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Blimey! ANOTHER Bitcoin bleed brouhaha

Poloniex loses TEN PER CENT of depositors' funny money

Internet Security Threat Report 2014

A cryptocurrency exchange called Poloniex has lost more than ten per cent of its entire stash of Bitcoin after allegedly being hacked.

Tristan D'Agosta, who runs Poloniex under the pseudonym Busoni, admitted to the loss and issued a comprehensive rundown of what went wrong.

This approach contrasts starkly with the wall of silence put up by Mt. Gox after last week's mysterious collapse.

The Poloniex boss said the hacker found a vulnerability in the code that handles withdrawals. This flaw allowed the crypto cat-burglar to jam the system with multiple simultaneous withdrawal requests, tricking the exchange into paying out more money than it should.

With remarkable frankness, Busoni 'fessed up to this "design flaw" and admitted it could have been avoided if withdrawals were processed one after the other, rather than at the same time.

He has promised to repay people who have lost money in the theft, which resulted in the loss of 12.3 per cent of the exchange's money reserves. Although there has been no clear explanation of how much the nicked funny money is worth in real world readies, observers have suggested the amount adds up to something in the region of $50,000.

Busoni said he would "take full responsibility" and wrote: "I would like to thank everyone for their support and understanding. It really means a lot. Having other people's money taken under my watch has made me feel just about as awful as I've ever felt in my life."

However, he doesn't have enough Bitcoin to pay back the unlucky victims just yet and has launched a poll on what to do to start compensate people whose digital stash was swiped.

Poloniex has halted all Bitcoin transactions for the time being whilst it works on a cast-iron fix.

Cryptocurrency evangelists have had their faith in digital dosh sorely tested in recent weeks, following the Mt. Gox collapse and a large scale theft from Flexcoin, which described itself as "The Bitcoin Bank" - until thieves making off with 896BTC forced its owners to shutter the site. ®

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