Bitcoin value plunges after almost £50m stolen

BitcoinBitcoin has been dealt another blow as 119,756 bitcoins were stolen – a value close to £50 million.

Bitcoin exchange Bitfinex announced “Today we discovered a security breach that requires us to halt all trading on Bitfinex, as well as halt all digital token deposits to and withdrawals from Bitfinex”.

They went on to say “We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen. We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, bitfinex.com will be taken down and the maintenance page will be left up”.

Obviously they are cooperating with law enforcement but that doesn’t immediately help users who have lost their money, even if they eventually have it returned.

The value of Bitcoin has plummeted almost 20% as news of the breach broke, probably as people get nervous and convert their holdings into hard currency.

The only real way to protect yourself against a bitcoin exchange security breach is to hold your bitcoin in a private offline wallet. The danger of holding your funds in a private wallet is of course if you lose your USB stick, your computer crashes or you forget your passphrase then your funds are pretty much gone for good anyway.

Bitcoin might be touted as the future digital cash, but there’s still something to be said for having a stash of cash under the mattress… at least a burglar can only be in one house at a time.