The list of bitcoin thefts is far too long. Over the past, almost, eight years, we can roughly estimate $1 billion or more have been stolen. Each time, there is devastation for the individuals involved and the wider community as bitcoin’s security is brought to the forefront. This is followed by a backlash from the wider media and public who have been keen to disparage bitcoin ever since the first major hack in 2011 when many dismissed it as insecure. But, is there a solution or are we forever to live with these far too frequent theft stories?
For bitcoin to function and have any value it needs to be traded and moved from a to b. That means it needs hot wallets. So-called hot because they are available to anyone with skill. In bitcoin’s case, the talent pool is the entire world. Sooner or later, therefore, the wallet will be stolen.
Most exchanges now do not even announce these hot wallet thefts, considering them as a cost of business. However, that leaves them vulnerable to insolvency or,