Bitcoin “Total Crypto Breakdown” Shows Risks To Non Tangible Assets
By: GoldCore
GoldSeek.com
Thursday, 4 June 2015
– Bitcoin wallet app Blockchain suffers major security blunder
– Poor tech sees multiple accounts being created using same address
– Security lapses in electronic and digital currencies not uncommon
– Bitcoin and cryptocurrencies in infancy but are useful tools
– Physical gold offers most secure form of wealth preservation
Blockchain.com, which claims to be the maker of the most popular Bitcoin wallet, suffered at the weekend what the Guardian describes as a “total crypto breakdown”, highlighting once again the vulnerability of electronic and digital currencies to human and technological error and or hacking.
Multiple accounts were created using the same bitcoin address which meant that many users apparently had access to the same pool of funds which led to losses for a few.
The newspaper reports that a “series of bad development choices” in the software “all failed in the worst way possible”. It was operating in the typical “belt and braces” mode where if one line of defence failed another should still be operational.
“Bitcoin wallets are typically created by randomly generating a public address and a related private key. As a result, it is important for address and key to be truly random, or else it may be possible to guess the private key by looking at the public address.”
In the case of Blockchain.com, the random code was generated from two different sources which were then combined. The first was the random number generator on the device on which the app was being installed.
However, some Android phones failed to deliver the code to the blockchain app which meant its random code was generated entirely from the second source. The second source was an online service called random.org.
“But on 4 January, Random.org strengthened the security of its website, requiring all visits to be made over an encrypted connection. The blockchain app, however, continued to access the site through an unencrypted connection. So rather than getting a random number, as expected, it got an error code telling it that the site had moved.”
The Rest…HERE
