Hacker News

points by NoidFonsense 7 hours ago | 0 comments

If your crypto was stolen in this, it wasn't your crypto. It is simply cryptocurrency that has been reallocated from an exchange to a more competent party, as the free market intended.

[–] nl 6 hours ago

I don't think the security trade-off for most people is clear here.

Given things like the ledger hardware attack[1] I think the time indexed risk of using a centralized exchange is probably lower than doing self-custody.

I understand that many people do self-custody for philosophical reasons, but I think trying to disguise this as a security decision ("If your crypto was stolen in this, it wasn't your crypto.") is arguable at best.

[1] https://www.ft.com/content/70f69253-6017-4259-95c9-48bf0e088...

[–] done_lurking 2 hours ago

Self custody doesn't require using a hardware ledger, and such gadgets represent a very small minority of self-custody wallets. In addition, there are noteworthy non-security risks when using an exchange. There's fraud, illiquidity, new legislation, asset forfeiture, and innumerable other reasons why an exchange might prevent you from withdrawing your funds. I think it's naive to suggest that self-custody is just a novelty with no value.

[–] nl 1 hour ago

> Self custody doesn't require using a hardware ledger

Does this mean you recommend not using one? Because that goes against all the common best practice recommendations from when I did a couple of years working in Web3 stuff a few years back.

> I think it's naive to suggest that self-custody is just a novelty with no value.

That's not what I suggested.

I suggested that it is less secure over time than centralized exchanges, even with the things you listed.

[–] ebiester 6 hours ago

So what happened with all of those with hardware wallets that have been pwned?

There apparently is no such thing as “your crypto” with how many security problems there are.

[–] caymanjim 6 hours ago

By the nature of blockchain, it's never, ever your crypto. It's allocated to whichever bucket the majority of participants in a given network agree to allocate it to.

[–] dlubarov 4 hours ago

Well, not exactly. A malicious majority of miners could rewind the chain as they please. They could indirectly steal some funds by undoing certain transfers, but they couldn’t just directly reassign funds to themselves.

[–] dididi27484sd 3 hours ago

Has anyone calculated the mining capacity of the AI data centre buildouts? Presumably the big firms could out-mine mining firms if they chose to?

[–] trevinhofmann 3 hours ago

Absolutely not, as GPUs used in data centers cannot compete with ASICs designed specifically for Bitcoin mining.

The Bitcoin mining network is somewhere around 1000 EH/s, while the (AI assisted research ahead) 34.5 million H100-equivalent GPUs globally would yield about 0.435 EH/s. They'd represent less than 0.05% of the Bitcoin network.

[–] ashkankiani 2 hours ago

That's only if they target Bitcoin and not some other coin which doesn't have an ASIC and has a GPU-friendly hash.

[–] 0c3ca83 3 hours ago

If they had built out the same number of ASICs and GPUs, what you said would make sense.

[–] weird-eye-issue 6 hours ago

Back around 2012 I created a paper wallet using an offline website (it was HTML and JS downloaded locally that worked without internet. I put it on a USB stick and then use it in a laptop without internet), printed it out and put it in a safe

[–] trollbridge 5 hours ago

I did a similar stunt with an old PowerBook where I electrically disabled the WiFi/Bluetooth so it wouldn’t be online unless I plugged in Ethernet, generated keys, and played around with mining. This was back in 2010 when this was all just basically toys for fun. I also encrypted it all with FileVault.

Then I forgot my pass phrase and have never been able to recover any of it. I don’t even know how many btc were mined/lost.

Before anyone asks, no, there aren’t any usable exploits / vulns found for the encryption methods used. And from what I can tell the coins in question have still sat frozen for going in a decade and a half now. I suspect many other hackers did the same thing…

[–] skinfaxi 5 hours ago

Apparently legacy filevault can be attacked offline with tools like john the ripper.

[–] weird-eye-issue 5 hours ago

If you were attempting to mine Bitcoin with a PowerBook I can confidently say you mined zero Bitcoin

Edit: I thought he was talking about 2012 but yeah in 2010 CPU mining was still a thing

[–] skinfaxi 5 hours ago

Wasn't the difficulty like 6 orders of magnitude easier back then?

[–] weird-eye-issue 5 hours ago

Okay maybe in 2010 you could use a CPU but even by 2012 it was entirely dominated by GPUs and I think even dedicated hardware was coming out around that time or soon after

[–] WarmWash 5 hours ago

ehhh you could CPU mine in the early months IIRC. The issue was that 50BTC wasn't even worth a penny back then lol

[–] rationalist 5 hours ago

Wasn't there an offline wallet that used a poor algorithm to develop seed phrases, and thus someone stole all of those coins a couple of months ago?

[–] weird-eye-issue 5 hours ago

Aren't you thinking of a hardware wallet?

[–] rationalist 5 hours ago

Yes

[–] weird-eye-issue 5 hours ago

That's why I went with a paper wallet it seemed way simpler which is what you want for something like this

[–] gnabgib 5 hours ago

Definitely Ledger Ledger confirms spy chip implant behind wallet crypto thefts (796 points, 18 days ago, 515 comments) https://news.ycombinator.com/item?id=50054092

Possibly Trezor (35 points, 16 days ago, 3 comments) https://news.ycombinator.com/item?id=50078423

[–] kalleboo 5 hours ago

He's thinking of Coldcard, which accidentally switched their RNG from the hardware RNG to a predictable PRNG https://www.cryptotimes.io/learn/what-is-coldcard-hack/

> Coldcard’s software is built on MicroPython, and Coinkite supplies its own hardware-RNG wrapper for the device’s STM32 chip. To avoid conflicts, Coinkite deliberately disabled MicroPython’s built-in RNG path by setting a configuration flag, MICROPY_HW_ENABLE_RNG, to zero. The problem: the underlying library checked only whether that flag was defined, not whether it was enabled (set to a non-zero value). Because a flag set to zero is still “defined,” the build silently compiled against the wrong code, and seed generation fell back to a deterministic software pseudo-random number generator called Yasmarang

[–] paulpauper 5 hours ago

bitaddresses .org? If the JS code was defective, the coins can still be stolen later if the hacker can recreate the keys by going through the small key space, despite the coins being created being offline.

[–] weird-eye-issue 5 hours ago

Ah yes that's the one, although the domain name isn't plural

[–] xmcp123 6 hours ago

I keep a modest amount in Cake Wallet, not on an exchange. No hardware needed.

Tbh the biggest problem is platforms deciding you’re buying drugs because you purchase and transfer out (thanks Venmo)

[–] extraextra 6 hours ago

Technically you can literally memorize your secret key

A paper wallet works as well

A hardware wallet is just a tradeoff between convenience and an extra security risk

[–] paulpauper 5 hours ago

insufficient entropy is the real problem. this is why coldcard was hacked

[–] NoidFonsense 6 hours ago

idk the whole point of hardware wallets is that they are supposed to be a simpler stack. But if you're using a closed source hardware wallet...

An old laptop with the wifi card taken out is more transparent and auditable. It just runs the ordinary open source code

But I just keep all my funds in a hot wallet, no multisig. And if I get hacked I lose it all. I think the answer is just have good security and dont get hacked. The risk of losing cryptocurrency will encourage security advances across the whole ecosystem. I think I will set up multisig eventually

[–] lxgr 6 hours ago

How do you update that open source code without network connectivity? How do you securely input long transaction data to sign?

> I think the answer is just have good security and dont get hacked.

So you proposed a way to be more secure, only to discard it yourself in favor of “just having good security”?

[–] trollbridge 5 hours ago

You don’t. It’s not networked. It doesn’t need updates.

In fact, updates are only a risk. You physically remove anything that can allow updates to happen + anything that allows wireless networking.

[–] georgeecollins 3 hours ago

How do you actually use funds like this? I mean, I know this is set aside for later. But if you had an emergency, how fast could you actually spend it?

[–] idiotsecant 1 hour ago

Trivially. You can simply read the keys on the offline machine with your eyeballs and set up a software or hardware wallet elsewhere to access the account.

[–] NoidFonsense 4 hours ago

USB flash or QR code to transfer data

I agree my approach is not great, I dont own a lot

[–] razodactyl 5 hours ago

I wonder if wallet is not a good or bad analogy considering it would make sense to have many wallets to distribute potential damage instead of being taken out in a single hit... UX issue?

[–] jwpapi 6 hours ago

You can have crypto without hardware wallets

[–] method_capital 7 hours ago

Code is law!

[–] razodactyl 5 hours ago

This is highly insensitive and highly logical. I am very conflicted.

[–] cryptoegorophy 7 hours ago

not your keys not your coins...

[–] pkulak 6 hours ago

Or if it is your key and your air-gapped hardware wallet gets hacked because someone didn't use the right RNG. Crypto is apparently never yours; you're just holding on to it for some future criminal or nation state.

[–] idiotsecant 1 hour ago

It's bizarre how this is the new thing everyone has to echo whenever they see a crypto thread.

You can store crypto with zero risk of electronic access just using offline wallet generation and an offline wallet. It's not even hard.

[–] cryptoegorophy 6 hours ago

hardware waller is NOT your key too. YOUR key is the paper wallet generated OFFLINE on a clean laptop that was never connected to web. There is a giant difference.

[–] rationalist 5 hours ago

Your method does not protect against what the person you replied to, posted.

If your paper wallet, generated offline, used a bad RNG, it is just as vulnerable.

[–] addaon 5 hours ago

> YOUR key is the paper wallet generated OFFLINE on a clean laptop that was never connected to web.

That sounds like your housekeeper's key...

[–] nkrisc 4 hours ago

Commit it to memory, the original kind.

[–] wlesieutre 3 hours ago

And then make sure to never have any memory loss or you’ll lose all your money too.

[–] skinfaxi 5 hours ago

If someone steals your wallet, it wasn't your money, just the free market working as intended.

[–] UltraSane 3 hours ago

Controlling your own crypto keys is like having your net worth in cash or gold stored in your house. It could easily be lost or stolen or destroyed in a fire unless you take extraordinary precautions and then it is all gone.

[–] idiotsecant 1 hour ago

It's not at all like storing gold, since you can have multisig wallets. You can make it arbitrarily difficult to lose or get stolen, depending on how thinly you want to slice your secrets and how many friends you have.

[–] UltraSane 45 minutes ago

"you can have multisig wallets"

This falls under "extraordinary measures" that few people do and is an enormous error prone hassle.