Home / Bitcoins / $100 Million in Stolen Bitcoins — “Sorry About That”
Print Friendly and PDF

$100 Million in Stolen Bitcoins — “Sorry About That”

Written by Gary North on December 5, 2013

A thief has stolen $100 million in Bitcoins.

The exchange that allowed this has gone bust.

There is no FDIC insurance.

There is no way to find the thief. They may catch him when he tries to unload them. But that does not get them back to their owners.

Who’s in charge here? Algorithms and formulas.

It’s all secret, you see. It’s all anonymous. There are no contracts. There are no courts.

Investors who are not the victims shrug their shoulders. A $100 million here, a $100 million there. It’s all a cost of doing business. Someone else’s cost.

“No problem.”

“Easy come, easy go.”

“Here today. Gone tomorrow.”

“Picky, picky, picky.”

“Look, this is a mania,” said one anonymous investor. “Manias are not affected by bad news until the day they collapse. I’m in this for the short haul.” (I made this up, but it’s true.)

Continue Reading on www.businessinsider.com

Print Friendly and PDF

Posting Policy:
We have no tolerance for comments containing violence, racism, vulgarity, profanity, all caps, or discourteous behavior. Thank you for partnering with us to maintain a courteous and useful public environment where we can engage in reasonable discourse. Read more.

16 thoughts on “$100 Million in Stolen Bitcoins — “Sorry About That”

  1. John Gilbert says:

    A thief has stolen $100 million in Bitcoins.

    So, I guess they must be valuable then.

    The exchange that allowed this has gone bust.

    No one allows a thief to steal. That is completely absurd.

    There is no FDIC insurance.

    So, the “Libertarian” North now asserts that FDIC Insurance is a good thing? This is how far you have to go to try and disparage Bitcoin? To say that we are better off with the State “insuring” our property, tangible or intangible? I can scarcely believe what I am reading.

    There is no way to find the thief. They may catch him when he tries to unload them. But that does not get them back to their owners.

    None of this is a argument against Bitcoin as a way of sending money anywhere. None of this disproves the fact that Bitcoin can be used as a money substitute. It does however, demonstrate that Bitcoin is valuable. For the record there are many ways to find the thief, and any attempt to move the Bitcoins can be seen in public in real time. But I imagine that how this is done is not something you are willing to try and understand.

    Who’s in charge here? Algorithms and formulas.

    A Libertarian looking for someone to “be in charge”?!

    It’s all secret, you see. It’s all anonymous. There are no contracts. There are no courts.

    There are courts, its not anonymous and the contracts are those that exist between the buyer and seller of Bitcoins, just as they do in any other transaction, no matter what the object being sold is.

    The rest of this nonsense post I am going to ignore, since its of little value.

    Really Gary, you are completely out of your depth in the subject of Bitcoin. You made a mistake by coming out against it without learning about it first, and now you cannot back down lest your reputation be tarnished. But it already is tarnished, and furthermore, you accept Bitcoin for your books yourself, so all your arguments against it ring hollow.

  2. I'm a free market guy. I personally save my wealth in ounces, not in papers or in bits. This doesn't mean I'm anti-bitcoin. Why on earth would I care if someone else is saving his labor output in real estate documents, government bonds, euros, renminbi, fine wines, or whatever? Your choice of investment vehicle doesn't hurt me…at least in a free-ish market.

    I see the value of bitcoins in evading currency controls. Much better than trying to buy e.g. diamonds in one country, smuggle them out in one's pocket lint, and then resell them in another country. Bitcoins are more fluid and less subject to transactional losses, as well as concerns about quality.

    There is a network effect in any form of currency. The more people who use it, the better off each user is. Just like the internet. It looks like bitcoin has already reached the point where the network effect is in its favor.

  3. Patrick Duffy says:

    Bernanke stole TRILLIONS. Which is worse?

  4. Bernanke is worse because his actions are robbing the poor and middle class. The rich, who he is making much richer will suffer down the line. At least as the rich can suffer. As for those that lose via bitcoins, whoops. See my blog at http://cranky-conservative.blogspot.com

  5. Cliffystones says:

    Based on Mr. North's assertions and those of Mr. Gilbert I can make one assumption with great certainty. It's a lot easier for some brilliant hacker to steal those bitcoins than it is for someone to attempt to break into my house and try to steal my physical currency. The same aspects that make bitcoin useful for electronic transactions also greatly reduce the physical risks a criminal would need to take. For or against bitcoin, that's just a fact.

  6. "So, the "Libertarian" North now asserts that FDIC Insurance is a good thing?"
    He said no such thing.

    "So, I guess they must be valuable then."
    Of course they are valuable, he just doesn't think they will continue to be valuable.

    "A Libertarian looking for someone to "be in charge"?!"
    Libertarians aren't anti-authority.

    "and any attempt to move the Bitcoins can be seen in public in real time. But I imagine that how this is done is not something you are willing to try and understand."

    Hey dumbo, North said, "They may catch him when he tries to unload them. "

    "But it already is tarnished, and furthermore, you accept Bitcoin for your books yourself, so all your arguments against it ring hollow. "

    I refuse to invest in diamonds, but if someone paid me $1,000 worth of diamonds, then I'd accept payment…….. as I would just sell them for what I do want ($). Taking payment and instantly exchanging it is different than INVESTING in something.

    Are you this stupid?

  7. my fear is hackers as well, and i dont trust the tracking system, nor the limit they have imposed on the number of circulating bitcoins. maybe im just not tech savvy enough, but those risks are real.
    If they want credibility all they need do is mint some .9999 pure gold bitcoins- they would sell those so fast your head would spin

  8. Toby Wentworth says:

    Gary has not qualified his objection to Bitcoin by saying that it is good for selling things online but bad as an investment; he says the entire thing is a Ponzi Scheme, and fraudulent by design.

    If he did say it was good for selling online, it would immediately follow that it is good as an investment, since so much of todays "mail order" is done over the internet. It would also follow that it is not inherently fraudulent.

    You cant have it both ways. You cant say that Bitcoin is a Ponzi Scheme, but is good as a payment method. If you concede that it is a good method to pay for goods online, then Bitcoin's value skyrocketing is not due to it being in a bubble, but due to the growing demand for it as a means of payment, and it cannot be a Ponzi Scheme, by definition.

    Even if it is being bought by investors, their actions are rational, since upon analysis of what Bitcoin is, its obvious that if it is a payment method for the internet that is going to replace credit cards, it is in its infancy, and now is the time to take a stake in the limited number of Bitcoins that are going to be created.

  9. There's no need for someone to break into your house to steal your physical currency. 1. Unless you're 90 years old and grew up during the depression, you doubtless do not keep the majority of your money in your house. The $ is an electronic currency, and hackers are stealing it every single day, it's just not news like a Bitcoin theft is. 2. 97% of the value of the dollar was stolen by the Federal Reserve over it's lifetime, and it continues to inflate and steal your money.

    So, what was that about it not being easy to break into your house and steal…?

  10. "If he did say it was good for selling online, it would immediately follow that it is good as an investment"
    Wrong-O

    "You cant have it both ways. You cant say that Bitcoin is a Ponzi Scheme, but is good as a payment method."
    I can instantly redeem Bitcoins for $USD. The price you pay in BTC will be based on the BTC-USD exchange rate. If the merchant decides to not redeem them instantly for $USD, then he has made an investment.

    "it is in its infancy, and now is the time to take a stake in the limited number of Bitcoins that are going to be created. "
    And there is UNLIMITED competition. It is coming. FYI, I like competition.

  11. Bitcoins are a means of exchange, not an investment.

    If you buy Bitcoins as an investment, you are a deluded idiot, no different to foreigners who buy US$ as an investment.

    If I had bought Bitcoins at 20 cents when I had the chance, and still held them at the current $1,200 I would be slowly selling them and buying gold now. Not gold coins, but pure 24 carat bar gold. 999.9 fine gold.

    I would not buy gold as an investment, but as a hedge against what I see as the inevitable collapse in bitcoin value as the whales who hold 90% of the bitcoin out there start to unpload. They must be pulling their hair out trying to devise a way of unloading without crashing the bitcoin market.

  12. Toby Wentworth says:

    "Wrong-O" is not a rebuttal I'm afraid. Bitcoin cannot be a fraud and a sound payment method simultaneously.

    Most merchants online, including Lew Rockwell and The Ludwid von Mises Institute Bookstore, where Gary's books are available in exchange for Bitcoin, are converting the Bitcoin they receive instantly into dollars. Of course, one could retain it and speculate, but merchants are not interested in that. Your argument is a classic Straw Man and fails. Also, we have still not heard from Gary about his position re his books being available for Bitcoin at Mises, as another commenter noticed. It is completely hypocritical to be accepting Bitcoin in payment for his books whilst railing against it as a "criminal scam" on his own site. He should at least be consistent in his activities and stop accepting Bitcoin for his books or publish a full retraction.

    The fact that anyone can download the Bitcoin software and set up their own network is not relevant. The Bitcoin network has billions of dollars of hardware and software running it; it has first mover advantage, and is very unlikely to be unseated, barring crony capitalist intervention. This of course, will only further validate the Bitcoin software, not invalidate it.

  13. I should qualify my above post… I'm not saying Bitcoins is not a valid alternative to Fiat currency, what I'm saying is that if you are buying bitcoin, be sure you understand WHY you are buying it.

  14. Unfortunately Gold BC they can't and won't do that, because it would reveal the idendity of the perpetrators of Bitcoin, and it would admit that Bitcoin requires backing of some sort… and they won't do either.

  15. john Gilbert… you are talking your own book.

    The simple fact is that numbnuts like you are buying bitcoin at $1,200 plus a coin, ONLY because they think that they will sell at a profit in the future.

    That's not what bitcoin is for, or (hopefully) was desighned to be.

    Bitcoin was designed to be an alternative means of exchange to Fiat currency's… nothing more, nothing less.

    Idiots buying bitcoins today hoping to sell at a profit tomorrow are simply … idiots.

  16. New School Posse says:

    This carping about Gary selling "his" books being sold for Bitcoin at the Mises store is garbage. Jeffery Tucker of Mises likes Bitcoin so he probably got their bookstore to accept Bitcoin. Gary North is not in charge of the bookstore. What a red herring.