Darn... it's almost like the system that was built to supercede centralized banking isn't supposed to be used like a central bank. We're going to keep seeing this until people realize that
Darn... it's almost like the system that was built to supercede centralized banking isn't supposed to be used like a central bank. We're going to keep seeing this until people realize that
OMG you're so right, I often kind of forget about the fact that it's supposed to be decentralized! The decentralized money people reinvented centralized money, peak big tech!
OMG you're so right, I often kind of forget about the fact that it's supposed to be decentralized! The decentralized money people reinvented centralized money, peak big tech!
If people are forgetting that Bitcoin is supposed to be decentralized then I think we're talking about it for the wrong reasons, but oh well - I still think having programmable p2p money is pretty...
If people are forgetting that Bitcoin is supposed to be decentralized then I think we're talking about it for the wrong reasons, but oh well - I still think having programmable p2p money is pretty cool.
The good news for cryptocurrency investors arrived just after 8 a.m. on Friday: Coinbase, the largest crypto marketplace in the United States, had reached a deal with U.S. regulators to dismiss a lawsuit that had hung over the industry for years.
But within hours, the crypto market descended into a new crisis. At 10:51 a.m., Bybit, another leading crypto exchange, said it had been hacked — with industry analysts estimating the loss at nearly $1.5 billion, the largest theft in crypto history.
The prices of Bitcoin, Ether and other major cryptocurrencies plunged. Even Coinbase’s share price had dropped 8 percent by the end of the day.
This split-screen contrast was a telling illustration of the state of crypto in 2025. Even as President Trump embraces the industry, it remains the wild West of the financial world, prone to scams, thefts and sudden market meltdowns.
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The news about Coinbase and Bybit came at the end of a roller-coaster few days in the crypto world. A proliferation of new memecoins — digital currencies based on an internet joke or a celebrity mascot, with no practical function — has prompted widespread complaints about scams.
Last week, a memecoin promoted by the president of Argentina, Javier Milei, suddenly plummeted in value, setting off a political crisis there and costing investors more than $250 million.
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Crypto has a long history of damaging hacks, but the theft from Bybit dwarfed the previous record, when thieves stole $611 million in cryptocurrencies from a platform called PolyNetwork in 2021.
Even outside the crypto world, there is little precedent for a theft so big. “It may even be the largest single theft of all time,” said Tom Robinson, a co-founder of Elliptic, a crypto analysis firm.
On social media, Bybit’s chief executive, Ben Zhou, assured customers that the company was still solvent. “Even if this hack loss is not recovered, all of clients assets are 1 to 1 backed,” he wrote. “We can cover the loss.”
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A crypto research group, Arkham Intelligence, said North Korean hackers were behind the Bybit breach. Attacks by North Korean groups have plagued the industry for years.
They do - they have “cold wallets” that are offline and “hot wallets” that are used by the exchange’s computers to make transactions. The theft somehow happened when moving currency out of a cold...
They do - they have “cold wallets” that are offline and “hot wallets” that are used by the exchange’s computers to make transactions. The theft somehow happened when moving currency out of a cold wallet.
When a customer trades using an exchange, their assets are represented as accounting entries in the exchange’s database, much like a bank. The cryptocurrency goes into the exchange’s wallets.
Everyone anyways claims they're solvent after a theft in an effort to prevent a run on the rest. As long as no one withdraws they could hide having no money for quite a while, so I'm curious if...
Everyone anyways claims they're solvent after a theft in an effort to prevent a run on the rest. As long as no one withdraws they could hide having no money for quite a while, so I'm curious if they're to be believed.
I'm also baffled by the "1 to 1 backed" bit. That normally means that for everything in their database they have equivalent in their wallets. So if their database said they were storing 100 bitcoins for their customers then they need to have 100 bitcoins in their wallets. But that's a really weird thing to say after a hack. If they were 1 to 1 backed in my example and 50 bitcoins were stolen it would be difficult to believe they still are fully backed. They would've needed to have been massively over-backed, which would be silly from a cost opportunity perspective because they could've been investing the extra. That's not even counting the fact that crypto companies can and do lie about ever being 1 to 1 backed at all, so they might have not even been in the first place.
I don't have a horse in this race, but I have doubts about the truth of that PR statement. I certainly would not put any financial stock in it being true.
I suppose that upon realising they had been hacked they could have shorted bitcoin (realizing that it would plymer upon breaking the news). So essentially borrow a bunch of bitcoin from someone...
I suppose that upon realising they had been hacked they could have shorted bitcoin (realizing that it would plymer upon breaking the news). So essentially borrow a bunch of bitcoin from someone else, sell them, release the news... wait for price to plumet then buy back the bitcoins they sold plus enough to cover the theft. "Everything is all good! We have your bitcoins right here... They have inexplicably depreciated a lot of their value, but you know that sometimes happen when you make investments..."
The news wasn’t released by ByBit. People on X noticed the ByBit wallet had funds move in a suspicious way to a wallet that began selling, started talking about it, and then ByBit verified what...
The news wasn’t released by ByBit. People on X noticed the ByBit wallet had funds move in a suspicious way to a wallet that began selling, started talking about it, and then ByBit verified what happened afterwards.
Sure. I don't think they did short bitcoin in order to cover their losses. I'm mainly lamenting the crypto industry as a whole and they could have done it and I wouldn't have been too surprised....
Sure. I don't think they did short bitcoin in order to cover their losses. I'm mainly lamenting the crypto industry as a whole and they could have done it and I wouldn't have been too surprised. Them releasing the news isn't really here nor there IMO.
Yes, there's no particular reason to believe them, but the exchange could have profitable investments that they could sell. That is, they could take the loss as a hit to their investments.
Yes, there's no particular reason to believe them, but the exchange could have profitable investments that they could sell. That is, they could take the loss as a hit to their investments.
Part of the reason I don't believe them is their specificity. The ability to cover losses through investments or even insurance is not the same as "1 to 1 backed", except maybe if said investments...
Part of the reason I don't believe them is their specificity. The ability to cover losses through investments or even insurance is not the same as "1 to 1 backed", except maybe if said investments or insurance are denominated in the specific asset in question. If one of those companies that holds the specified amount of gold in a vault got their vault robbed they have lost their "1 to 1 backed" status until they put more gold in a vault, regardless of how many dollars they may have access to. This is because the point of the "1 to 1 backed" claim is to state that they don't have exposure to price movements.
Yeah that was my first thought too, are they implying they were greater than 1:1 backed before the hack? Because that would be a huge selling point in crypto, strange if they never mentioned it....
Yeah that was my first thought too, are they implying they were greater than 1:1 backed before the hack? Because that would be a huge selling point in crypto, strange if they never mentioned it. Suspicious even.
Darn... it's almost like the system that was built to supercede centralized banking isn't supposed to be used like a central bank. We're going to keep seeing this until people realize that
OMG you're so right, I often kind of forget about the fact that it's supposed to be decentralized! The decentralized money people reinvented centralized money, peak big tech!
If people are forgetting that Bitcoin is supposed to be decentralized then I think we're talking about it for the wrong reasons, but oh well - I still think having programmable p2p money is pretty cool.
https://archive.is/X9ODh
From the article:
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Do the exchanges keep their own series of wallets? I'm not clear on how they hold people's coins.
They do - they have “cold wallets” that are offline and “hot wallets” that are used by the exchange’s computers to make transactions. The theft somehow happened when moving currency out of a cold wallet.
When a customer trades using an exchange, their assets are represented as accounting entries in the exchange’s database, much like a bank. The cryptocurrency goes into the exchange’s wallets.
Everyone anyways claims they're solvent after a theft in an effort to prevent a run on the rest. As long as no one withdraws they could hide having no money for quite a while, so I'm curious if they're to be believed.
I'm also baffled by the "1 to 1 backed" bit. That normally means that for everything in their database they have equivalent in their wallets. So if their database said they were storing 100 bitcoins for their customers then they need to have 100 bitcoins in their wallets. But that's a really weird thing to say after a hack. If they were 1 to 1 backed in my example and 50 bitcoins were stolen it would be difficult to believe they still are fully backed. They would've needed to have been massively over-backed, which would be silly from a cost opportunity perspective because they could've been investing the extra. That's not even counting the fact that crypto companies can and do lie about ever being 1 to 1 backed at all, so they might have not even been in the first place.
I don't have a horse in this race, but I have doubts about the truth of that PR statement. I certainly would not put any financial stock in it being true.
I suppose that upon realising they had been hacked they could have shorted bitcoin (realizing that it would plymer upon breaking the news). So essentially borrow a bunch of bitcoin from someone else, sell them, release the news... wait for price to plumet then buy back the bitcoins they sold plus enough to cover the theft. "Everything is all good! We have your bitcoins right here... They have inexplicably depreciated a lot of their value, but you know that sometimes happen when you make investments..."
The news wasn’t released by ByBit. People on X noticed the ByBit wallet had funds move in a suspicious way to a wallet that began selling, started talking about it, and then ByBit verified what happened afterwards.
Sure. I don't think they did short bitcoin in order to cover their losses. I'm mainly lamenting the crypto industry as a whole and they could have done it and I wouldn't have been too surprised. Them releasing the news isn't really here nor there IMO.
Yes, there's no particular reason to believe them, but the exchange could have profitable investments that they could sell. That is, they could take the loss as a hit to their investments.
Part of the reason I don't believe them is their specificity. The ability to cover losses through investments or even insurance is not the same as "1 to 1 backed", except maybe if said investments or insurance are denominated in the specific asset in question. If one of those companies that holds the specified amount of gold in a vault got their vault robbed they have lost their "1 to 1 backed" status until they put more gold in a vault, regardless of how many dollars they may have access to. This is because the point of the "1 to 1 backed" claim is to state that they don't have exposure to price movements.
Yeah that was my first thought too, are they implying they were greater than 1:1 backed before the hack? Because that would be a huge selling point in crypto, strange if they never mentioned it. Suspicious even.
If only someone had warned us this could happen
I know it's not a constructive response that adds to the conversation but 😂🤣😂🤣😂🤣😂🤣😂🤣
It's not every day that the NYT and I see eye-to-eye, but when we do, it's usually about crypto.