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Bitcoin Core Developer Loses More Than $3 Million to a Hack

  • Crypto users are concerned that a Bitcoin Core developer known for being security conscious could be hacked.
  • Some security experts believe Luke Dashjr could have made mistakes that led to his account being compromised.
  • Changpeng Zhao offered to help monitor the situation and freeze the Bitcoin if it is deposited on Binance.

A Bitcoin developer took to Twitter to announce that his account had been attacked and drained by a hacker, raising fresh questions about security. Luke Dashjr, who claims to be one of the earliest Bitcoin Core developers, said the attack took place on New Year’s Eve.

While the total of the stolen funds is yet to be ascertained, Dashjr said he tracked some of it to a wallet address that received around 217 BTC ($3.6 million). Dashjr said the hack was caused by his compromised pretty good privacy (PGP) key, adding that the attacker’s IP was from a ColoCrossing server.

Bitcoin Core developers are known for being security conscious, but Dashjr said he had no clue how his cold wallet was hacked, adding that he last used it in September. Some Twitter users mentioned a security breach Dashjr tweeted about in November as a possible reason for the hack. However, Dashjr said he believes “everything is compromised,” including his Twitter. The Bitcoin Core developer also advised his followers against using Bitcoin Knots, a Bitcoin wallet signed by his hacked PGP key.

Binance CEO Changpeng Zhao reacted to Dashjr’s Twitter post, offering to assist the developer in any way the exchange could. Zhao further pledged that their security team will keep an eye on the assets and freeze the Bitcoin if it gets onto Binance.

Zhao, who has been a strong critic of self-custody wallets, took the moment to reaffirm his criticism, writing in a post,

Sad to see even an OG #Bitcoin Core Developer lost 200+ BTC ($3.5 million). Self custody have a different set of risks. We will try to monitor and see where we can help

In November, Zhao said self-custody could have costly mistakes, adding that the community should take care to implement it properly. Self-custody wallets give users full control of their wallets, making them act as bankers. However, users have to bear the full responsibility of securing their wallets. So, if they lose their seed phrase, they will lose their funds and account. 

Lawrence Woriji Verified

Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.

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