Having had his private key compromised, Luke Dashjr lost 216.9 bitcoins, or about $3.6 million.
The year 2023 is off to a bad start for Luke Dashjr, one of the original developers of Bitcoin Core (Bitcoin’s open source blockchain software). On Twitter, the latter indicated that his private key (PGP, per Pretty good privacy) had been “compromised”, thus losing all of his bitcoins.
The public addresses of the latter make it possible to trace the transactions carried out on 31 January. According to data on the chain216.9 bitcoins were stolen, or about $3.6 million at the price of bitcoin at the time of the transfers.
As a reminder, a cryptocurrency holder has both a private key and one (or more) public keys, which are sequences of numbers and letters. The private key, which must remain strictly confidential, allows a user to make transactions (payments) in cryptocurrencies while a public key, which can be known by everyone, allows the counterpart to receive transactions (payments). A bit like a dinghy in France when you have a bank account.
Not understanding why such a situation could have occurred, Luke Dashjr asked the FBI and his community on Twitter for help. The media Cointelegraph has published comment from a user, wondering how one of the original developers of Bitcoin Core can be helped, who is therefore more than aware of security.
As a reminder, Bitcoin Core is open source software that was published by Satoshi Nakamoto in 2009, initially under the name Bitcoin Qt. This software is open and accessible to all, as is the very philosophy of bitcoin, which is decentralized. . The Bitcoin Core allows you to access the Bitcoin network and therefore to receive, send or simply verify transactions on the Bitcoin blockchain. And today very few developers can claim to be part of such an adventure, which today secures the Bitcoin network.
So how could this situation happen? Luke Dashjr has finally provided some details on how he protects his cryptocurrencies. In a tweet on Monday, we learn that his cold wallet is “also” compromised, suggesting he was also using a “hot” wallet.
Cold wallet versus hot wallet
We remind you that a so-called cold wallet (or “cold wallet”) stores the private keys associated with the cryptocurrencies of users outside the network (computer, telephone). It allows users to transact (trade on decentralized platforms, send cryptocurrencies, buy NFTs) when connected to a network.
Other ways to protect your cryptocurrencies are so-called “hot” wallets (or “hot wallets”) that are connected to the Internet or on centralized cryptocurrency platforms – such as Binance or Coinbase – which hold users’ private keys for security purposes. And then if the platform fails, it takes users’ private keys with it. We see it today with the FTX crash.
For his part, the boss of Binance, Changpeng Zao, took the opportunity to indicate that if the stolen bitcoins were to pass through his platform, they would be frozen.