A history of bitcoin hacks

First of all, here is a brief description of what you need to do to be able to steal bitcoins or any crypto coins:

1: COPYING THE KEYS

There is no such thing as a Bitcoin. The virtual currency is nothing more than a public ledger system, called the blockchain, that keeps track of an ever-expanding list of addresses, and how many units of bitcoin are at those addresses.

If you own Bitcoin, what you actually own is the private cryptographic key to unlock a specific address. The private key looks like a long string of numbers and letters. You may choose to store your key, or keys if you have multiple addresses, in a number of places including a paper printout, a metal coin, a hard drive, an online service, or a tattoo on your body.

2: GETTING AWAY WITH IT

While Bitcoin has some features that make it great for thieves, it also has some features that make it not so great. The fact that the blockchain is public means that anyone can see to which address the coins were transferred next. After the Sheep Marketplace heist, some users tracked the thief as he or she moved the stolen coins from address to address. A thief may leave traces that are undetectable now but could be uncovered in the future, inspiring a retroactive investigation. Another option is to launder the money the way the mob might: spend it at Satoshi Dice or another Bitcoin casino.

3: GET RICH

Now you’ve got clean bitcoins — hopefully a lot of them! — and you’ve got your eye on a villa in the south of Italy. Unfortunately, the landlord doesn’t accept Bitcoin. Like most merchants in the world, she wants a government-sanctioned currency, preferably the euro.

It’s time to get creative. There are several ways you can unload a lot of Bitcoin while maintaining your anonymity. Find a rich buyer who is willing to take the bitcoins without verifying your identity in exchange for a discount on the price, for example. However, the best way to protect yourself is to remain patient. Unload your bitcoins in a series of transactions over weeks, ideally months or even years, in order to avoid arousing suspicion from those watching the blockchain as well as real-life authorities that might wonder how you suddenly came into millions of dollars.

Now, enjoy life in Italy.

Lets have a quick review on the largest hack in history of bitcoin:

June 2011 - Allinvain
25,000 BTC were stolen

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June 2011 ( one week later) - Mt Gox
850,000 BTC stolen - largest hack

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March 2012 - Bitcoinica
43,000 BTC stolen

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September 2012 - BitFloor
24,000 BTC stolen

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October 2013 - Inputs.io
4,000 BTC stolen

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November 2013 - BIPS
1,295 BTC stolen

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November 2013 - Picostocks
6,000 BTC stolen

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February 2014 - Mt Gox, part two
750,000 BTC stolen

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That gives a total of ---1703295 BTC--- stolen!!!

It accounts for about 8% of total BTC that will be produced and 10% of all BTC in circulation. It is a bit terrifying cos we know that there will be more and more BTC stolen or lost.

The lesson from this story is to make sure you keep your Bitcoins or any cryptocoins in a safe place , very safe place, very ... very safe place.