back to article Crypto outfit Qubit appeals to the honour of thieves who lifted $80M of its digi-dollars

Another week, another crypto upstart admitting its lax security has been exploited and parties unknown have made off with millions. But this time there's a twist: the crypto upstart has appealed for the return of its assets by appealing to the thieves' consciences. The crypto concern is Qubit Finance – an outfit that offers …

  1. Anonymous Coward
    Anonymous Coward

    They'll soon get bored with all this

    and move into Umbrella companies instead.

    1. Andy The Hat Silver badge
      Coat

      Re: They'll soon get bored with all this

      What, zombie companies?

      Coat already off the hook ... :-)

  2. Anonymous Coward
    Anonymous Coward

    As someone who understand blockchain ...

    and has spent years advising people against "investing" in them I have zero sympathy.

    1. tony72

      Re: As someone who understand blockchain ...

      Given historical returns of bitcoin (nobody has ever lost money if they held bitcoin for four years or more, even if they bought in at at an all-time high price) compared to the performance of cash, stocks, and gold in recent years, if you actually understand blockchain and cryptocurrencies, how do you justify not having a portion of your portfolio as bitcoin?

      And in light of the fact that the likes of Tesla, Square, Microstrategy, JP Morgan and a whole long list of institutions with very high-powered economists at their disposal are heavily invested in bitcoin, perhaps you could share some insight as to why you're qualified to know better than them?

      1. iron

        Re: As someone who understand blockchain ...

        > how do you justify not having a portion of your portfolio as bitcoin?

        Because I don't want my meagre wealth to be gained at the cost of destroying the planet faster. Because I don't want some of it to have come from theft, extorsion, ransomware, money laundering, people trafficking or any of the other things that Bitcoin is mostly used for.

        My qualifications for knowing better than Tesla, Square, Microstrategy and JP Morgan is I'm a human being, not a cold blooded lizard.

        1. tony72

          Re: As someone who understand blockchain ...

          Because I don't want my meagre wealth to be gained at the cost of destroying the planet faster.

          A worthy sentiment. However the issue of cryptocurrency energy use is basically a solved problem. Ethereum, the second biggest blockchain after bitcoin, is in the process of shifting to a proof-of-stake model that requires no energy-intensive mining. Bitcoin itself could theoretically switch to proof-of-stake, but likely won't, however as its dominance continues to fall over time, that becomes less of an issue - it will probably be overtaken by Ethereum eventually. In any case, lower-power miners are becoming available (Intel just released one, they know where it's at). And mining is increasing done in environmentally-friendly ways. For example gas that was uneconomic to recover and was previously flared off is being used to mine bitcoin in several places actually reducing the carbon footprint.

          Because I don't want some of it to have come from theft, extorsion, ransomware, money laundering, people trafficking or any of the other things that Bitcoin is mostly used for.

          Again, a fine sentiment, however based on a common misconception. The proportion of cryptocurrency connected to crime is actually less than the proportion of global GDP connected to crime. So if anything, that's a reason to start using crypto, rather than to avoid it.

          1. Matt Palmer

            Re: As someone who understand blockchain ...

            Given that research indicates a very high proportion of trades on exchanges are wash trades (around 70%), the actual proportion of criminal to non criminal activity in terms of trade volume is *much* higher.

          2. Alex Stuart

            Re: As someone who understand blockchain ...

            > In any case, lower-power miners are becoming available (Intel just released one, they know where it's at).

            This just means more will be mined for the same amount of power. Proof of work systems will always expand to use as much energy as possible while remaining profitable.

            Anyway - the elephant in the room.

            Why?

            I have yet to be given a single convincing (and legal) use case for cryptocurrencies. People harp on about decentralisation, but my very much centralised bank allows me to make an instant (for all intents and purposes) NFC payment on the other side of the world with 0% FX fee, upto £85k government protected savings, and fraud protection. It seems like a classic case of a solution to problems that don't, or barely, exist.

          3. Anonymous Coward
            Anonymous Coward

            Re: As someone who understand blockchain ...

            Yes, well, no amount of whinging will change my mind about not wanting to support the black market.

            Crypto is a Ponzi scheme, and anyone who claims otherwise is hoping to take you for a ride...

            1. EnviableOne

              Re: As someone who understand blockchain ...

              Fiat currencies are a Ponzy scheme, they are only worth what you allow them to be.

              The USD and GBP, along with BTC, ETH et. all are Fiat currencies

              The pound left the gold standard in 1931 followed by the dollar in 1971 since then they have been fiat currencies

              1. Anonymous Coward
                Anonymous Coward

                Re: As someone who understand blockchain ...

                One of the clearest signs that somebody has no idea what they are doing in crypto is when they refer to fiat currencies as if that were a killing blow.

                Maybe you should not be speculating in crypto when you don't even understand why traditional currencies have value?

      2. Hawkeye Pierce

        Re: As someone who understand blockchain ...

        What a ridiculous statement. Given that the majority of the "all-time high prices" have happened in the last two or so years, your arbitrary timeframe of having held bitcoin for four years nicely - for you - eliminates all those who bought at those prices in the last two years from your consideration.

        Come back in two years time and let's see what's happened then. Not saying you wont still be right, but show me any single share price chart and I can find an arbitrary but retrospectively-looking statement of how you couldn't fail to have lost money - if only along the lines of "buy in [insert-random-month-here] and sell in [insert-other-random-month-here]".

        1. tony72

          Re: As someone who understand blockchain ...

          Given that the majority of the "all-time high prices" have happened in the last two or so years, your arbitrary timeframe of having held bitcoin for four years nicely

          Maybe I assumed too much in terms of general subject knowledge or common sense. Bitcoin has a four-year halving cycle - the interval at which the mining block reward is halved - and this is generally considered to be the driving factor behind the overall market cycles. Thus the choice of a four-year period was anything but arbitrary - over a four-year period, the price at the start and end of the period are approximately the same time delta from the last halving. Any other period and you would be comparing prices at different points in the market cycle, which would be less meaningful.

          1. firefly

            Re: As someone who understand blockchain ...

            What drives crypto is market manipulation, stablecoin fraud and wash trading. The 'halving cycle' is irrelevent.

      3. Just Enough

        Re: As someone who understand blockchain ...

        Let me guess. You have "invested" in bitcoins and, like everyone else shilling for it, have an interest in sucking further suckers into the giant ponzi scheme ?

      4. DS999 Silver badge

        Because it has gone up in the past it will go up forever

        I look forward to the crying from all the stupids who put most of their net worth into bitcoin and will simply watch it fall, believing that because it has always rebounded in the past it will do so again.

        The fact it started falling when the stock market started falling exposes that it is an asset bubble made possible by easy money, and as interest rates rise and money supply tightens it will continue to fall more rapidly than other less "frothy" assets.

    2. Anonymous Coward
      Holmes

      Re: As someone who understand blockchain ... Wrong!

      Anyone who equates blockchain and Bitcoin doesn't understand blockchain.

      Bitcoin may rely on the blockchain but so do many other things. There's a reason smart contracts based on the blockchain are of growing interest to companies. There's a reason countries are exploring blockchain based currencies. There's a reason stable coins are gaining popularity.

      As far as investing in Bitcoin at this stage, it's speculative. Then again, so is the stock market and the commodities market. Never forget that “What’s good for General Motors is good for America” was accepted right until GM went bankrupt.

      Speaking as a successful investor and not as a financial analyst, unless your investments run to 6 figures, I wouldn't recommend cryptocurrencies. Even then, I would recommend investing in a trust that holds the cryptocurrency. For, myself, I have a small investment in a trust that holds a basket of cryptocurrencies. If you wanted to speculate on a single one, I'd pick Ethereum.

  3. katrinab Silver badge
    Meh

    Is it actually fraud?

    I thought the code was supposed to be the contract, and if the code says you get $78bn, and if the code says you get $78bn if you do whatever they did, then they are acting exactly in accordance with the agreement, even if it wasn't what the authors of the code intended?

  4. Howard Sway Silver badge

    The protocol was exploited by 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c7

    I actually thought I saw him in the street, and was about to report him to the police, but it turned out that it was 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c6 instead.

    1. W.S.Gosset Silver badge

      Re: The protocol was exploited by 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c7

      "You are 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c7 and I claim my ten... Oh, he's gone."

    2. Korev Silver badge
      Boffin

      Re: The protocol was exploited by 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c7

      Quick, dial 0118 999 881 999 119 725 3 and the Police will be on their way

      1. EnviableOne

        Re: The protocol was exploited by 0xd01ae1a708614948b2b5e0b7ab5be6afa01325c7

        that's the fire brigade, i think the police have a 2 on the end

  5. Mike 137 Silver badge

    Yet again?

    ""creating a website on which they can download records of their holdings being stolen, for presentation to police"

    Rather reminiscent of Equifax offering a credit rating monitoring service to its customers after its monumental 2017 data breach - "we screwed up, so trust us".

  6. druck Silver badge

    Good luck with that

    creating a website on which they can download records of their holdings being stolen, for presentation to police

    Just been reading that the police are now only solving about 3% of burglaries - a crime where a real person breaks in to someone's home and steals something real. What do you think the police are going to be able to do about theft of made up virtual scam coins?

    1. Anonymous Coward
      Anonymous Coward

      Re: Good luck with that

      Just been reading that the police are now only solving about 3% of burglaries

      That's because they are very busy on Twitter "checking peoples thinking" as they openly admit.

      This is where you tweet something. Someone doesn't like it so goes crying to the police. Rather than say "get a grip", the police spot an opportunity to avoid doing any real work (which let's face it is hard and dangerous) and pop around to "have a word" even though no crime has been committed.

      Google "Harry Miller" and see if I'm right.

      Notice the CoA slapped the police down, and they are STILL doing it.

      1. Sub 20 Pilot

        Re: Good luck with that

        And wasting millions on pointless investigation into someone saying the wrong word which upsets some Guardian reader.

        Or a pretent investigation into no 10 - I will put money on the result being: ''we thoroughly investigated the evidence but did not find enough to warrant a case'' - even though nothing bigger than a mouse can get into and out of the place without CCTV or logging in/out and photography / ID logging etc.

        And that it will be released the day when there is another bit of bad news to hide behind. I have half suspected that the SG report was held back hoping that Russia would have invaded Ukraine by now so a great time to release..

        I am afraid our government or the current alternatives are not fit for purpose and the police, of which the vast majority of hard working, dedicated officers fighting against the scum and the guidelines, are also run by people who are more concerned about political correctness, thought crime and box ticking.

        How have we arrived at a point where a crime against someone can be dismissed while the same crime against someone else is a ''hate crime''.

        To badly paraphrase Gene Hunt - a hate crime, as opposed to one of those friendly murders.

        The human race needs wiping out in general but some poeple, even more so.

    2. Anonymous Coward
      Anonymous Coward

      Re: Good luck with that

      @druck

      Oh they will do plenty. And make plenty of noise about what they are doing and how great and clever they are.

      After all, tracking down bitcoin "thefts" is far more sexy than visiting a burglary victim, taking a statement, issuing a crime number and then they forget about it.

      Would you agree?

  7. Plest Silver badge
    Facepalm

    Did I miss the bleedin' obvious here?

    Criminals, repeat "criminals", lifted $80m and you're offering $2m if they return it? Hmmm, I'm all for the positive attitude and belief in the goodness of people but people are generally greedy sods and if one number is bigger than the other to this magnitude I think it's pretty much gone.

    1. Disgusted Of Tunbridge Wells

      If they take the $2mn, that's legal and they can put it in a bank, so to speak. They can also stop looking over their shoulder.

      No laundering, no potential prison time, etc.

      That $78m isn't $78m they can spend. They'll have to find a way to get it into fiat currency and launder it.

      You'd guess they have a plan, but who knows?

      1. Cuddles

        "If they take the $2mn, that's legal and they can put it in a bank, so to speak. They can also stop looking over their shoulder."

        Nope, a crime doesn't stop being a crime just because you change your mind and try to undo it later. If I break into your house and steal your TV, I'm still guilty of burglary if I return it next week. There may be less motivation to actually hunt me down since there is no longer anything to be recovered and limited resources may be better spent elsewhere, but the crime was still committed.

        1. Disgusted Of Tunbridge Wells

          I would assume that the $2m would come with a get-out-of-jail-free promise.

          The promise not to press charges might not hold up in court, but it's better than definitely being wanted for stealing something you're going to have a hard time spending.

  8. Anonymous Coward
    Anonymous Coward

    Were I the culprits, I'd consider just literally throwing away the keys, and letting that crypto rot in a forever-locked wallet. 80 million dollar cryptonerd tears would be exquisite.

  9. spireite Silver badge
    Pirate

    Ah, crypto coins, a scandal in waiting. Many know it's a scandal but still have a vested interest.

    I'd go to sleep at night wondering if my 'investment' is where I left it, or if someone has secreted it away...... but I know I wouldn't sleep, which is why I don't have any, and never have.

    A friend of mine, who got involved in the very early days mining (rather than buying) made a shitload. So, you can sit on the fence of the morals of selling his coins that essentially cost him nothing, to people who potentially knew no better. There's a big but though, many of those buyers are fellow techies who couldn't see any failure, or refuse to believe there will be a failure.

    He is actively warning people not to go in now, because it some point it'll all just disappear and you're left holding an empty bag.... that will happen IMO.

  10. Anonymous Coward
    Anonymous Coward

    As an aside

    Anyone investing in a company that uses a tagline so puke inducing that even a detergent manufacturer wouldn't use the fucking thing, indeed it is borderline "yuppie" in its awfulness, deserves all they get.

    I give you "Lend to ascend – Borrow for tomorrow".

    And, all hope died...

  11. Anonymous Coward
    Anonymous Coward

    Hmm. Trade 28 million of untraceable and unretrievable funds for being identified and receiving 2 million.

    Nah, I can't say that would appeal to too many miscreants...

  12. MOH

    Call now!

    ... for your free motorboat! Um, free bug bounty

  13. Ian Johnston Silver badge

    How nice to see a convergence of cryptocurrency and quantum computing. All it needs now is some cold fusion and an Edison diagnostic machine and peak scam will have been achieved.

    1. diver_dave

      Err... I think

      I think you managed to miss a certain Mr N Tesla

    2. Ace2 Silver badge

      Have you considered including AI/ML in your business plan?

  14. newspuppy

    a flaw in the implementation?

    I am gobsmacked..... how could code be used in unintended ways? As in a bug/unintended feature?

    <QUOTE>

    Last Friday Qubit admitted one of its protocols had been exploited in unintended ways, with the result that attackers made off with $80 million of crypto assets.

    <END QUOTE>

    I've been involved in hardware and software since the early 70's.... and I have yet to see a perfect implementation of any system..

    As one of my professors once said.. The only Code that is bug free is a 'RESET' instruction as the first instruction to be executed on a reset... and just about as useful..... and then there will probably be a hardware fault.

    The concept of 'smart contracts' is brilliant... the implementation is a nightmare... Bug Free? Hell.. I know of no bug free code in existence.... (that happens to be useful)

    The reason that major stock markets have a T+3 Settlement date officially is to allow 'errors' to be unwound.. Dangerous consequences for high frequency traders as institutions found out in the flash crash as they bought very very low and sold higher..... to find out that they did sell higher.. but did not buy low..... and in fact had lost a great deal, or open stop loss orders were executed.

    Over 21,000 trades were invalidated.. ( https://archive.boston.com/business/markets/articles/2010/05/21/sec_eyes_new_rules_in_wake_of_flash_crash/ ) not so simple to do with a 'smart contract' that 'may/probably' has bugs...

    so.. waiting for my education to begin to help me understand why the 'smart contract' approach has a chance of success...

  15. julian.smith
    Boffin

    Another inside job?

    People who buy crypto will belive anything

    There's (more than) one born every day

  16. T. F. M. Reader

    Qubit Finance

    Just curious: was their crypto based on qubits or did the thieves use qubits to break it?

  17. Anonymous Coward
    Anonymous Coward

    The Cloud...

    Other peoples computers you have no control over

    1. Sub 20 Pilot

      Re: The Cloud...

      You, Sir, have cut through the bull shite and wank of the marketing cunts over the last decade and provided what I can only describe as the Perfect Description of the whole cloud clusterfuckery.

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