The crypto thread

[Moriarte]

Yeah, that's a blunder: don't build your Anarchy 2042 chain on top of Ethereum infrastructure.

Had they gone the way of Zcash and built proprietary blockchain, things could play out differently.

Infrastructural considerations go beyond cryptography. Then there is a question of using public information highways. Unless you own a satellite network, you aren't completely safe from interferences. Let's say you do own a satellite network. No problem, a dozen masked men descend on ropes and abduct programmer with laptop in charge of a satellite network. Satellite network down. No more FunCash. Then the question of points of contact with "classical economy" - banks, brokerages, side chains. These links can be severed, as you've pointed out. In the end, to not have their coin relegated to oblivion, one has to play by the rules of the surrounding economy. Well, maybe not all rules, but the most essential ones need to be upheld.

Cryptos are resilient up to a point. Even proof of work ones.

 

[Broken_Erika]

Colorado pastor accused of multimillion dollar crypto scheme​

A Colorado pastor and his wife have been charged with duping hundreds of local Christians in a multimillion dollar a cryptocurrency scheme.

Prosecutors accuse pastor Eli Regalado and his wife, Kaitlyn, of fraudulently raising over $3m (£2.4m) by selling "practically worthless" crypto.

The Regalados pocketed at least $1.3m in the alleged scheme between June 2022 and April 2023, prosecutors say.

Mr Regalado said his plan was inspired by God, according to court filings.

The pastor said that "God told him directly that investors would become wealthy" by investing into INDXcoin, a cryptocurrency created, marketed, and sold by the Regalados, according to the complaint.

INDXcoin was offered to Denver-area Christians through the Kingdom Wealth Exchange, an online cryptocurrency exchange owned and operated by the Regalados.

The couple "had no experience in cryptocurrency", the complaint said, and a third-party auditor found INDXcoin to be "unsafe, unsecure and riddled with technical problems".

"Despite that report, the Regalados allegedly continued to promote the INDXcoin as a low-risk, high-profit investment," it said.

"In reality, the INDXcoin was illiquid and practically worthless" and the couple used the funds for "their lavish lifestyle".

This included a Range Rover, luxury handbags, jewellery, boat rentals and snowmobile adventures, according to officials.

Colorado Securities Commissioner Tung Chan has filed civil fraud charges for violations of anti-fraud protections under the Colorado Securities Act.

She said her department was tipped off after multiple complaints by people who had invested in INDXcoin and had lost money.

Mr Relagado addressed the allegations in a video statement released on Friday.

"The reason that [Colorado] is saying that it's worthless is because there is no exit for people who have bought," he said, acknowledging that the cryptocurrency investors who have tried to withdraw funds have been unable to.

"We launched an exchange. The exchange technology failed. Things went down hill, and from that point forward, we've just been waiting on the Lord literally for a miracle."

On the allegation that Mr Relagado and his wife received $1.3m, the pastor said that was true.

"But out of that $1.3m, half of it went to the IRS and $200,000 went to a home remodel that the Lord told us to do," he said.

Many viewers left words of encouragement in the comments on the video, including "prayers going up" and "hang in there, stay strong".

The BBC has reached out to the Regalados for comment.

In the criminal complaint, Colorado prosecutors have asked for preliminary and injunctive relief, damages for investors and for a constructive trust to be placed on the Relagados' property.

They are scheduled to appear in Denver District Court next week.
https://www.bbc.com/news/world-us-canada-68072665

 

[Samson]

Effect of ETFs on Bitcoin price

 

[Samson]

A bunch of people are suing "Satoshi Nakamoto", though it really sounds like it is not him.

Case backed by Jack Dorsey seeks court ruling on bitcoin founder’s identity

An Australian computer scientist’s claim to be the mythical figure behind bitcoin will be challenged in the UK on Monday, in a high court case backed by the Twitter co-founder Jack Dorsey.

Craig Wright has asserted for years that he is the real Satoshi Nakamoto, the pseudonymous author of the 2008 white paper behind the world’s cornerstone cryptocurrency, but has failed to prove it.

You only get one side of the argument from the court filing, but it sounds pretty clear to me. This is assuming you cannot compile the LaTeX files to OpenOffice and then save to pdf from there, but they have probably thought of that and I do not know what pandoc could do in 2009.

Dr Wright’s main LaTeX file “main.tex”, “Candidate L”

This file is a LaTeX source file, taken from a folder on Dr Wright’s Overleaf account. Dr Wright has stated that, as Satoshi Nakamoto, he wrote the Bitcoin White Paper using LaTeX. He has also stated that this document “uniquely codes for the Bitcoin White Paper”, and that when compiled in Overleaf, produce a copy of the Bitcoin White Paper “in the same form as” and “materially identical to” that published by Satoshi Nakamoto.

Reasons for Allegation of Forgery

The Bitcoin White Paper was not written in LaTeX. It was written and produced in OpenOffice 2.4.

The encoding and embedding of fonts within the original Bitcoin White Paper, and their kerning, is fundamentally incompatible with LaTeX, especially LaTeX in 2009.

Dr Wright’s selected LaTeX file does not, when compiled, produce the Bitcoin White Paper (and neither does any other file in the TC folder).

Dr Wright’s LaTeX files from the TC folder are not original to 2008 or 2009. Using LaTeX software that is up to date for 2009, none of them compiles properly, instead producing errors and warnings.

The images that result from compiling Dr Wright’s identified file are different from the images in the original Bitcoin White Paper

 

[RobAnybody]

From 12/5/23:

I've been updating prices every 3 (or 6 last post) months, but something weird is going on. That /\ post was 11/17. As of today, 12/5: Bitcoin: $43,773.62; Etherium: $2,281.48.

Anyone got any explanations? As in, 'this is dumb, ignore it (most likely)'; or, 'this [poop] is randomly skyrocketing again, so get in for no good reason'? Or better yet [some logical explanation].

Everything is going up, even SHIBA (my "screw you guys I'm going home" plan if it ever really takes off ).

Just popping in to update prices. I still have *no* idea what's going on, although I'm (financially) enjoying it. Always looking for insight on this this if anyone understands this chaos, but it still seems like "just... I dunno... go with it"?

Bitcoin: $72,204.77
Etherium: $4,052.83
Doge: $0.18
Shiba: $0.00034

Doge is making a bit of a rebound after "making random people tons of $$$" then tanking. Shiba is slower, but similar. *But*... Bitcoin & Etherium are back to "if you went all in & kept it, you are now rich!" levels. I'm not one of those, just pointing it out.

If you bought Bitcoin 1 year ago when it was $25,117, or even as of my quoted December post when it was $43,774, you'd be doing quite well (you can buy fractions of a "coin"; don't need to buy a "whole coin" if you're wondering). As always, I have no idea what any of this means, or why it's happening. I just like to watch my Beanie Babies (Etherium & Shiba in this case) & occasionally post updates about them, in hopes that someone will explain what's happening.

 

[innonimatu]

From 12/5/23:

Just popping in to update prices. I still have *no* idea what's going on, although I'm (financially) enjoying it. Always looking for insight on this this if anyone understands this chaos, but it still seems like "just... I dunno... go with it"?

Bitcoin: $72,204.77
Etherium: $4,052.83
Doge: $0.18
Shiba: $0.00034

Doge is making a bit of a rebound after "making random people tons of $$$" then tanking. Shiba is slower, but similar. *But*... Bitcoin & Etherium are back to "if you went all in & kept it, you are now rich!" levels. I'm not one of those, just pointing it out.

If you bought Bitcoin 1 year ago when it was $25,117, or even as of my quoted December post when it was $43,774, you'd be doing quite well (you can buy fractions of a "coin"; don't need to buy a "whole coin" if you're wondering). As always, I have no idea what any of this means, or why it's happening. I just like to watch my Beanie Babies (Etherium & Shiba in this case) & occasionally post updates about them, in hopes that someone will explain what's happening.

Financial speculation is not rational. Do not lose your time trying to undestand it. Its a game of people manipulating, and trying to anticipate the manipulatios of, other people. A huge waste of human energy in a useles activity for humanity.

 

[Comrade Ceasefire]

Breaking news: High Court rules Craig Wright is not Satoshi Nakamoto.
NFTs at six.

 

[Aiken_Drumn]

I did dabble in GME and doubled my money in a week..

Tried again today and lost £1000 within a few hours and ran away scared!

 

[Samson]

Welcome to the new world, just like the old world

US convicts crypto-robbing gang leader who kidnapped victims before draining their accounts

The US has convicted the 24-year-old leader of an international robbery crew that kidnapped and terrorized wealthy victims during home invasions that were carried out to steal cryptocurrency tokens.

The court heard that Remy St Felix, of West Palm Beach, led the gang between September 2022 and July 2023, during which time and across several extremely violent home invasions they stole hundreds of millions of dollars worth of crypto from victims.

According to evidence presented at trial, on one occasion in April 2023, St Felix and one other crew member assaulted, restrained with zip-ties, and held an elderly husband and wife at gunpoint, threatening additional violence to them, while other members remotely drained their cryptocurrency wallet of more than $150,000.

The brutal attack was carried out on Wells Street in Durham, North Carolina, at around 0900 local time, the complaint claims. St Felix and another crew member were said to have dressed as construction workers, adorned with reflective vests and khaki trousers, claiming to be inspecting pipes for damage.

After patrolling the perimeter of the house, with the husband and wife's permission, they again knocked on their door, barged their way into the home and past the wife, who was dragged by the legs into the bathroom where she was restrained by St Felix's masked accomplice, according to the filing.

The husband ran to her rescue but was also overpowered by St Felix, zip-tied, and forced to log into the home iMac to install AnyDesk's remote access software, the document claims.

Over the next 45 minutes, St Felix spoke to a third crew member over speakerphone who was tasked with draining $156,853 worth of cryptocurrency from the husband's Coinbase account over three transactions. The criminals attempted a fourth transaction, which was blocked by Coinbase.

 

[RobAnybody]

Bitcoin: $36,409; Etherium: $1953

As of today, 12/5: Bitcoin: $43,773.62; Etherium: $2,281.48.

Bitcoin: $72,204.77
Etherium: $4,052.83
Doge: $0.18
Shiba: $0.00034

Today (7/26/24):
Bitcoin: $67,828.88
Etherium: $3,257.22
Doge: $0.13
Shiba: $0.000017

I (as usual) have no idea what to do with this information - everything's down from my last update. But I felt like including the older posts just to show that even while down, it's way up from that 11/23 post. Beanies gonna Beanie I guess.

EDIT: inserted the date into my current post, for future posts like this

 

[Samson]

Crypto-apocalypse soon? Chinese researchers find a potential quantum attack on classical encryption

Chinese researchers claim they have found a way to use D-Wave's quantum annealing systems to develop a promising attack on classical encryption.

Outlined in a paper [PDF] titled "Quantum Annealing Public Key Cryptographic Attack Algorithm Based on D-Wave Advantage", published in the late September edition of Chinese Journal of Computers, the researchers assert that D-Wave’s machines can optimize problem-solving in ways that make it possible to devise an attack on public key cryptography.

The paper opens with an English-language abstract but most of the paper is in Chinese, so we used machine translation and referred to the South China Morning Post report on the paper – their Mandarin may be better than Google's ability to translate deeply technical text.

Between the Post, the English summary, and Google, The Reg understands the research team, led by Wang Chao from Shanghai University, used a D-Wave machine to attack Substitution-Permutation Network (SPN) structured algorithms that perform a series of mathematical operations to encrypt info. SPN techniques are at the heart of the Advanced Encryption Standard (AES) – one of the most widely used encryption standards.

The tech targeted in the attack include the Present and Rectangle algorithms, and the Gift-64 block cipher, and per the Post produced results that the authors presented as “the first time that a real quantum computer has posed a real and substantial threat to multiple full-scale SPN structured algorithms in use today.”

The researchers argue that the approach they developed can be applied to other public-key and symmetric cryptographic systems.

The exact method outlined in the report does remain elusive, and the authors declined to speak with the Post due to the implications of their work.

But the mere fact that an off-the-shelf one quantum system has been used to develop a viable angle of attack on classical encryption will advance debate about the need to revisit the way we protect data.

It’s already widely assumed that quantum computers will one day possess the power to easily decrypt data enciphered with today’s tech, although opinion varies on when it will happen.

Adi Shamir – the cryptographer whose surname is the S in RSA – has predicted such events won’t happen for another 30 years despite researchers, including those from China, periodically making great strides.

Other entities, like Singapore’s central bank have warned that the risk will materialize in the next ten years.

Vendors, meanwhile, are already introducing “quantum safe” encryption that can apparently survive future attacks.

That approach may not be effective if, as alleged, China is stealing data now to decrypt it once quantum computers can do the job.

Or perhaps no nation needs quantum decryption, given Microsoft’s confession that it exposed a golden cryptographic key in a data dump caused by a software crash, leading a Chinese crew to obtain it and put it to work peering into US government emails.

 

[warpus]

1. From what I read these Chinese researchers haven't actually compromised anything, they are simply continuing their work on that. The problems will begin once they are actually successful, and those problems will reach far beyond cryptocurrencies and be a much bigger headache.

2. There are quantum computing proof algorithms & blockchains in existence already, from what I understand. It would of course take a long time for other blockchains to adapt their algorithms to be quantum computing proof, and that would be a problem, but it does seem that algorithms exist that would allow you to keep the blockchain secure from a quantum computer attack.

 

[Samson]

2. There are quantum computing proof algorithms & blockchains in existence already, from what I understand.

NIST has published some algorithms, but are you using them? Are you happy with what you encrypt now being public knowledge in a few years?

the blockchain secure from a quantum computer attack.

There is no "the" blockchain. There are multiple blockchains, and all the ones (commonly used at least) now are vunerable.

 

[warpus]

NIST has published some algorithms, but are you using them? Are you happy with what you encrypt now being public knowledge in a few years?

I'll deal with it once it becomes clear that quantum computing being able to easily compromise currently secure encryption schemes is on the horizon. That doesn't seem to be the case yet.

 

[Samson]

So the FTX victims are getting their money back after all!!

• FTX to repay 98% of customers within 60 days of effective date
• Customers to receive at least 118% of account value as of Nov 2022
• Mixed customer response due to missed crypto price rebound

NEW YORK, Oct 7 (Reuters) - FTX received court approval of its bankruptcy plan on Monday, which will allow it to fully repay customers using up to $16.5 billion in assets recovered since the once-leading crypto exchange collapsed.
U.S. Bankruptcy Judge John Dorsey approved the wind-down plan at a court hearing in Wilmington, Delaware, saying FTX's success made it "a model case for how to deal with a very complex Chapter 11 bankruptcy proceeding."

The plan is built on a series of settlements with FTX customers and creditors, U.S. government agencies, and liquidators appointed to wind down FTX's operations outside the U.S.

The settlements allow FTX to use its assets to repay customers of its crypto exchange first, before paying potentially competing claims filed by government regulators. FTX plans to repay 98% of its customers - those who held $50,000 or less on the exchange - within 60 days after the plan's effective date, which has not yet been determined.

Once among the world's top crypto exchanges, FTX collapsed after news surfaced that founder Sam Bankman-Fried took customer money to pay off risky bets made by his hedge fund, Alameda Research. Bankman-Fried was sentenced in March to 25 years in prison for stealing from FTX customers, and he has appealed his conviction.
FTX remains in talks with the U.S. Department of Justice over $1 billion that the government seized during the criminal prosecution of Bankman-Fried. FTX shareholders, who would normally receive nothing in a bankruptcy proceeding, could receive up to $230 million from the funds seized by the DOJ, according to court documents.

FTX has estimated that it will have between $14.7 billion and $16.5 billion available to repay creditors, enough to pay customers at least 118% of the value in their accounts as of November 2022, the date that the company filed for bankruptcy.

 

[Birdjaguar]

They Cracked the Code to a Locked USB Drive Worth $235 Million in Bitcoin. Then It Got Weird​

Stefan Thomas lost the password to an encrypted USB drive holding 7,002 bitcoins. One team of hackers believes they can unlock it—if they can get Thomas to let them.

At 9:30 am on a Wednesday in late September, a hacker who asked to be called Tom Smith sent me a nonsensical text message: “query voltage recurrence.”

Those three words were proof of a remarkable feat—and potentially an extremely valuable one. A few days earlier, I had randomly generated those terms, set them as the passphrase on a certain model of encrypted USB thumb drive known as an IronKey S200, and shipped the drive across the country to Smith and his teammates in the Seattle lab of a startup called Unciphered.

[/URL]
Unciphered’s staff in the company’s Seattle lab.
Photograph: Meron Menghistab


Smith had told me that guessing my passphrase might take several days. Guessing it at all, in fact, should have been impossible: IronKeys are designed to permanently erase their contents if someone tries just 10 incorrect password guesses. But Unciphered's hackers had developed a secret IronKey password-cracking technique—one that they've still declined to fully describe to me or anyone else outside their company—that gave them essentially infinite tries. My USB stick had reached Unciphered’s lab on Tuesday, and I was somewhat surprised to see my three-word passphrase texted back to me the very next morning. With the help of a high-performance computer, Smith told me, the process had taken only 200 trillion tries.

The whole story is here:

They Cracked the Code to a Locked USB Drive Worth $235 Million in Bitcoin. Then It Got Weird

Stefan Thomas lost the password to an encrypted USB drive holding 7,002 bitcoins. One team of hackers believes they can unlock it—if they can get Thomas to let them.

www.wired.com

 

[Aiken_Drumn]

They Cracked the Code to a Locked USB Drive Worth $235 Million in Bitcoin. Then It Got Weird​

Stefan Thomas lost the password to an encrypted USB drive holding 7,002 bitcoins. One team of hackers believes they can unlock it—if they can get Thomas to let them.

At 9:30 am on a Wednesday in late September, a hacker who asked to be called Tom Smith sent me a nonsensical text message: “query voltage recurrence.”

Those three words were proof of a remarkable feat—and potentially an extremely valuable one. A few days earlier, I had randomly generated those terms, set them as the passphrase on a certain model of encrypted USB thumb drive known as an IronKey S200, and shipped the drive across the country to Smith and his teammates in the Seattle lab of a startup called Unciphered.

']https://media.wired.com/photos/6536d520e87b8bc357995e73/master/w_1600,c_limit/WIRED_10_17_23_2-edit.jpg[/IMG][/URL]
Unciphered’s staff in the company’s Seattle lab.
Photograph: Meron Menghistab


Smith had told me that guessing my passphrase might take several days. Guessing it at all, in fact, should have been impossible: IronKeys are designed to permanently erase their contents if someone tries just 10 incorrect password guesses. But Unciphered's hackers had developed a secret IronKey password-cracking technique—one that they've still declined to fully describe to me or anyone else outside their company—that gave them essentially infinite tries. My USB stick had reached Unciphered’s lab on Tuesday, and I was somewhat surprised to see my three-word passphrase texted back to me the very next morning. With the help of a high-performance computer, Smith told me, the process had taken only 200 trillion tries.

The whole story is here:

They Cracked the Code to a Locked USB Drive Worth $235 Million in Bitcoin. Then It Got Weird

Stefan Thomas lost the password to an encrypted USB drive holding 7,002 bitcoins. One team of hackers believes they can unlock it—if they can get Thomas to let them.

www.wired.com

What about this was weird? That hackers, hacked, quickly?

 

[Birdjaguar]

What about this was weird? That hackers, hacked, quickly?

I think this part might be the weird part:

The only problem: Thomas doesn't seem to want their help.

Earlier this month, not long after performing their USB-decrypting demonstration for me, Unciphered reached out to Thomas through a mutual associate who could vouch for the company’s new IronKey-unlocking abilities and offer assistance. The call didn't even get as far as discussing Unciphered's commission or fee before Thomas politely declined.

Thomas had already made a “handshake deal” with two other cracking teams a year earlier, he explained. In an effort to prevent the two teams from competing, he had offered each a portion of the proceeds if either one could unlock the drive. And he remains committed, even a year later, to giving those teams more time to work on the problem before he brings in anyone else—even though neither of the teams has shown any sign of pulling off the decryption trick that Unciphered has already accomplished.

That has left Unciphered in a strange situation: It holds what is potentially one of the most valuable lockpicking tools in the cryptocurrency world, but with no lock to pick. “We cracked the IronKey,” says Nick Fedoroff, Unciphered's director of operations. “Now we have to crack Stefan. This is turning out to be the hardest part.”

Or it is just a clickbait headline.

 

[Aiken_Drumn]

Ah, I remeber reading about this back when he got the two separate groups working to solve the problem.

I guess I do respect his stance.. But surely just pay the new guys and cover the 'losers' expenses if you're morally conflicted?

 

[Samson]

‘Getting paid to review is justice’: journal pays peer reviewers in cryptocurrency

An experimental journal is paying peer reviewers the equivalent of US$150 per review in a specially developed cryptocurrency. The publication is hosted on a platform aiming to make science more open and efficient, and rewards users with a token called ResearchCoin for engaging with content.

The platform, called ResearchHub, launched in 2020 and is backed by billionaire entrepreneur Brian Armstrong, who developed Coinbase, the largest cryptocurrency exchange in the United States.

“It’s a strange oddity of history that peer reviewers don’t get paid. It’s a valuable thing that they do and we should recognize, reward it,” Armstrong said last month at the launch of the ResearchHub Journal in San Francisco, California. The move comes as Bitcoin — the world’s most established cryptocurrency — reached an all-time-high value of US$100,000, fuelling renewed fervour for the notoriously volatile sector.

Experts say ResearchHub addresses some of the issues in science but might struggle to gain a foothold in research publishing because of its radical nature.

Spoiler Rest of article :

Open-source science

Armstrong first floated the idea for ResearchHub in a 2019 blogpost in which he expressed frustration at the speed and quality of scientific research. He suggested that science should operate in a similar way to open-source software, where users build on each others work, with elements of successful online platforms such as social-media site Reddit, the code repository GitHub and crowd-funding website Kickstarter. As part of his plan, he wanted to provide a viable alternative to conventional journals.

The ResearchHub Journal promises that preprints uploaded to the site will be peer reviewed within 14 days and a publication decision will be made in seven days after that. Authors pay a $1,000 article-processing charge (APC), and papers and the accompanying peer reviews are published under a liberal CC-BY licence. The journal is yet to publish a paper and is not indexed on bibliometric databases such as Web of Science or Scopus.

Authors can also earn ResearchCoin as a reward for using good research practices, such as preregistering studies and sharing data openly. Users of ResearchHub can already earn ResearchCoin for uploading preprints and papers to the site, commenting on or voting for these uploads. Users can also tip each other for good work or pay others to complete research-related tasks, such as generating data for a review. Currently, ResearchHub takes a 7% cut of any ResearchCoin transactions on the site, 2% of which is ploughed back into the community.

Alex Holcombe, a metascientist and psychologist at the University of Sydney, Australia, likes the idea of experimenting with the credit economy of science. “Currently, we just get credit for publishing papers, but there is so much more to science, including great forms of evaluation, such as peer review,” he says.

But he cautions that most radical initiatives in science publishing fail. “It’s so hard to break out of the tyranny of impact factors,” he says.

Cash or credit

Paying researchers for peer review is not a new idea. Economics journals have done it in the past, and some medical journals pay certain reviewers. PeerJ, an open-access mega-journal launched in 2012, uses a token system to reward reviewers. Reviewers earn ten tokens for reviewing an article; these can be redeemed against the APCs for publishing in PeerJ. The website says that “tokens are fair, flexible and the future of peer review”.

Some researchers are finding that reviewing for ResearchHub is lucrative. Although the site launched its journal only last month, it has been paying referees to review uploaded preprints since May 2023.

Pedro Paulo Gattai Gomes, an independent molecular-biology consultant in São Paulo, Brazil, says that he now earns more money reviewing for ResearchHub than he did in his professorial roles at academic institutions. He reviews an average of 15 papers a month, accounting for 70% of his income.

“Getting paid to review is justice, because in my opinion it is very unfair to work voluntarily and not even receive a thank you,” he says.

Cashing in ResearchCoin for ordinary money is possible but complicated. The ‘decentralized’ cryptocurrency exchange Uniswap allows ResearchCoin to be traded for other cryptocurrencies, such as Bitcoin, Ethereum or USD Coin, which can be converted into some conventional currencies. ResearchCoin is currently trading at around $1. ResearchHub co-founder Patrick Joyce says that his team is in talks to get ResearchCoin listed on a centralized exchange that is more straightforward to access.

James Butcher, a publishing consultant in Liverpool, UK, says that the use of a cryptocurrency could make it difficult for the site to gain traction, because these systems have been exploited by scammers. “Academics are a conservative group of people,” he says.