Bit LC Theft - Revision history

Azoundria: Another 30 minutes complete. Added more information from BitcoinTalk discussions. Filling in additional details and community reactions.

2024-02-14T18:38:17Z

Another 30 minutes complete. Added more information from BitcoinTalk discussions. Filling in additional details and community reactions.

← Older revision		Revision as of 12:38, 14 February 2024
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	{{Case Study Under Construction}}		{{Case Study Under Construction}}
	[[File:Bitlcnet.jpg\|thumb\|Bit LC Logo/Homepage]]		[[File:Bitlcnet.jpg\|thumb\|Bit LC Logo/Homepage]]
	BitLC was a service provider website which offered a mining pool, online wallet, and a bitcoin exchange. On February 13th, 2013, the website went offline claiming that all coins in the cold storage wallet had been taken by an investor. Users remain with no recovery and limited answers about what happened.		BitLC was a service provider website which offered a mining pool, online wallet, and a bitcoin exchange. On February 13th, 2013, the website went offline with the founder Jim Nelin claiming that all coins in the cold storage wallet had been taken by an investor named Erick. Users remain with no recovery and limited answers about what happened.

	== About Bit LC ==		== About Bit LC ==
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	== The Reality ==		== The Reality ==
	Funds on the BitLC platform cold storage were directly accessible by platform operators including an individual named Erick. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform by ~~Erick~~. The homepage of the service emphasized the anonymous nature of the bitcoin network<ref name=":0" />.<blockquote>Bitcoin's peer-to-peer topology and lack of central administration make it infeasible for any authority, governmental or otherwise, to manipulate the value of Bitcoins or induce inflation by producing more of them. It also makes it near-impossible trace to you as a person.</blockquote>		Funds on the BitLC platform cold storage were apparently directly accessible by platform operators including an individual named Erick. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform by founder Jim Nelin<ref name=":4">[https://bitcointalk.org/index.php?topic=10121.msg1533482#msg1533482 Jine - "Mark me as whatever you want, my mission here is to get "my baby" back online and retrieve the funds. This wasn't anything that i either choice nor wanted, if i really wanted to scam anyone, i could have taken out all those funds my self." - BitcoinTalk] (Feb 14, 2024)</ref>.

			The homepage of the service emphasized the anonymous nature of the bitcoin network<ref name=":0" />.<blockquote>Bitcoin's peer-to-peer topology and lack of central administration make it infeasible for any authority, governmental or otherwise, to manipulate the value of Bitcoins or induce inflation by producing more of them. It also makes it near-impossible trace to you as a person.</blockquote>

	== What Happened ==		== What Happened ==
	~~In mid-January~~ a large investor of the BitLC exchange platform reportedly took the funds from the cold storage wallet.		According to reports in February, a large investor of the BitLC exchange platform reportedly took the funds from the cold storage wallet in mid-January.
	{\| class="wikitable"		{\| class="wikitable"
	\|+Key Event Timeline - Bit LC Theft		\|+Key Event Timeline - Bit LC Theft
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	== Technical Analysis ==		== Technical Analysis ==
	"This alleged theft was unique in that coins held in the hot wallet were safe, but coins held in a cold wallet compromised. The thief is not expected to have access to the coins regardless, so there was little financial gain from this theft. Erick, allegedly the only one with physical access to Bit LC Inc.'s cold wallet, has failed to communicate and withdraw coins. Bit LC Inc. therefore was required to declare bankruptcy. There is no proof that Erick intentionally stole the coins; indeed, some evidence asserts that he or she may simply have disappeared in some manner."		"This alleged theft was unique in that coins held in the hot wallet were safe, but coins held in a cold wallet compromised. The thief is not expected to have access to the coins regardless, so there was little financial gain from this theft. Erick, allegedly the only one with physical access to Bit LC Inc.'s cold wallet, has failed to communicate and withdraw coins. Bit LC Inc. therefore was required to declare bankruptcy. There is no proof that Erick intentionally stole the coins; indeed, some evidence asserts that he or she may simply have disappeared in some manner."

			After the fact, Jim Nelin reports on having trust issues with Erick earlier in the process. It appears to suggest that some form of scheme was used to protect the cold storage key, however specific details appear elusive<ref name=":4" />.<blockquote>I couldn't trust even Erick with the encryption key - just to avoid situations like these - where he actually could use the funds.

			I'm paranoid in that way of thinking, you wouldn't even begin to understand how much.

			I actually had/have (unsure if i still do) a copy of the cold storage wallet to (not identical, but pretty close), encrypted with HIS gpg-key (this way - it became failsafe - it required 2 parties to get access to it).</blockquote>

	== Total Amount Lost ==		== Total Amount Lost ==
			The peak amount of bitcoin on the platform was 8,000 bitcoin, and the final amount was much less than this<ref name=":4" />.

	The total amount lost has been estimated at $51,000 USD.		The total amount lost has been estimated at $51,000 USD.

	== Immediate Reactions ==		== Immediate Reactions ==
	The Bit LC website displayed a notice ~~shortly~~ after the cold wallet was emptied<ref name="archivearchive-21" />.		Many users were unaware of the

			=== Initial Notice On Bit LC Website ===
			The Bit LC website displayed a notice approximately a month after the cold wallet was reportedly emptied<ref name="archivearchive-21" />.

	<ref>https://bitcointalk.org/index.php?topic=175693.0</ref><ref>https://bitcointalk.org/index.php?topic=351513.0</ref>		<ref>https://bitcointalk.org/index.php?topic=175693.0</ref><ref>https://bitcointalk.org/index.php?topic=351513.0</ref>

	== ~~Ultimate Outcome~~ ==		=== Community Reactions To Collapse ===
	The ~~incident was ultimately included in~~ a ~~list posted~~ on the BitcoinTalk ~~forum~~<ref ~~name~~="~~bitcointalklistold~~-20" /><ref name="~~bitcointalklist-87~~" />, and ~~propagated~~ to ~~other lists~~.		Multiple users posted their reactions on the BitcoinTalk forum<ref>[https://bitcointalk.org/index.php?topic=10121.msg1528758#msg1528758 ragmondo - "Posting for two reasons - firstly does anybody know what's going on here ? The "press release" raises more questions than it answers .... And also to bump it to the recent posts list." - BitcoinTalk] (Feb 14, 2024)</ref><ref>[https://bitcointalk.org/index.php?topic=10121.msg1602277#msg1602277 <nowiki>pandemic - "can we get a bit more information about [what] is going on? I read the release but it really answered nothing. There are missing coins and some guy named Erick who could never guess the password or something?!" - BitcoinTalk</nowiki>] (Feb 14, 2024)</ref><ref>[https://bitcointalk.org/index.php?topic=10121.msg1766838#msg1766838 organofcorti - "Jine's story does sound like something Elmore Leonard would have written." - BitcoinTalk] (Feb 14, 2024)</ref>.<blockquote>Posting for two reasons - firstly does anybody know what's going on here ? The "press release" raises more questions than it answers .... And also to bump it to the recent posts list.</blockquote><blockquote>can we get a bit more information about wtf is going on? I read the release but it really answered nothing. There are missing coins and some guy named Erick who could never guess the password or something?!</blockquote><blockquote>Jine's story does sound like something Elmore Leonard would have written.</blockquote>

			=== Denials By Jim Nelin ===
			Jim Nelin has denied taking the funds on multiple occasions<ref name=":4" />.<blockquote>Mark me as whatever you want, my mission here is to get "my baby" back online and retrieve the funds.

			This wasn't anything that i either choice nor wanted, if i really wanted to scam anyone, i could have taken out all those funds my self.

			If i recall correctly, the record in funds we ever had was close to 8000 BTC at one moment. That's a lot more then what's we're missing now.

			'''An update tho''':

			A few interested investors have contacted me the past day wanting to buy-out everything under the agreement of supplying the us with the lost funds.

			I will keep the contact with them and you some-how updated, and let you know how this turns out.

			Currently that sounds a awesome solution, as I'm willing to give up everything just to get you funds back.

			If if i had any savings personally, i would use those to compensate for the lost - trust me.</blockquote>

			== Ultimate Outcome ==
			The incident was included in a list posted on the BitcoinTalk forum<ref name="bitcointalklistold-20" /><ref name="bitcointalklist-87" />, and propagated to other lists. Some further updates from Jim Nelin were received, which were not very promising.
	=== July 2013 Updates ===		=== July 2013 Updates ===
	Jine returned to BitcoinTalk in July 2013.<blockquote>You deserve an update regarding this. I can say that nothing what so ever have changed in this matter.		Jine returned to BitcoinTalk in July 2013.<blockquote>You deserve an update regarding this. I can say that nothing what so ever have changed in this matter.
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	I haven't visited bitcointalk since my last post, at all.</blockquote>		I haven't visited bitcointalk since my last post, at all.</blockquote>



	Jine went inactive in 2016<ref name=":2">[https://bitcointalk.org/index.php?action=profile;u=14418 Profile of Jine - BitcoinTalk]</ref>.		Jine went inactive in 2016<ref name=":2">[https://bitcointalk.org/index.php?action=profile;u=14418 Profile of Jine - BitcoinTalk]</ref>.

	The BitLC website has been replaced with a cryptocurrency website<ref>https://bitlc.net/</ref>.		The BitLC website has been replaced with another cryptocurrency website<ref>https://bitlc.net/</ref>.


	== Total Amount Recovered ==		== Total Amount Recovered ==
	There do not appear to have been any funds recovered in this case.		There do not appear to have been any funds recovered in this case. While some interest was reportedly expressed by potential investors to buy the platform by paying losses<ref name=":4" />, it does not appear that any of those panned out.

	== Ongoing Developments ==		== Ongoing Developments ==

Azoundria: Another 30 minutes complete. More information integrated from Bitcoin Talk. Significant research onto the end future of Jine and ultimate outcomes.

2024-02-14T00:54:32Z

Another 30 minutes complete. More information integrated from Bitcoin Talk. Significant research onto the end future of Jine and ultimate outcomes.

@@ Line 5: / Line 5: @@
 == About Bit LC ==
 The exchange was reportedly based in Panama. Description from the homepage<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>:<blockquote>We are a ''Bitcoin Service Provider'' offering '''free''' and low cost Bitcoin Services, such as a high-end mining pool, online wallet service, bitcoin exchange and a lot more. We're using cutting edge technology to provide you with the best and most secure services available. Our system have full IPv6 support, is built with highest possible security measurements and we're adding new features and services continuously.</blockquote>Website: bitlc.net<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>
 Director: Javier Lopez<ref>[https://www.dnb.com/business-directory/company-profiles.bit_lc_inc.1a9f584203d2024cc35f3bb33cf15a7f.html Bit LC - DNB Business Directory] (Jan 26, 2024)</ref>
-Founder: Jim Nelin<ref name="archivearchive-21" /> who is BitcoinTalk user Jine.
+Founder: Jim Nelin<ref name="archivearchive-21" /> (BitcoinTalk user Jine<ref name=":2" />). Reportedly from Sweden<ref name=":2" />.
-<ref>https://bitcointalk.org/index.php?topic=62988.0</ref>
+<ref>[https://bitcointalk.org/index.php?topic=62988.0 <nowiki>[BITLC] Change of payment scheme for Bitlc.net (Previously bitcoins.lc) - BitcoinTalk</nowiki>]</ref>
 == The Reality ==
-Funds on the BitLC platform cold storage were directly accessible by the platform operator, who was apparently named Erick. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform by Erick. The homepage of the service emphasized the anonymous nature of the bitcoin network<ref name=":0" />.<blockquote>Bitcoin's peer-to-peer topology and lack of central administration make it infeasible for any authority, governmental or otherwise, to manipulate the value of Bitcoins or induce inflation by producing more of them. It also makes it near-impossible trace to you as a person.</blockquote>
+Funds on the BitLC platform cold storage were directly accessible by platform operators including an individual named Erick. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform by Erick. The homepage of the service emphasized the anonymous nature of the bitcoin network<ref name=":0" />.<blockquote>Bitcoin's peer-to-peer topology and lack of central administration make it infeasible for any authority, governmental or otherwise, to manipulate the value of Bitcoins or induce inflation by producing more of them. It also makes it near-impossible trace to you as a person.</blockquote>
 == What Happened ==
@@ Line 24: / Line 22: @@
 !Event
 !Description
 |-
 |January 15th, 2013 3:32:53 PM MST
@@ Line 40: / Line 42: @@
 |Capture Of Website Notice
 |The BitLC website is captured with details of the bankruptcy/closure of the BitLC platform<ref name="archivearchive-21" />.
 |-
 |October 23rd, 2023 12:26:09 PM MDT
@@ Line 60: / Line 82: @@
 The incident was ultimately included in a list posted on the BitcoinTalk forum<ref name="bitcointalklistold-20" /><ref name="bitcointalklist-87" />, and propagated to other lists.
 Jine went inactive in 2016<ref>https://bitcointalk.org/index.php?action=profile;u=14418</ref>.
 The BitLC website has been replaced with a cryptocurrency website<ref>https://bitlc.net/</ref>.
 == Total Amount Recovered ==

Azoundria: COMPLETE Another 30 minutes. Added prevention section to the wiki with further details. Reviewed and promoted on a Reddit post which was found. Integrated additional sources.

2024-01-30T19:17:49Z

COMPLETE Another 30 minutes. Added prevention section to the wiki with further details. Reviewed and promoted on a Reddit post which was found. Integrated additional sources.

← Older revision		Revision as of 13:17, 30 January 2024
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	{{Case Study Under Construction}}		{{Case Study Under Construction}}
			[[File:Bitlcnet.jpg\|thumb\|Bit LC Logo/Homepage]]
	Bit LC was a service provider website which offered a mining pool, online wallet, and a bitcoin exchange. On February 13th, 2013, the website went offline claiming ~~that the service was hacked and~~ that all ~~user funds from~~ the cold storage wallet ~~were lost~~.		BitLC was a service provider website which offered a mining pool, online wallet, and a bitcoin exchange. On February 13th, 2013, the website went offline claiming that all coins in the cold storage wallet had been taken by an investor. Users remain with no recovery and limited answers about what happened.

	== About Bit LC ==		== About Bit LC ==
	The exchange was reportedly based in Panama. Description from the homepage<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>:<blockquote>We are a ''Bitcoin Service Provider'' offering '''free''' and low cost Bitcoin Services, such as a high-end mining pool, online wallet service, bitcoin exchange and a lot more. We're using cutting edge technology to provide you with the best and most secure services available. Our system have full IPv6 support, is built with highest possible security measurements and we're adding new features and services continuously.</blockquote>Website: bitlc.net<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>		The exchange was reportedly based in Panama. Description from the homepage<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>:<blockquote>We are a ''Bitcoin Service Provider'' offering '''free''' and low cost Bitcoin Services, such as a high-end mining pool, online wallet service, bitcoin exchange and a lot more. We're using cutting edge technology to provide you with the best and most secure services available. Our system have full IPv6 support, is built with highest possible security measurements and we're adding new features and services continuously.</blockquote>Website: bitlc.net<ref name=":0">[https://web.archive.org/web/20130115223253/https://www.bitlc.net/ BitLC Homepage Archive January 15th, 2013 3:32:53 PM MST] (Jan 26, 2024)</ref>



	Director: Javier Lopez<ref>[https://www.dnb.com/business-directory/company-profiles.bit_lc_inc.1a9f584203d2024cc35f3bb33cf15a7f.html Bit LC - DNB Business Directory] (Jan 26, 2024)</ref>		Director: Javier Lopez<ref>[https://www.dnb.com/business-directory/company-profiles.bit_lc_inc.1a9f584203d2024cc35f3bb33cf15a7f.html Bit LC - DNB Business Directory] (Jan 26, 2024)</ref>

	Founder: Jim Nelin<ref name="archivearchive-21" />		Founder: Jim Nelin<ref name="archivearchive-21" /> who is BitcoinTalk user Jine.

			<ref>https://bitcointalk.org/index.php?topic=62988.0</ref>

	== The Reality ==		== The Reality ==
	Funds on the ~~Bit LC~~ platform cold storage were directly accessible to the platform operator. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform.		Funds on the BitLC platform cold storage were directly accessible by the platform operator, who was apparently named Erick. There were no access restrictions preventing the entirety of the customer funds from being transferred away from the platform by Erick. The homepage of the service emphasized the anonymous nature of the bitcoin network<ref name=":0" />.<blockquote>Bitcoin's peer-to-peer topology and lack of central administration make it infeasible for any authority, governmental or otherwise, to manipulate the value of Bitcoins or induce inflation by producing more of them. It also makes it near-impossible trace to you as a person.</blockquote>

	== What Happened ==		== What Happened ==
	~~The specific events~~ of the ~~loss and how it came about. What actually happened to cause~~ the ~~loss and some of~~ the ~~events leading up to it~~.		In mid-January a large investor of the BitLC exchange platform reportedly took the funds from the cold storage wallet.
	{\| class="wikitable"		{\| class="wikitable"
	\|+Key Event Timeline - Bit LC Theft		\|+Key Event Timeline - Bit LC Theft
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	\|Capture Of Website Notice		\|Capture Of Website Notice
	\|The BitLC website is captured with details of the bankruptcy/closure of the BitLC platform<ref name="archivearchive-21" />.		\|The BitLC website is captured with details of the bankruptcy/closure of the BitLC platform<ref name="archivearchive-21" />.
			\|-
			\|October 23rd, 2023 12:26:09 PM MDT
			\|New Reddit Thread
			\|A new Reddit thread is posted on the BitLC theft<ref name=":1">[https://old.reddit.com/r/Bitcoin/comments/17erb72/victims_of_bitlcnet_almost_a_decade_ago/ Victims of BitLC.net almost a decade ago - Reddit] (Jan 30, 2024)</ref>.
	\|}		\|}

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	== Immediate Reactions ==		== Immediate Reactions ==
	The Bit LC website displayed a notice shortly after the cold wallet was emptied<ref name="archivearchive-21" />.		The Bit LC website displayed a notice shortly after the cold wallet was emptied<ref name="archivearchive-21" />.

			<ref>https://bitcointalk.org/index.php?topic=175693.0</ref><ref>https://bitcointalk.org/index.php?topic=351513.0</ref>

	== Ultimate Outcome ==		== Ultimate Outcome ==
	The incident was ultimately included in the BitcoinTalk forum<ref name="bitcointalklistold-20" /><ref name="bitcointalklist-87" />.		The incident was ultimately included in a list posted on the BitcoinTalk forum<ref name="bitcointalklistold-20" /><ref name="bitcointalklist-87" />, and propagated to other lists.

			Jine went inactive in 2016<ref>https://bitcointalk.org/index.php?action=profile;u=14418</ref>.

			The BitLC website has been replaced with a cryptocurrency website<ref>https://bitlc.net/</ref>.

	== Total Amount Recovered ==		== Total Amount Recovered ==
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	== Ongoing Developments ==		== Ongoing Developments ==
	~~What parts~~ of ~~this case~~ are still ~~remaining to~~ be ~~concluded?~~		A recent Reddit post in 2013 has renewed the calls for an investigation, although the post faced limited engagement by the Reddit community<ref name=":1" />.<blockquote>About 11 years ago there was a mining pool called BitLC.net and it was pretty decent pool. A bunch of people were using it when it suddenly went offline and there is speculation that Jine, the owner, stole the funds.

			I'm going to consolidate some information here and it's my plan to look into things more. If it seems that the funds are still in a cold wallet and untouched over the past 10 years there likely isn't anything that can be done. If the funds have moved I will look into legal options.</blockquote>

	== Individual Prevention Policies ==		== Individual Prevention Policies ==
	{{Prevention:Individuals:~~Placeholder~~}}		{{Prevention:Individuals:Avoid Third Party Custodians}}

			{{Prevention:Individuals:Store Funds Offline}}

	{{Prevention:Individuals:End}}		{{Prevention:Individuals:End}}
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	Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.		Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.

	{{Prevention:Platforms:~~Placeholder~~}}		{{Prevention:Platforms:Implement Multi-Signature}}

			{{Prevention:Platforms:Establish Industry Insurance Fund}}

	{{Prevention:Platforms:End}}		{{Prevention:Platforms:End}}

	== Regulatory Prevention Policies ==		== Regulatory Prevention Policies ==
	{{Prevention:Regulators:~~Placeholder~~}}		{{Prevention:Regulators:Platform Security Assessments}}

			{{Prevention:Regulators:Establish Industry Insurance Fund}}

	{{Prevention:Regulators:End}}		{{Prevention:Regulators:End}}

Azoundria: Another 30 minutes. About stub moved to technical analysis. All sources integrated. About to prevention, and wrote a new basic description of the case. Introduction, reality, and other sections populated with basic information. Reviewed the website homepage for further information that was available there.

2024-01-26T23:58:12Z

Another 30 minutes. About stub moved to technical analysis. All sources integrated. About to prevention, and wrote a new basic description of the case. Introduction, reality, and other sections populated with basic information. Reviewed the website homepage for further information that was available there.

Show changes

Azoundria at 23:52, 12 April 2023

2023-04-12T23:52:21Z

← Older revision		Revision as of 17:52, 12 April 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}}		{{Imported Case Study 2\|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}}
	{{Unattributed ~~Citations~~}}		{{Unattributed Sources}}

	Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.		Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.

	This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.		This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.<ref name="bitcointalklistold-20" /><ref name="archivearchive-21" /><ref name="bitcointalklist-87" />
	<ref name="bitcointalklistold-20" /><ref name="archivearchive-21" /><ref name="bitcointalklist-87" />

	== About Bit LC ==		== About Bit LC ==
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	!Description		!Description
	\|-		\|-
	\|February 1st, 2013 12:00:16 AM		\|February 1st, 2013 12:00:16 AM MST
	\|Main Event		\|Main Event
	\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.		\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
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	== Ongoing Developments ==		== Ongoing Developments ==
	What parts of this case are still remaining to be concluded?		What parts of this case are still remaining to be concluded?
			== General Prevention Policies ==
			Coming soon.
			== Individual Prevention Policies ==
			{{Prevention:Individuals:Placeholder}}

			{{Prevention:Individuals:End}}

	== Prevention Policies ==		== Platform Prevention Policies ==
	~~Coming soon.~~		{{Prevention:Platforms:Placeholder}}

			{{Prevention:Platforms:End}}

			== Regulatory Prevention Policies ==
			{{Prevention:Regulators:Placeholder}}

			{{Prevention:Regulators:End}}

	== References ==		== References ==
	<references><ref name="bitcointalklistold-20">[https://bitcointalk.org/index.php?topic=83794.msg923918#post_toc_27 <nowiki>List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses [Old]</nowiki>] (Jan 27, 2020)</ref>		<references><ref name="bitcointalklistold-20">[https://bitcointalk.org/index.php?topic=83794.msg923918#post_toc_27 <nowiki>List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses [Old]</nowiki>] (Jan 28, 2020)</ref>

	<ref name="archivearchive-21">[http://web.archive.org/web/20130302231015/https://www.bitlc.net/ Bit LC Inc. closing all services, effective immediately - Bitlc.net] (Feb 3, 2020)</ref>		<ref name="archivearchive-21">[http://web.archive.org/web/20130302231015/https://www.bitlc.net/ Bit LC Inc. closing all services, effective immediately - Bitlc.net] (Feb 4, 2020)</ref>

	<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref></references>		<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref></references>

Azoundria at 20:53, 15 February 2023

2023-02-15T20:53:26Z

← Older revision		Revision as of 14:53, 15 February 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}}		{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}}
			{{Unattributed Citations}}

	Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.		Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.

	This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.		This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.
			<ref name="bitcointalklistold-20" /><ref name="archivearchive-21" /><ref name="bitcointalklist-87" />

	== About Bit LC ==		== About Bit LC ==
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	Don't Include:		Don't Include:

	* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.		* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
	* Anything that wasn't reasonably knowable at the time of the event.		* Anything that wasn't reasonably knowable at the time of the event.
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	\|-		\|-
	\|February 1st, 2013 12:00:16 AM		\|February 1st, 2013 12:00:16 AM
	\|~~First~~ Event		\|Main Event
	\|~~This is an expanded~~ description of what happened and the impact. If multiple lines are necessary, add them here.		\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
	\|-
	\|
	\|
	\|
	\|-		\|-
	\|		\|
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	== Total Amount Lost ==		== Total Amount Lost ==
	$51 000 USD		The total amount lost has been estimated at $51,000 USD.

	How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?		How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

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	== Total Amount Recovered ==		== Total Amount Recovered ==
	~~$0 USD~~		There do not appear to have been any funds recovered in this case.

	What funds were recovered? What funds were reimbursed for those affected users?		What funds were recovered? What funds were reimbursed for those affected users?

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	== References ==		== References ==
	[https://bitcointalk.org/index.php?topic=83794.msg923918#post_toc_27 <nowiki>List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses [Old]</nowiki>] (Jan 27)		<references><ref name="bitcointalklistold-20">[https://bitcointalk.org/index.php?topic=83794.msg923918#post_toc_27 <nowiki>List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses [Old]</nowiki>] (Jan 27, 2020)</ref>

	[http://web.archive.org/web/20130302231015/https://www.bitlc.net/ Bit LC Inc. closing all services, effective immediately - Bitlc.net] (Feb 3)		<ref name="archivearchive-21">[http://web.archive.org/web/20130302231015/https://www.bitlc.net/ Bit LC Inc. closing all services, effective immediately - Bitlc.net] (Feb 3, 2020)</ref>

	[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 14)		<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref></references>

Azoundria: Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}} Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices. This exchange or platform is based in Panama, or the incident targeted people primarily in Panama. == About Bit..."

2023-01-21T06:20:15Z

Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}} Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices. This exchange or platform is based in Panama, or the incident targeted people primarily in Panama. == About Bit..."

New page

{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/bitlctheft.php}}

Cold storage needs to be a proper multi-signature wallet with all keys stored completely offline. One person should not hold all the keys, especially an unknown person. There needs to be training in place to ensure that all operators are fully aware of best practices.

This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.

== About Bit LC ==
"This alleged theft was unique in that coins held in the hot wallet were safe, but coins held in a cold wallet compromised. The thief is not expected to have access to the coins regardless, so there was little financial gain from this theft. Erick, allegedly the only one with physical access to Bit LC Inc.'s cold wallet, has failed to communicate and withdraw coins. Bit LC Inc. therefore was required to declare bankruptcy. There is no proof that Erick intentionally stole the coins; indeed, some evidence asserts that he or she may simply have disappeared in some manner."

This exchange or platform is based in Panama, or the incident targeted people primarily in Panama.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

* Known history of when and how the service was started.
* What problems does the company or service claim to solve?
* What marketing materials were used by the firm or business?
* Audits performed, and excerpts that may have been included.
* Business registration documents shown (fake or legitimate).
* How were people recruited to participate?
* Public warnings and announcements prior to the event.

Don't Include:

* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
* Anything that wasn't reasonably knowable at the time of the event.
There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

== The Reality ==
This sections is included if a case involved deception or information that was unknown at the time. Examples include:

* When the service was actually started (if different than the "official story").
* Who actually ran a service and their own personal history.
* How the service was structured behind the scenes. (For example, there was no "trading bot".)
* Details of what audits reported and how vulnerabilities were missed during auditing.

== What Happened ==
The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.
{| class="wikitable"
|+Key Event Timeline - Bit LC Theft
!Date
!Event
!Description
|-
|February 1st, 2013 12:00:16 AM
|First Event
|This is an expanded description of what happened and the impact. If multiple lines are necessary, add them here.
|-
|
|
|
|-
|
|
|
|}

== Total Amount Lost ==
$51 000 USD
How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

== Immediate Reactions ==
How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

== Ultimate Outcome ==
What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

== Total Amount Recovered ==
$0 USD
What funds were recovered? What funds were reimbursed for those affected users?

== Ongoing Developments ==
What parts of this case are still remaining to be concluded?

== Prevention Policies ==
Coming soon.

== References ==
[https://bitcointalk.org/index.php?topic=83794.msg923918#post_toc_27 <nowiki>List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses [Old]</nowiki>] (Jan 27)

[http://web.archive.org/web/20130302231015/https://www.bitlc.net/ Bit LC Inc. closing all services, effective immediately - Bitlc.net] (Feb 3)

[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 14)