bitcoin small Bitcoin exchange goes offline after $250,000 theft

A major Bitcoin currency exchange has gone offline after $250,000 worth of Bitcoins were stolen from its servers, marking the latest in a series of security issues for the virtual money.

A major Bitcoin currency exchange has gone offline after $250,000 worth of Bitcoins were stolen from its servers, marking the latest in a series of security issues for the virtual money.

 
The exchange, Bitfloor, is the largest in the US and the fourth largest in the world, according to its founder, Roman Shtylman, but it may have to cease operation altogether following this incident.
 
Shtylman revealed that he had kept unencrypted keys for Bitcoins, which gave cybercriminals easy access to the money. This is a major security failing on Bitfloor's part, as the keys are the only thing a person needs to access and retrieve Bitcoins from across the web. Normally Bitfloor uses encryption, but a recent upgrade led to an unencrypted copy of the keys being made available.
 
 Bitcoin exchange goes offline after $250,000 theft
 
With most of the money on the exchange stolen, Shtylman fears he will have to close Bitfloor and attempt to pay back users with remaining funds. He said no records were lost in the attack, but it seems unlikely that all users will receive repayments for their missing money.
 
Another Bitcoin exchange called Bitcoinica was forced to shut its doors earlier this year when it was unable to honour a promise to reimburse users after its servers were hacked twice, leading to a lawsuit by affected users. The spate of Bitcoin-related attacks shows the growing popularity of the difficult to trace virtual currency, but it also exposes a major security vulnerability that may scare off future Bitcoin investers.
 
Source: BBC