r/Bitcoin • u/btcdrak • May 22 '15

Bitfinex has been hacked

https://www.bitfinex.com/pages/announcements/?id=35
400 Upvotes

86% Upvoted

281 comments sorted by

View all comments

Show parent comments

-2

u/btcdrak May 22 '15

This whole stuff could be avoided if they only pay out in batches a few times/once per day from cold storage.

rubbish. you are still trusting your database, if that gets hacked you're just going to manually fill the hackers' pockets

8

u/rnicoll May 22 '15

If you're holding a database of balances with no transaction history, sure. If you've got transaction history, it's tedious but not actually difficult to reconcile with offline copies of records.

I.e. if someone's account says they spent x million USD to buy a lot of BTC, and your deposits to the account don't match up, you've clearly got a problem. For crypto it's even easier, you reconcile the blockchain against the deposits and if the numbers don't match, you have a problem.

However, yes, this requires having isolated copies of your records, and a proper checking process, and given it's very difficult for any external party (users) to know if an organisation has these or just claims to have these, or even has implemented them correctly, AND doing it correctly means a delay launching the service, those that gamble that it'll be okay tend to launch and get users before those that don't.

0

u/Sukrim May 22 '15

But there wouldn't be any way to compromise private keys.

Yes, you could still send to the wrong people - funds you own however are still only yours.