A BITCOIN gold rush is on as hackers attempt to crack into dormant wallets estimated to contain some $140BILLION worth of crypto.
Experts estimate 20 per cent of all cryptocurrency has either been forgotten about or lost – and could be up for grabs for industrious cyber criminals who view breaking into the online wallets as a very lucrative challenge.
Crypto data firm Chainalysis believe some one fifth of all Bitcoin in existence has now either been lost or forgotten – some of it believed to be impossible to access – with a current value of around $140billion.
But wallets which were stored online rather than on hardware are sparking the interest of potential hackers who may attempt to break in and scoop out the forgotten coins.
High value wallets are sometimes passed around online hacking communities as they challenge each other to open them up to get at the hidden treasure inside.
Hackers and scammers are believed to steal around $10million worth of cryptocurrency every single day, according to Atlas VPN.
Alon Gal, co-founder of cybercrime intelligence firm Hudson Rock, told The Sun Online that dormant Bitcoin accounts are targeted “very often” by hackers.
“Hackers have access to early Bitcoin adopters’ personal information originating from leaked databases such as the famous Bitcointalk database leak,” he said.
“These early adopters are then targeted for their wallets by these opportunistic hackers aiming to find old wallets containing large amount of Bitcoins.
“Sometimes these hackers are able to find wallets even the owners forgot about by bruteforcing storage services (i.e Dropbox) that the early adopters may have even forgotten they uploaded their Bitcoin wallets into years ago.”
The lure of dormant Bitcoin wallets will always remain an attractive prospect for cybercriminals due to the considerable payout if they are successful
Digital Shadows Photon Research Team
Mr Gal last year found a high value wallet being traded amongst hacking forums which was thought to hold some $690million worth of Bitcoin.
However, this account was later seized by the US government after it was found to contain stolen Bitcoin connected to dark web marketplace Silk Road.
Bitcoin is a completely open currency, meaning the contents of wallets and the transactions can be viewed by anyone who has the correct ID.
And this means that so-called dormant wallets – accounts which have had no out transactions for a number of years – could be a gold mine.
The largest dormant account is worth $3billion – according to BitInfoCharts – and there are two other static wallets with sums over $1billion.
Numerous other accounts have sums in the hundreds of millions – with many of them not touched for the best part of a decade.
Small sums of Bitcoin sometimes get sent to these accounts – but they remain unmoving, either forgotten, locked or simply hoarding the coins.
Many of these mammoth wallets were set up in 2010 or 2011 – the early days of Bitcoin – and have never been used to make a transaction, or haven’t made transactions for many years.
These early adopters are then targeted for their wallets by these opportunistic hackers aiming to find old wallets containing large amount of Bitcoins
The crypto can be considered lost if investors lose their passwords – or early backers of the coin may simply have forgotten they had picked it up.
Bitcoin can also be left inaccessible if the holder dies and doesn’t leave behind their information.
The largest dormant wallet – which has not made any out transactions in its lifetime, and was originally set up with $74,363 worth of the coin in 2011.
A spokesperson from Digital Shadows Photon Research Team told The Sun Online: “The lure of dormant Bitcoin wallets will always remain an attractive prospect for cybercriminals due to the considerable payout if they are successful.
“Armed with the appropriate infrastructure and resources, cybercriminals are likely to target accounts with large funds which seemingly remain unused.”
What is Bitcoin?
Bitcoin is a virtual currency that was created in 2009 by an unknown computer whizz using the alias Satoshi Nakamoto.
Unlike physical currencies such as pounds, dollars or euros, which come in physical notes and coins, Bitcoin isn’t printed or minted.
Instead, Bitcoin tokens are a digital-only form of payment and are created by a computer code.
The value of Bitcoin is determined by how much people are willing to exchange it for and its price has fluctuated wildly since it was introduced.
It’s currently valued at around $38,132.
Last year, the currency was around the $23,000 mark – but in April this year it reached record highs of above $62,000 at the beginning of April.
Since then, it has seen regular slumps – eventually dropping to its current price.
Some of the biggest falls came when Elon Musk withdrew his support and Beijing announced its ban.
They added: “Attempting to attack a dormant wallet by bruteforcing the password for a crypto wallet is likely to take considerable resources so it is not out of the realm of possibility that cybercriminals will pool resources to actively target selected wallets.
“With the amount of money that likely remains ‘lost’ to the growing world of cryptocurrency, the target on those accounts will only increase.
“With cryptocurrency being able to achieve high valuation in short and volatile periods, it is also realistically possible that cybercriminals will continue to targets these unattended wallets in hopes of acquiring access and scoring a big payout.”
HAVE YOU TRIED PASSWORD?
And there have been plenty of high profile cases where traders have found themselves unable to access their millions.
Bitcoin trader Stefan Thomas has admitted losing access to more than $265million worth of Bitcoin as he forgot his password – saying the blunder left him feeling like a “complete idiot”.
He realised he lost the password around 10 years ago when the coins were worth around £100,000 – and he has been left helplessly watching from the sidelines as his missing fortune swelled by almost 19,900 per cent.
He believes it is stored on a drive that locks itself after ten failed attempts to remember the password, with Thomas already trying eight times – meaning he has just two left to try and unlock his riches.
And meanwhile there is the high profile case of James Howells, who lost more than $300million worth of Bitcoin after he tossed out his hard drive.
The 35-year-old still hopes to one day recover his coins and has appealed to Newport City Council to allow him to search the tip.
However, with his coin stored in a physical device that could be buried beneath tons upon tons of rubbish – his fortune could be one of the Bitcoin stashes that is truly lost forever.
It comes after we told the story of two Bitcoin trader brothers who vanished with £2.5billion worth of stolen crypto.