Core bitcoin developer Luke Dashjr has revealed that he lost almost his entire stock of BTC after his PGP (Pretty Good Privacy) key was compromised just before the new year.
In a tweet on Sunday, the developer said that his PGP key, a common security method that uses two keys to gain access to encrypted information, was somehow compromised by hackers, resulting in the loss of over 200 BTC. The coins were stolen, valued at over $3.5 million.
In response to a Twitter user who asked Daszur if he had any idea how the attackers may have accessed his keys, he said he “didn’t know”.
Some in the crypto community pointed to a possible connection to a previous Twitter post by Dashzer on November 17, which stated that his servers were compromised by a “new malware/backdoor on the system.” However, the developer could not verify this.
In the meantime, Dasher advised the bitcoin community not to download Bitcoin Knots, a combined bitcoin node and wallet that ensures that the bitcoins you receive are both real and de facto, until this issue is resolved. He said:
“Don’t download Bitcoin Knots and trust it until this is resolved. If you’ve already done so in the past few months, consider shutting that system down for now.”
According to his LinkedIn profile, Luke Dashjr has been a Bitcoin Core developer since 2011. He also reportedly has over 23 years of programming experience.
In a comment, Binance CEO Changpeng “CZ” Zhao said he was saddened by the incident and offered support. He also mentioned that self-custody comes with some risks as users need to protect their private keys from theft. He wrote:
“Sorry to see you lost so much. Informed our security team to monitor. If it comes our way, we’ll freeze it. If there’s anything else we can help with, Please let us know. We deal with these frequently, and do law enforcement (LE) relationships around the world.”
The incident once again ignited a debate about self-custody, which later became a hot topic. The Fall of FTX Last year. Joe Vejani, CEO of LunarCrush, a platform that provides social listening analytics for cryptocurrency investors, claimed that the loss is negligible compared to the billions lost by centralized exchanges.
However, Crypto Boss noted that most losses from self-custody are not reported. He added that not all crypto exchanges are FTX and not everyone in crypto is like Sam Bankman-Fried, the infamous founder of the exchange. He said:
“SBF is not equal to all centralized exchanges. Madoff is not equal to all stockbrokers.”
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