Bitcoin

Pennsylvania Man Confesses to $40 Million Bitcoin Theft

Darryn Pollock | Jul 20, 2017 | 12:21

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Confronted by police on allegations of selling stolen laptops, a Pennsylvania man has also come clean and confessed to apparently stealing over $40 million worth of Bitcoin through a malware program.

An alleged heist of millions of dollars worth of Bitcoin has come to light in the most peculiar fashion as a Pennsylvania man admitted to officers that he had written software that stole Bitcoin by replacing wallet addresses with his own.

Theodore Price was under investigation on unrelated matters after his girlfriend discovered laptop bags that had gone missing from her parents’ house in his possession. The Hatfield resident had sold one of the laptops for $150 dollars, while sitting on around $40 million, leading to his downfall before he could flee the country.

How to Launder $40 million

Price’s confession, if true, is one of the few hacks in Bitcoin’s history that has led to the perpetrator being pinned for the theft. Due to the anonymous nature of Bitcoin, the thieves – or hackers – are usually never found.

Price admits that when he was approached by police, he was in the throes of trying to flee the country for England, hoping to charter a private jet and leave under the name Jeremy Renner, the name of the actor who plays Hawkeye in The Avengers movie franchise.

He hit a brick wall in terms of cash flow, however, since even though Bitcoin is anonymous, it is also transparent. This transparency means that he would have been unable to move such large amounts of the digital currency without alerting suspicion.

Most hackers use a process of laundering Bitcoin called “tumbling” which intermingles one person’s transactions with that of other people.

Bitcoin Theft One of the Biggest To Date

If verified, the Bitcoin theft would rank within the top five in terms of sheer value, according to Cornell University computer science professor Emin Gun Sirer.

“It’s fascinating,” Sirer said, noting virtual currencies are a favorite target for hackers because they’re valuable, their security is relatively weak and they’re unregulated. “This is one of the first cases where the person behind the malware has been located.”

Currently at the top of the pile in terms of Bitcoin theft is the Mt.Gox hack which saw more than 10 times this amount stolen, however, the perpetrators have yet to be caught or even discovered.

Bitcoin Wallet Malware

Price explained to officers, including a Homeland Security officer, how he wrote software that simulates the code used to create Bitcoin wallets. From there he would distribute the software via specific forums, injecting it into people’s email addresses. The software steals Bitcoin keys by replacing other people’s wallets with Price’s wallets during transactions.

Price was charged last week with unauthorized access to a computer to commit a federal crime for personal financial gain. The value of the stolen Bitcoin is etimated to be between $40 million and $50 million.

Despite Price’s confession, the unauthorized access charge has been withdrawn. Assistant U.S. Attorney Lesley Bonney confirmed the withdrawal but would not comment on why Price would not be charged directly with the Bitcoin theft he admitted to.

Does the ease in which people seem to be able to steal Bitcoin put you off investing in it? Does this kind of news damage the digital currencies reputation? Let us know your thoughts in the comments below!

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