Get smarter, faster. Subscribe to our daily newsletter.
Bitcoin burglaries: The 5 biggest cryptocurrency heists in history
At the beginning of July 2018, blockchain security firm CipherTrace reported that $731 million has been stolen from crypto exchanges this year alone.
As the popularity of cryptocurrencies continues to soar, so does the number of hackers targeting exchanges. In 2017, crypto exchanges reported losing approximately $266 million as a result of security breaches and heists. However, the first half of 2018 alone has reported that triple this amount has been stolen from crypto exchanges already.
“With each passing crypto hack, there’s more at stake. These heists aren’t just becoming more common. They’re becoming significantly more valuable.”
In this article, we’ll take a look at some of the most prolific crypto heists in history.
The Coincheck heist
In January 2018, hackers found a loophole in the Coincheck exchange that allowed them to steal over 500 million NEM. This was worth around $530 million at the time. While only the NEM was breached and other funds remained secure, NEM Foundation has stressed that the hack was nothing to do with the security of the XEM cryptocurrency.
They have insisted that the blame is entirely on Coincheck, saying that it was a result of its ‘relaxed security measures’. Because such a significant percentage of XEM was compromised, many people immediately assumed that NEM would carry out a hard fork in order to recover the funds. However, this did not occur. Coincheck now has the reputation of being the victim of the biggest crypto exchange hack in history.
The Mt. Gox hack
Up until the recent Coincheck hack, the Mt. Gox Hack was the biggest crypto heist in history. It still remains the biggest Bitcoin heist to have ever occurred.
Mt. Gox was a crypto exchange based in Tokyo, Japan. Between 2013 and 2014, it handled over 70% of all worldwide Bitcoin transactions. Unfortunately, by February 2014, the exchange had declared bankruptcy.
The hacker stole approximately 850,000 Bitcoins - worth around $450 million at the time. What’s more, this was approximately 6% of all Bitcoin in existence at the time. Therefore, at the time of the theft, this was a significant percentage of the total crypto market cap. In that sense, this was even bigger than the Coincheck hack. 200,000 of the stolen Bitcoins were eventually recovered. However, approximately 650,000 remain lost forever.
Founder of Ethereum Vitalik Buterin during TechCrunch Disrupt London 2015. Photo by John Phillips/Getty Images for TechCrunch.
The DAO attack that led to the creation of Ethereum Classic (ETC)
A ‘DAO’ is a Decentralized Autonomous Organization that aims to eliminate the requirement for third-parties in governing and to ultimately create a structure that has decentralized control. It does this by turning the rules and decision-making apparatus of an organization into code.
‘The DAO’ was the name of a particular DAO. It was launched on the 30th April 2016 and had a 28-day funding window. It was extremely popular - so much so that by the end of its funding period, it was the largest crowdfunded organization in history.
Throughout the crowdsale, several people expressed concerns about The DAO’s security and suggested that it could be vulnerable to attack. Despite this, it went on to raise over $150 million from 11,000 members - far more than its creators had ever imagined.
On June 12th, 2016, Stephen Tual, one of the creators of The DAO, announced that a "recursive call" bug had been found in the code. However, at the end of his post, stressed that "this is NOT an issue that is putting any DAO funds at risk today." Unfortunately, Tual turned out to be very wrong. By the time the team had identified the bug and begun to fix it, a hacker was already exploiting it and draining The DAO of the ether it had collected from its token sales.
By the 18th of June, less than a week after the announcement had been made, the hacker had already managed to drain over 3.6 million ether (worth approximately $70 million) into a “child DAO”. This alone led the price of Ether to fall drastically from $20 to $13.
As a result of this catastrophe, an Ethereum hard-fork was proposed, with 89% of Ether holders voting in favor of it. This led to the creation of Ethereum Classic (ETC) - a new cryptocurrency which shares the data on the Ethereum blockchain up until block 1920000.
The Bitfinex exchange heist
Bitfinex is currently ranked as the second largest crypto exchange in terms of daily trading volumes. However, in August 2016, the exchange suffered a hacking heist that resulted in the loss of over 120,000 Bitcoins, worth around $66 million. Within hours of the attack, the value of Bitcoin had dropped from over $600 to $540. Moreover, the users never received compensation for their lost Bitcoins. Instead, the exchange paid users in BFX tokens for their losses and promised to buy these tokens back at a later date.
The platform experienced another cyber attack in June 2018. However, this attack only affected trading operations. Thankfully, no user accounts were compromised.
The BitFloor exchange heist
Despite being relatively unknown, the BitFloor heist remains one of the biggest Bitcoin heists in history. It resulted in the loss of over 24,000 Bitcoins. At the time it was considered relatively small. However, in today’s terms, the hack would be worth a surplus of $141 million.
Back in 2012, BitFloor was one of the largest competitors of Mt. Gox. However, it had to shut down abruptly when hackers gained access to the private keys of users. This was made possible because the hackers were able to gain access to the users’ private keys, which were stored in an extremely insecure manner in an unencrypted state, online, for backups.
Luckily, the exchange was able to refund users for their losses. However, it was ultimately forced to shut down.
Scientists are using bioelectronic medicine to treat inflammatory diseases, an approach that capitalizes on the ancient "hardwiring" of the nervous system.
- Bioelectronic medicine is an emerging field that focuses on manipulating the nervous system to treat diseases.
- Clinical studies show that using electronic devices to stimulate the vagus nerve is effective at treating inflammatory diseases like rheumatoid arthritis.
- Although it's not yet approved by the US Food and Drug Administration, vagus nerve stimulation may also prove effective at treating other diseases like cancer, diabetes and depression.
The nervous system’s ancient reflexes<p>You accidentally place your hand on a hot stove. Almost instantaneously, your hand withdraws.</p><p>What triggered your hand to move? The answer is <em>not</em> that you consciously decided the stove was hot and you should move your hand. Rather, it was a reflex: Skin receptors on your hand sent nerve impulses to the spinal cord, which ultimately sent back motor neurons that caused your hand to move away. This all occurred before your "conscious brain" realized what happened.</p><p>Similarly, the nervous system has reflexes that protect individual cells in the body.</p><p>"The nervous system evolved because we need to respond to stimuli in the environment," said Dr. Tracey. "Neural signals don't come from the brain down first. Instead, when something happens in the environment, our peripheral nervous system senses it and sends a signal to the central nervous system, which comprises the brain and spinal cord. And then the nervous system responds to correct the problem."</p><p>So, what if scientists could "hack" into the nervous system, manipulating the electrical activity in the nervous system to control molecular processes and produce desirable outcomes? That's the chief goal of bioelectronic medicine.</p><p>"There are billions of neurons in the body that interact with almost every cell in the body, and at each of those nerve endings, molecular signals control molecular mechanisms that can be defined and mapped, and potentially put under control," Dr. Tracey said in a <a href="https://www.youtube.com/watch?v=AJH9KsMKi5M" target="_blank">TED Talk</a>.</p><p>"Many of these mechanisms are also involved in important diseases, like cancer, Alzheimer's, diabetes, hypertension and shock. It's very plausible that finding neural signals to control those mechanisms will hold promises for devices replacing some of today's medication for those diseases."</p><p>How can scientists hack the nervous system? For years, researchers in the field of bioelectronic medicine have zeroed in on the longest cranial nerve in the body: the vagus nerve.</p>
The vagus nerve<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNTYyOTM5OC9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY0NTIwNzk0NX0.UCy-3UNpomb3DQZMhyOw_SQG4ThwACXW_rMnc9mLAe8/img.jpg?width=1245&coordinates=0%2C0%2C0%2C0&height=700" id="09add" class="rm-shortcode" data-rm-shortcode-id="f38dbfbbfe470ad85a3b023dd5083557" data-rm-shortcode-name="rebelmouse-image" data-width="1245" data-height="700" />
Electrical signals, seen here in a synapse, travel along the vagus nerve to trigger an inflammatory response.
Credit: Adobe Stock via solvod<p>The vagus nerve ("vagus" meaning "wandering" in Latin) comprises two nerve branches that stretch from the brainstem down to the chest and abdomen, where nerve fibers connect to organs. Electrical signals constantly travel up and down the vagus nerve, facilitating communication between the brain and other parts of the body.</p><p>One aspect of this back-and-forth communication is inflammation. When the immune system detects injury or attack, it automatically triggers an inflammatory response, which helps heal injuries and fend off invaders. But when not deployed properly, inflammation can become excessive, exacerbating the original problem and potentially contributing to diseases.</p><p>In 2002, Dr. Tracey and his colleagues discovered that the nervous system plays a key role in monitoring and modifying inflammation. This occurs through a process called the <a href="https://www.nature.com/articles/nature01321" target="_blank" rel="noopener noreferrer">inflammatory reflex</a>. In simple terms, it works like this: When the nervous system detects inflammatory stimuli, it reflexively (and subconsciously) deploys electrical signals through the vagus nerve that trigger anti-inflammatory molecular processes.</p><p>In rodent experiments, Dr. Tracey and his colleagues observed that electrical signals traveling through the vagus nerve control TNF, a protein that, in excess, causes inflammation. These electrical signals travel through the vagus nerve to the spleen. There, electrical signals are converted to chemical signals, triggering a molecular process that ultimately makes TNF, which exacerbates conditions like rheumatoid arthritis.</p><p>The incredible chain reaction of the inflammatory reflex was observed by Dr. Tracey and his colleagues in greater detail through rodent experiments. When inflammatory stimuli are detected, the nervous system sends electrical signals that travel through the vagus nerve to the spleen. There, the electrical signals are converted to chemical signals, which trigger the spleen to create a white blood cell called a T cell, which then creates a neurotransmitter called acetylcholine. The acetylcholine interacts with macrophages, which are a specific type of white blood cell that creates TNF, a protein that, in excess, causes inflammation. At that point, the acetylcholine triggers the macrophages to stop overproducing TNF – or inflammation.</p><p>Experiments showed that when a specific part of the body is inflamed, specific fibers within the vagus nerve start firing. Dr. Tracey and his colleagues were able to map these relationships. More importantly, they were able to stimulate specific parts of the vagus nerve to "shut off" inflammation.</p><p>What's more, clinical trials show that vagus nerve stimulation not only "shuts off" inflammation, but also triggers the production of cells that promote healing.</p><p>"In animal experiments, we understand how this works," Dr. Tracey said. "And now we have clinical trials showing that the human response is what's predicted by the lab experiments. Many scientific thresholds have been crossed in the clinic and the lab. We're literally at the point of regulatory steps and stages, and then marketing and distribution before this idea takes off."<br></p>
The future of bioelectronic medicine<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNTYxMDYxMy9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYzNjQwOTExNH0.uBY1TnEs_kv9Dal7zmA_i9L7T0wnIuf9gGtdRXcNNxo/img.jpg?width=980" id="8b5b2" class="rm-shortcode" data-rm-shortcode-id="c005e615e5f23c2817483862354d2cc4" data-rm-shortcode-name="rebelmouse-image" data-width="2000" data-height="1125" />
Vagus nerve stimulation can already treat Crohn's disease and other inflammatory diseases. In the future, it may also be used to treat cancer, diabetes, and depression.
Credit: Adobe Stock via Maridav<p>Vagus nerve stimulation is currently awaiting approval by the US Food and Drug Administration, but so far, it's proven safe and effective in clinical trials on humans. Dr. Tracey said vagus nerve stimulation could become a common treatment for a wide range of diseases, including cancer, Alzheimer's, diabetes, hypertension, shock, depression and diabetes.</p><p>"To the extent that inflammation is the problem in the disease, then stopping inflammation or suppressing the inflammation with vagus nerve stimulation or bioelectronic approaches will be beneficial and therapeutic," he said.</p><p>Receiving vagus nerve stimulation would require having an electronic device, about the size of lima bean, surgically implanted in your neck during a 30-minute procedure. A couple of weeks later, you'd visit, say, your rheumatologist, who would activate the device and determine the right dosage. The stimulation would take a few minutes each day, and it'd likely be unnoticeable.</p><p>But the most revolutionary aspect of bioelectronic medicine, according to Dr. Tracey, is that approaches like vagus nerve stimulation wouldn't come with harmful and potentially deadly side effects, as many pharmaceutical drugs currently do.</p><p>"A device on a nerve is not going to have systemic side effects on the body like taking a steroid does," Dr. Tracey said. "It's a powerful concept that, frankly, scientists are quite accepting of—it's actually quite amazing. But the idea of adopting this into practice is going to take another 10 or 20 years, because it's hard for physicians, who've spent their lives writing prescriptions for pills or injections, that a computer chip can replace the drug."</p><p>But patients could also play a role in advancing bioelectronic medicine.</p><p>"There's a huge demand in this patient cohort for something better than they're taking now," Dr. Tracey said. "Patients don't want to take a drug with a black-box warning, costs $100,000 a year and works half the time."</p><p>Michael Dowling, president and CEO of Northwell Health, elaborated:</p><p>"Why would patients pursue a drug regimen when they could opt for a few electronic pulses? Is it possible that treatments like this, pulses through electronic devices, could replace some drugs in the coming years as preferred treatments? Tracey believes it is, and that is perhaps why the pharmaceutical industry closely follows his work."</p><p>Over the long term, bioelectronic approaches are unlikely to completely replace pharmaceutical drugs, but they could replace many, or at least be used as supplemental treatments.</p><p>Dr. Tracey is optimistic about the future of the field.</p><p>"It's going to spawn a huge new industry that will rival the pharmaceutical industry in the next 50 years," he said. "This is no longer just a startup industry. [...] It's going to be very interesting to see the explosive growth that's going to occur."</p>
Japan looks to replace China as the primary source of critical metals
- Enough rare earth minerals have been found off Japan to last centuries
- Rare earths are important materials for green technology, as well as medicine and manufacturing
- Where would we be without all of our rare-earth magnets?
What are the rare earth elements?<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8xOTA2MTM0Ni9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYzODExMjMyMn0.owchAgxSBwji5IofgwKtueKSbHNyjPfT7hTJrHpTi98/img.jpg?width=980" id="fd315" class="rm-shortcode" data-rm-shortcode-id="d8ed70e3d0b67b9cbe78414ffd02c43e" data-rm-shortcode-name="rebelmouse-image" />
(julie deshaies/Shutterstock)<p>The rare earth metals can be mostly found in the second row from the bottom in the Table of Elements. According to the <a href="http://www.rareearthtechalliance.com/What-are-Rare-Earths" target="_blank"><u>Rare Earth Technology Alliance</u></a>, due to the "unique magnetic, luminescent, and electrochemical properties, these elements help make many technologies perform with reduced weight, reduced emissions, and energy consumption; or give them greater efficiency, performance, miniaturization, speed, durability, and thermal stability."</p><p>In order of atomic number, the rare earths are:</p> <ul> <li>Scandium or Sc (21) — This is used in TVs and energy-saving lamps.</li> <li>Yttrium or Y (39) — Yttrium is important in the medical world, used in cancer drugs, rheumatoid arthritis medications, and surgical supplies. It's also used in superconductors and lasers.</li> <li>Lanthanum or La (57) — Lanthanum finds use in camera/telescope lenses, special optical glasses, and infrared absorbing glass.</li> <li>Cerium or Ce (58) — Cerium is found in catalytic converters, and is used for precision glass-polishing. It's also found in alloys, magnets, electrodes, and carbon-arc lighting. </li> <li>Praseodymium or Pr (59) — This is used in magnets and high-strength metals.</li> <li>Neodymium or Nd (60) — Many of the magnets around you have neodymium in them: speakers and headphones, microphones, computer storage, and magnets in your car. It's also found in high-powered industrial and military lasers. The mineral is especially important for green tech. Each <a href="https://www.reuters.com/article/us-mining-toyota/as-hybrid-cars-gobble-rare-metals-shortage-looms-idUSTRE57U02B20090831" target="_blank"><u>Prius</u></a> motor, for example, requires 2.2 lbs of neodymium, and its battery another 22-33 lbs. <a href="https://pubs.usgs.gov/sir/2011/5036/sir2011-5036.pdf" target="_blank"><u>Wind turbine batteries</u></a> require 450 lbs of neodymium per watt. </li> <li>Promethium or Pm (61) — This is used in pacemakers, watches, and research.</li> <li>Samarium or Sm (62) — This mineral is used in magnets in addition to intravenous cancer radiation treatments and nuclear reactor control rods.</li> <li>Europium or Eu (63) — Europium is used in color displays and compact fluorescent light bulbs.</li> <li>Gadolinium or Gd (64) — It's important for nuclear reactor shielding, cancer radiation treatments, as well as x-ray and bone-density diagnostic equipment.</li> <li>Terbium or Tb (65) — Terbium has similar uses to Europium, though it's also soft and thus possesses unique shaping capabilities .</li> <li>Dysprosium or Dy (66) — This is added to other rare-earth magnets to help them work at high temperatures. It's used for computer storage, in nuclear reactors, and in energy-efficient vehicles.</li> <li>Holmium or Ho (67) — Holmium is used in nuclear control rods, microwaves, and magnetic flux concentrators.</li> <li>Erbium or Er (68) — This is used in fiber-optic communication networks and lasers.</li> <li>Thulium or Tm (69) — Thulium is another laser rare earth.</li> <li>Ytterbium or Yb (70) — This mineral is used in cancer treatments, in stainless steel, and in seismic detection devices.</li> <li>Lutetium or Lu (71) — Lutetium can target certain cancers, and is used in petroleum refining and positron emission tomography.</li></ul>
Where Japan found is rare earths<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8xOTA2MTM0OC9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY1MTA0NzUxNn0.N3t_iKf6lnnoJ6yVUtl8-wNZICEG2ZxyPzm9ZdE99ks/img.jpg?width=980" id="021b7" class="rm-shortcode" data-rm-shortcode-id="d9dd843fde547a0b69f8798aca18a706" data-rm-shortcode-name="rebelmouse-image" />
Minimatori Torishima Island
(Chief Master Sergeant Don Sutherland, U.S. Air Force)<p>Japan located the rare earths about 1,850 kilometers off the shore of <a href="https://en.wikipedia.org/wiki/Minami-Tori-shima" target="_blank"><u>Minamitori Island</u></a>. Engineers located the minerals in 10-meter-deep cores taken from sea floor sediment. Mapping the cores revealed and area of approximately 2,500 square kilometers containing rare earths.</p><p>Japan's engineers estimate there's 16 million tons of rare earths down there. That's <a href="https://minerals.usgs.gov/minerals/pubs/historical-statistics/ds140-raree.xlsx" target="_blank"><u>five times</u></a> the amount of the rare earth elements ever mined since 1900. According to <a href="https://www.businessinsider.com.au/rare-earth-minerals-found-in-japan-2018-4?r=US&IR=T" target="_blank"><u>Business Insider</u></a>, there's "enough yttrium to meet the global demand for 780 years, dysprosium for 730 years, europium for 620 years, and terbium for 420 years."</p><p>The bad news, of course, is that Japan has to figure out how to extract the minerals from 6-12 feet under the seabed four miles beneath the ocean surface — that's the <a href="https://www.nature.com/articles/s41598-018-23948-5" target="_blank"><u>next step</u></a> for the country's engineers. The good news is that the location sits squarely within Japan's Exclusive Economic Zone, so their rights to the lucrative discovery will be undisputed.</p>
Technology of the future is shaped by the questions we ask and the ethical decisions we make today.
- Robots (from the Czech word for laborer) began appearing in science fiction in the early 1900s as metaphors for real world ideas and issues surrounding class struggles, labor, and intelligence. Author Ken MacLeod says that the idea that robots would one day rebel was baked into the narrative from the start. As technologies have advanced, so too have our fears.
- "Science fiction can help us to look at the social consequences, to understand the technologies that are beginning to change our lives," says MacLeod. He argues that while robots in science fiction are a reflection of humanity, they have little to do with our actual machines and are "very little help at all in understanding what the real problems and the real opportunities actually are."
- AI has made the threat of "autonomous killer robots" much more of a possibility today than when Asimov wrote his three laws, but it's the decisions we make now that will determine the future. "None of these developments are inevitable," says MacLeod. "They're all the consequences of human actions, and we can always step back and say, 'Do we really want to do this?'"
"The Expanse" is the best vision I've ever seen of a space-faring future that may be just a few generations away.
- Want three reasons why that headline is justified? Characters and acting, universe building, and science.
- For those who don't know, "The Expanse" is a series that's run on SyFy and Amazon Prime set about 200 years in the future in a mostly settled solar system with three waring factions: Earth, Mars, and Belters.
- No other show I know of manages to use real science so adeptly in the service of its story and its grand universe building.
Credit: "The Expanse" / Syfy<p>Now, I get it if you don't agree with me. I love "Star Trek" and I thought "Battlestar Galactica" (the new one) was amazing and I do adore "The Mandalorian". They are all fun and important and worth watching and thinking about. And maybe you love them more than anything else. But when you sum up the acting, the universe building, and the use of real science where it matters, I think nothing can beat "The Expanse". And with a <a href="https://www.rottentomatoes.com/tv/the_expanse" target="_blank">Rotten Tomato</a> average rating of 93%, I'm clearly not the only one who feels this way.</p><p>Best.</p><p>Show.</p><p>Ever. </p>