Gox in 2014. An exchange of Binance's size socializing losses across users would also leave a sizeable number of Bitcoin users -- especially when emphasizing active circulating supply -- scathed. In a market so driven by value speculation, everyone has a vested financial interest in a positive outcome. The most principled of bitcoiners will consider a positive outcome to be one where the market crashes and investors lose, but in this kind of situation, I think you'd be surprised how many would opt for the opposite.

Everyone has their own opinion about what would happen. I'm personally not sure. I simply think the people who are so confident that it would be the end of Bitcoin might be wrong. I'm sure the market will confirm this either way eventually. Until then, we can keep debating it.

There are short term incentives and then there's the overall incentive for it to remain viable long term.

I have no doubt many miners know little to nothing about what they're actually dealing with, or care. All they're doing is turning electricity into fiat. If such an opportunity did come up I'm sure more than a few would consider it.

There would be other miners and almost every node operator and developer and user doing everything possible to defeat them.

A reorg like this only benefits Binance and whoever they recruit. Why would anyone who is not Binance or being paid by Binance do anything other than go all out to stop them? If one company succeeded a million would attempt the same thing.

Perhaps some people would, but I suspect they also might just be a small minority like the BIP148 contingent -- a small uncompromising group who is willing to fork themselves off the network and into obscurity.


The biggest mistake that people make is assuming that Bitcoin is immutable. It's not, and never was. This is a crucial mistake people make in their assumptions about pertinent game theory.

Bitcoin's design puts transaction reliability in the hands of miner incentives. I think Rubin made an interesting point about miners negotiating with one another about whether to build on the most recent block or to mine selfishly. We like to think that Bitcoin's incentives are perfect but there are surely situations where miners could maliciously profit (and have maliciously profited) from reorganizing the blockchain. When we think about smaller reorgs under this incentive set, we just consider it orphaning. 

So, there is an element of cognitive dissonance here and sadly, that's what this boils down to. Do you support free markets -- where miners can reorg the blockchain based on free market incentives -- or do you think these "hardliners" can and should pressure miners into ignoring short term market incentives in favor of their desired outcome?

This is the age-old question about long term vs. short term miner incentives. It really can't be answered with any level of certainty. I will say that I'm skeptical of people who think they can predict how the entire economy of Bitcoin users would react to any given situation. I'm agnostic on this question myself.

Do I want to see coordinate blockchain reorganizations? No, but if it happens, it happened because of Bitcoin's economic design -- full stop. My suspicion is that the market would understand this far better than ultra conservatives who would assume "Bitcoin is dead" because of a reorg. Those people are more like Bitcoin Cash supporters who sold all their coins because of Segwit activation because they fundamentally misunderstood Bitcoin's economic incentives. They'll be forked off and the rest of the network will move on without them.

It's all still waiting to be figured out, but BTC has the job of upholding crypto's principles in a way others don't.

It's like royal brothers. The one waiting to be king has to be a stiff. All the other ones are free to go and fuck winos in the eye socket. No one cares what they do.

If Bitcoin ever did this many would leave crypto all together and never bother returning. If it can be coaxed into doing it that means everything else can and will if it suits people who are rich, powerful or persuasive enough. It would be back to square one with a whole lot of money, effort and energy wasted along the way.

Immutability and decentralisation will ALWAYS be attacked as hard as possible by tossers who want short cuts. The people resisting know perfectly well that that's its only real value proposition.

that's the typical hardliner/maximalist stance but it's not well-evidenced. we have no idea how it would turn out. like it or not, the game theory around proof of work is not fully understood or set in stone. a lot of maximalists wouldn't want a post-coordinated-reorg bitcoin to survive, but i also think a lot of them are horrible at reading markets and would be 100% wrong about bitcoin's viability after such an event.

Luckily they are not pursuing it already


It would be a disaster to bitcoin if someone can convince miners to rollback just like that. Everything that bitcoin stand for will be lost at one fell swoop.

An impartial and unemotional take here about how a reorg might be put together - https://twitter.com/AriDavidPaul/status/1126071394545090560

The person initiating it would have to make sure miners got more profit out of it than the status quo. Even the stupidest miner would hopefully realise they're devaluing everything, possibly permanently or even fatally.

I find it amazing that after all that's been learnt people at least half familiar with the whole thing could conceive of it being an idea worth exploring. At the same time it's a reminder that immutability is not automatic and has to be protected and maintained.

My point exactly why talk about this and make it sound so simple. It damages the whole reputation of the BTC chain

The CEO doesn't even know what he is talking about and then had to take back his words. Like some people have a doubt that Binance has lost even more funds that they don't want to disclose and he is very well aware that even other exchanges have been hacked but never such a thing like a rollback has been ever talked about. It's foolish of him to even make such a statement.

that is not the only result, it is not even the most important one either. losing market cap, price ,... don't matter at all.
the only important thing that happened to ethereum when they rolled back was that it lost its immutability and is no longer a trusted blockchain because the first thing about a blockchain is that it can not and should not change. if the "owners" decide they want to roll back they can do that any time they want specially when they switch to PoS and increase their power.

Binance is part of top exchanges and I also believe that they can surely afford the top notch security the same with other top notch exchanges.

I am a little bit puzzled whether this accident is 100% genuine or there are other reasons behind it like inside job or something similar to it that all of the team members will received a share. We already know that bitcoin is unrecoverable, I am not sure if they will succeed with their plan as I saw that almost half of the said price that were stolen has been withdrawn already.

It seems like the most retarded solution EVER.
Binance is a separate cryptocurrency related service. They are taking people's money and in exchange providing them the currency exchange service. And they are taking other people's money at their own fucking risk.
So what we get in the end is that Binance lost big amount of money and instead of paying compensations they  are asking the entire community to centralize the entire blockchain.
How about repaying those $40 mln from their own pockets? I bet Binance would be able to find such money.

saying this there are a number of pictures of comments made in the last attempted hack that conveniently said 7000 BTC disappeared.

not sure if anyone has seen them

And who says they were hacked and not scammed? I would put my 5 cents on inside job, then blame on external factors, and cover it with your shit coin BNB and have another shicoin back it up TRX

Ethereum rolled back the transactions. The result ? Two coins, a split community and multiples of the actual loss wiped off the market cap instantly.

It is scary that a large player like Binance considered it. They rejected the idea and I commend them for it. But it wouldn't stop a symilar large entity from doing something symilar.

That is why decentralization has to be taken seriously.

Bitmain has too much control over mining and mining hardware.

Binance and other exchange have too much control over user funds they don't own.

The vulnerabilities are mining control, hardware control, volume control (trading and control over funds) and centralized control over code.

I'm not anti Binance (I think they have built a great exchange) - but I'm anti centralization and anti oligopoly control.

I just read an article that he decided not to rollback bitcoin blockchain because of many factors like it may have some negative consequences, in terms of destroying the credibility for bitcoin

If this situation is such a strong exchange, such as Binance , then very bad news. I had some investment. I think thousands of investors like me used to trade here, their condition might be very bad now or maybe. One solution is important.

With this idea from the CEO of this exchange, you should now think 3 times if you ever like to use this again.
He indicates that he has no clue on the bitcoin network. Do you really want him to handle your money?

And always true for all other exchanges: Not your keys not your money.

wouldn't be so good for BTC if a single exchange could have the power to roll the chain back. Binance system wasn't safu so they have to pay for it. the made enough money, they have a fund for this kind of shit.

The 51% "roll back" idea is quite interesting but what's the cost of implementing it.Binance is a big crypto exchange platform,but they don't have enough money to fund 51% hash power.What if they have to spend more than 40M USD in order to get back the stolen 40M USD?

My point isn't the hack. My point is the conversation taken place thereafter, about rewinding the clock and returning the funds using the 51% hash power, when I posted this I didn't see anyone else write about that simply about the hack.

Well, traders funds in Binance is SAFU, but the problem is, it still has an effect in the market. It might be another inside job intended to create FUD in the market since the market is preparing to rise-up. Just stay safe, and never leave your funds in any exchange.

Still can not believe how an exchange like Binance exchange is hacked. if one of these large exchanges becomes hack, then all other small exchanges can be hacked at any time. We can not see our found safe anywhere. Which will have a lot of impact on the crypto market. It is really very surprising, I do not know how to become a security system kind of this excahnge, where there is so much trade every second, there must have been a lot of high security. However, now we return the dollars that have been hacked, otherwise we all will face many losses.

I was very disappointed to hear such news. to me Personally, It's hard to believe that they were hacked. They are well-known exchange and their Names is speak for themselves. funds are SAFU so probably if you hold anything in there you should not worry about it.

We can anticipate some dips because of this fud and we can somehow think that this might just another show up so whales can buy more, isn't it?

While as the binance had stated that all funds were safe and I think there's some sort of insurance that cover any losses ( if any ) so I don't see any reason to panic and spreading fuds are useless.

This is bad news, but I hope all parties can continue to believe in cryptocurrencies. Because with trust the market can be maintained and there should be no situation of loss of trust. Because usually things like this will have a negative impact on the price changes of cryptocurrencies. 7000 BTC is a large amount, hopefully there will be no price dumping.

If not for trading web wallet is never my choice, so many people have 100% trust on binance security before the hack incident yesterday which should further clear my curiosity. Am OK with hardware wallet which always leave the security of my coins in my hand because online wallet can be easily hacked into, this is really a bad one for binance but also this will give room for improvement as the CEO CZ have said the hackers really displayed they weakness which will be improve on.

only things that rarely happen can be considered surprising. but something that happens regularly should not surprise you. it is like being surprised when the sun goes down in the afternoon!
in crypto-space, exchanges getting hacked is the most common occurrence. every year we have about 6 or 7 major exchange scams (not counting the small unknown exchanges). that is 1 every 2 months on average. you can't really be surprised about that!

It's disappointing to know and even a top exchange could be hacked. 7000 Btc is such a huge amount and knowing that our funds could be hacked makes us feel doubtful about the exchanges these days. The hard wallet would still be a convenient and most choice during this situation.

It was so shocking and I couldn't believe my eyes when a big exchange site like Binance was attacked by hackers and took away so much money. It is too dangerous and confusing to investors on Binance. The bear market seems to have just finished but perhaps the crypto market will have a huge impact.

haha, Binance dudes have been swimming around in so much shitcoins that have started thinking bitcoin might be like one of those where every time they mess up they can ask for an undo button.
life doesn't have an undo button, neither does bitcoin. besides, unlike shitcoins like ethereum that did roll back, immutability means something here in bitcoin.

Don't we have enough threads talking about this topic already?

https://bitcointalksearch.org/topic/binance-lost-407-million-to-hackers-which-exchange-is-next-5140532

https://bitcointalksearch.org/topic/binance-has-been-hacked-5140544

More and more threads = Pointless FUD which is why I urge you to lock this thread and continue your discussion in one of the threads that I linked op.

Yesterday Binance was hacked fgor $40 Million worth of BTC equivalent to 7000 BTC at todays price.
Well we have heard of hacks before what we have never heard of is the mention of rolls backs.
What do you mean Roll Back.
Binance techs have suggested taking 51% control of the miner power and rolling back this transaction.
Does any one else have a problem with this?