Cryptsy Bitcoin Trader Robbed, Blames Backdoor in the Code of a Wallet

Cryptsy, a website for trading Bitcoin, Litecoin, and other smaller crypto-currencies, announced a security incident, accusing the developer of Lucky7Coin of stealing 13,000 Bitcoin and 300,000 Litecoin, which at today’s rate stands more than $5.7 million / €5.2 million.

According to a blog post penned by the Cryptsy team, the incident took place on July 29, 2014, at 13:17:36, when funds started being moved from the company’s wallets to new locations.

After an internal investigation, the Cryptsy team concluded that the “the developer of Lucky7Coin had placed an IRC backdoor into the code of [a] wallet, which allowed it to act as a sort of a Trojan, or command and control unit.”

Lucky7Coin developer contacted Cryptsy before the robbery

Before this incident, on May 22, 2014, the Cryptsy team received an email from a man named Jack that informed the Bitcoin trader that he was taking over development of the Lucky7Coin (LK7) from its original creator.

Jack was begging the Bitcoin trader not to drop his newly-acquired crypto-currency and was informing the team of his good intentions, a new GitHub repository where the crypto-currency was being developed, along with a series of upgrades and changes he

Read more ... source: TheBitcoinNews