Topic: Bitstamp will easily recover from this hack - page 2. (Read 4124 times)

the problem is not the recovery

the problem is the security breach..

A lot of people are saying that this is the end of Bitstamp. That they've been goxed and that any bitcoins held on the site are now gone. This isn't true. Bitstamp WILL easily recover from this hack. It sucks that this happened, but this isn't really a huge disaster and it should by no means affect the survivability of the company.

On the 5th of January, Bitstamp lost 18,000 BTC from a 200,000 BTC reserve. That's about 9% of the total reserve.

Percentage-wise, this is very similar to the hack that Poloniex suffered in 2014. It lost 12% of its bitcoins due to a technical glitch which was exploited by a hacker. That exchange was able to recover its reserves in just mere months. It has enjoyed a spotless security record since then.

In August 2014, Bter also lost 50 million NXT worth about $1.6 million due to a hacker. After a while, they were eventually able to recover 42 million NXT making their net loss 8 million NXT and a couple hundred BTC which they sold to the hacker for bargain prices in exchange for the return of the bulk of the stolen NXT. Today, they're still operating perfectly fine.

Bitstamp has had $10 million injected into it from venture capitalist/hedge fund firm Pantera. So as a last resort, they could use this money to refund its customers. Bitstamp earns millions of dollars every year from trading fees. The majority of their coins are held in cold storage. Mike Hearn, a trusted Bitcoin dev audited their BTC reserves several months ago and confirmed that everything looked OK. The fact that only 9 percent of all funds were stolen means that the security benefits of separating hot and cold wallets is working. Services like MyBitcoin, inputs.io, and Mt. Gox that failed to properly separate the two have seen the majority of their funds disappear. From the look of this hacking incident, it is clear that Bitstamp is not making the same mistake.

TL:DR; Your deposits are safe. There is no need to worry.

Bitstamp will easily recover from this hack

I would rather expect a wallet run as the coins are the most vunerable when kept on an exchange, not fiat.

i want my btc instantly when i press the withdraw button or at least know its available when i want it back

you mean ripple the platform...?  nope, that will never happen.  bitstamp is just a gateway as far as the ripple network is concerned.  the price of XRP could go down tho, that i give you.

If bitcoin price goes down, they will easily recover the loss in a couple of months, however if the price keeps going up, then they would need to operate in fractional reserve mode for a very long time

They may be big but not big enough to recover from a 5.2 million loss (if it was a real hack )

customer trust will be non-existant after this so even if they worked for free
for the next few years (which they probably wont or cant )  the fees would be so low it would take forever to recover this loss

(if they cant protect their own coins/money  ,im not trusting them to protect mine etc  )

communication has been pretty bad apart from the odd tweet telling people not to worry when we need a bit more than that
they wont even comment on the exact total of coins in storage etc

far easier to claim bankrupt ,blame the hacker and retire with the loot (if they have it )

 or open again under a different name and start again fresh and free from debts and obligations

According to the Bitstamp financial statement, the 2013 profit was around of 800,000 USD. Even they hide all the figures, let's say 2 mil usd profit/year. It's too less to cover the loss.
5 MIL USD are a lot of money. 500K are a lot of money but 5 MIL is huge

Bistamp will drag down Ripple with them. Take the popcorn and look to the show that it will come soon.

That's quite impressive, but I'm guessing those total figures are mostly comprised by the sum of the customer coins held.  I'd be interested to know their actual revenue figures from the past 2 years after employee/server/maintenance costs.

The question is...do they really have the integrity to stick with this and be willing to work basically free of charge and at a personal cost loss for the next few months, if not years...just to pay back the stolen funds?  My gut tells me no...which is why this scenario almost always plays out the same way. Whether or not this was an inside job, from a logical perspective there are very few business owners that would be willing to take that kind of hit, especially knowing it's already a sinking ship.

It's like people with burried with outrageous personal debts with a meager job salary.  That's why filing for bankruptcy is such a common practice nowadays especially in the current financial climate.

You have a point, but Stamp's financial health looks okay as of the last published auditing cycle: http://companycheck.co.uk/company/08157033/BITSTAMP-LIMITED/company-summary

5 million dollars is a huge amount to cover out of pocket unless they were making insane amounts of yearly revenue off fees.

Percentage-wise, this is very similar to the hack that Poloniex suffered in 2014. It lost 12% of its bitcoins due to a technical glitch which was exploited by a hacker. That exchange was able to recover its reserves in just mere months. It has enjoyed a spotless security record since then.

That's the big question. It's very suspicious that Bitstamp is evading answering it.

It's also a concern that Bitstamp's replies, on Twitter and on their own site, are increasingly vague about when they will be back up.

If they try to bring trading back up while limiting withdrawals, assume they're crooks.

I hope what is more important is that after the incident at least they know where the loopholes are and have taken the measures to upgrade their security. Also, what I'm interested is how the coins get lost to the attacker? SQL injection, I'm not sure... but certainly it's not that easy to get hacked in the first place.