Many bitcoin hacks have taken place since the theft. In some cases, the wallet service company that keeps Bitcoin disappears along with the customer’s Bitcoin. Unlike the transaction with a credit card, Bitcoin does not have the concept of cancellation and the transaction (coin moving direction) is irreversible, so the characteristic that it is impossible to recover the lost Bitcoin is a big attraction for bitcoin thieves.

The important steps that a hacker who actually steals Bitcoins

Copy the encryption key

Bitcoin has an open book called Blockchain that records the history of Bitcoin transactions and the current owner. You will also own an encryption key (private key) that can open a specific address by getting Bitcoin, the only evidence that guarantees that this private key is the owner of Bitcoin Will be.

The private key is a series of characters consisting of numbers and alphabets, and does not need to be recorded online.For example, you can print it out, save it as a text file on an external hard disk, or use it as a tattoo on your body. It can be stored by carving it. All the numerous security that ensures the safety of Bitcoin is realized by this secret key. Since all transactions related to Bitcoin are performed using the secret key, it is called Bitcoin = secret key. But it’s not an exaggeration.

Then, what hackers target is necessarily a “secret key.” Marcourt Squires, a Bitcoin early adopter and now running Bitcoin banking service, recommends creating a physical Bitcoin wallet that can be used offline, and keeps your Bitcoin private key online. We warn against the dangers of many Bitcoin wallets we store.

Hackers are repeatedly attacking online wallet services that hold large numbers of bitcoin private keys for many users. This straightforward method is a very effective hacking method, because you can get a large amount of Bitcoin by simply getting the data of the private key recorded on the server. However, hacking is not always done by an external hacker. If you are an insider of the Bitcoin wallet service, you do not need to hack and you can easily get Bitcoin by copying the service user’s private key. You can read more crypto news here: trustpedia

Money Laundering

Money laundering is the next thing a hacker can do after successfully getting a lot of Bitcoin . Since Bitcoin can track the history of ownership by the blockchain, not only victims of theft but also people all over the world can understand the movement route of the stolen Bitcoin. So Bitcoin thieves need to do money laundering to break this tracking network.

Special software called “tumbler” has been developed for “cleaning” bitcoins. The tumbler mixes stolen “dirty” bitcoins together to make tracking difficult. The tumbler moves between addresses by subdividing bitcoins and exchanging a certain amount of bitcoins with each other over time. In addition, tumbler is software that can only be accessed through the anonymous network Tor , and even if you try to trace the distribution channel of stolen bitcoins, the ownership history of bitcoins scattered at various addresses will be huge, In the end, getting to the hacker behind you can be a real daunting task.

However, according to The Verge, bitcoin hackers need to be careful when using a tumbler whether the software is reliable. There is no doubt that a tumbler creator is a hacker who steals bitcoins from a hacker who steals bitcoins.

Exchange

The last thing a hacker does is steal a large amount of Bitcoins and get “clean” Bitcoins after washing their money in a tumbler, to exchange Bitcoins with government-approved currencies. However, if you have too many Bitcoins, then exchanging is not easy. If you forcibly exchange a large amount of money, it will immediately attract attention, and as a result, it may be useful as a bitcoin theft.

Since the Bitcoin market is still immature, Bitcoin lacks liquidity, and finding a buyer who can turn a large amount of Bitcoin into a single transaction can be a difficult task at present. Therefore, in exchange for making a large discount from the market price, a quick exchange method is to search for a financially buoyant buyer.