Over the past few weeks, a number of Bitcoin traders and investors have been the target of a major seizure of Bitcoin. The cryptocurrency was seized from cryptoanonymous trader known as “Colonial Pipeline” – an individual who had recently used Bitcoin to pay for illegal drugs.
Earlier this week, we were surprised to see a number of news outlets reporting on a story about the seizure of $13 million worth of Bitcoin from the Colonial Pipeline. The amount of Bitcoin seized was said to be the largest BTC theft in history and the “crime was conducted by hackers stealing the digital currency from the company’s secure network”. The story was very confusing. There was no mention of Bitcoin being stolen in any of the reports. Rather, the story described a security breach at Colonial Pipeline which led to the theft of some Bitcoins.
This week, there have been a lot of news stories about an alleged theft of 1,500 bitcoins from a company called Colonial Pipeline. While this story may be a little exaggerated, the Federal Bureau of Investigation has now confirmed that they are investigating the incident. Whether or not the reported crime is true, this story has raised a lot of questions about the legality of Bitcoin and other digital currencies. The question that remains is whether or not there will be any consequences for the company that was allegedly hacked.The seventh. In June, the US Department of Justice and the Federal Bureau of Investigation (FBI) announced that 63.70 bitcoins had been recovered from Colonial Pipeline funds sent to hackers. The official story contains a number of contradictions, and federal investigators have not revealed how the FBI was able to seize the private key from the Darkside gang.
Story of a Darkside ransomware gang with inconsistencies and an unclear bitcoin key takeover
The crypto-currency space discusses the recent seizure of 63.7 BTC, or 2.3 million bitcoins, by law enforcement at the time of the bust. There have been problems with the way the story has unfolded, and people are skeptical of the official version. Bitcoin.com News reported Monday how the Department of Justice and Assistant Attorney General Lisa Monaco brought out the story of the seizure. Monaco told us that the federal government was turning over all the cards for Darkseid. But since this story was published by some mainstream media, several inconsistencies have been discovered. The first question is whether the U.S. government advised Colonial Pipeline to comply with the ransomware’s demands or specifically ordered the company to pay up. If the government ordered companies to pay Darkside, it would contradict its position of not paying ransoms to hackers. When the CEO called the FBI, they said the FBI had experts from the dark side working in CA – the CEO of Colonial Pipeline. This is where the warrant was issued. Did they just get the keys to the FBI office? – Zr1Trader (@ZR1Trader) 8. June 2021 Another problem with the original story is that when CNN initially reported the hack, they claimed that the oil company would not pay the ransom. According to Bloomberg, Colonial Pipeline paid nearly $5 million to an extortionist gang shortly thereafter. In addition to the two conflicting elements in the CNN and Bloomberg articles, the articles also pointed out differences in the digital currencies used. CNN initially reported that the payment had been requested in bitcoin, and Bloomberg wrote that Darkside had asked for hard-to-trace cryptocurrencies. The CNN article was updated after the Bloomberg article to reflect the same story. Moreover, it is impossible to crack a Bitcoin (BTC) key without forcing the owner to reveal his private key. It’s a recurring topic on Twitter, with the cryptocurrency community discussing how an FBI agent got a private key. The affidavit, filed on 7. June 2021 filed, explains how law enforcement agencies have used blockchain researchers to track coins. But otherwise, the affidavit is extremely vague and contains many shortcuts. But how did they get the private key? It looks suspicious. The FBI has taken control of BTC DarkSide and gained access to a central account….. They were able to access the private key of one of the BTC wallets. We don’t know how the key was compromised. – Squanchy (@C_OneThreeSeven) 8. June 2021 A report published yesterday on Bitcoin.com News explains that Blockchain Intelligence Group (CSE: BIGG) executives point out that enforcement depends on learning and analysis [which] requires advanced tools and training. Other blockchain monitoring companies have also tracked ransomware tokens, as Elliptic recently wrote when it tracked Darkside’s funds. So far, between all the comments from Monaco, the Department of Justice, the FBI agent’s affidavit, and comments from various blockchain analysis groups, there is not a single point that is deeply related to how the FBI came into possession of the private key they now have.
The cryptography community is looking for possible leads.
A report published by NPR describes three possible scenarios. One possibility, Vanessa Romo notes, is that federal agents obtained information from a Darkseid Gang insider. The second theory is that Darkseid was careless, or that one of the gang members made a mistake and gave away information about the key. Another theory could be that the FBI successfully siphoned off information from a third party or possibly a cryptocurrency exchange. Some people have even openly attacked bitcoin’s main benefits, which is that it would be out of reach of the government. Something about this case seems strange. Have the BTCs been sent to the exchange? – Rick McCracken DIGI (@RichardMcCrackn) June 8, 2021 Attorney Jake Czerwinski, a frequent commentator on blockchain and the crypto space, regularly states: We don’t know exactly how the FBI seized the Colonial Pipeline ransom, [and] they don’t tell us about it. Before applying for the warrant, they must have obtained a private key. Maybe because of the takeover of the DarkSide server? There is no indication that an exchange or custodian was involved, but it is possible. Freelance journalist Jordan Shachtel addressed the situation on Twitter, telling his 123,000 followers that the FBI has not hacked into the Bitcoin wallet, despite claims to the contrary. It is mathematically impossible to crack private keys. Schachtel continued: There is] no evidence of Russian involvement. All this could have been avoided if basic safety measures had been taken in the Colonies. I think it’s fair to say that private keys are currently impossible to hack. Unlikely is not an expression strong enough to indicate how unlikely it is that a private key will be preserved using computer power. Quantum is still a theoretical threat. Shachtel and many others also discovered the warrant, suggesting that the US government obtained the key using the warrant. The reporter said it could be a stock exchange in San Francisco or a database server in California. Coinbase CEO Philip Martin said he has seen numerous allegations suggesting Coinbase may have been involved in the takeover. Martin and Coinbase maintain that Coinbase was not the target of the order and did not receive the refund or any part of the refund at any time. We also have no proof that the money went through the Coinbase account/wallet. Brian Jacauto, a lawyer and head of the Bitcoin group, confirmed that Bitcoin’s private keys cannot be hacked. For those who believe the US government hacked SHA-256 and correctly guessed the private key of the Colonial Pipeline hackers, Jacouto said. Here’s a fun fact: The size of the Bitcoin private key space is 10^77. By comparison : The number of atoms in the observable universe is 10^80. A Twitter user nicknamed Cthulhu said it could be a false flag and said: So either the FBI were Colonial Pipeline hackers, or they don’t need a key to get BTC from anyone. LOL. I don’t think much thought went into making this false flag. The FBI either handed out locked keys or stole them, another person under the pseudonym Kingt Crypto noted Monday. As the story continues to circulate online, many skeptics are questioning the official version being told by the US government. Do you believe the government’s official version of the Colonial Pipeline bitcoin ransomware case? Let us know what you think in the comments below.
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2.3 million, bitcoin, bitcoin (BTC), bitcoin seizure, Colonial Pipeline, Darkside, Department of Justice (DOJ), Assistant Attorney General, DOJ, FBI, Lisa Monaco, ransomware, hackers, history, United States, U.S. agents Photo credit: Shutterstock, Pixabay, Wiki Commons, Twitter, Denial: This article is for information only. It is not a direct offer or invitation to buy or sell, nor is it a recommendation or endorsement of any goods, services or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author shall be liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services referred to in this article.Thieves may be recovering 500 Bitcoins, but they are not likely to get away with the whole haul. An earlier bitcoin heist was a failure because the robbers got sloppy. They left a trail of evidence behind that led police to the bitcoin’s recovery. And the bitcoin platform may be able to recover the lost coins even if the pirates don’t go to jail. Also, the story of the failed heist could be used to inspire others to become Bitcoin users.. Read more about can bitcoin be hacked by quantum computers and let us know what you think.
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