A German scammer refused to provide the police with the password to a $60 million bitcoin wallet after the police seized it containing 1700 BTC, as we are reading more in today’s latest Bitcoin news.
The German authorities seized the BTC Wallet with 1700 BTC but the wallet owner refused to cooperate in disclosing the password. The seizure came about the investigation to convert crypto-malware installations from two years ago. The German scammer served his sentence but remained silent on the matter. Prosecutor Sebastian Murer commented that the scammer could have lost the password so the authorities have no way of accessing these funds:
“Perhaps he doesn’t know. We asked him but he didn’t say.”
In 2019, when the man was sentenced for fraud, Bitcoin was valued a lot less than it is today. Over the year, BTC ranged in price from $3.5K to $13.6K but since the third quarter of 2020, the parabolic surge saw massive price surges and which ended up in the fraudster gaining a fortune. Now that the convicted fraudster is a free man, the police ensured he cannot access the funds but details are not forthcoming yet. There are many types of crypto wallets including hot and cold wallets so technical BTC is not stored in a wallet.
Instead, the wallet corresponded with a private key that contains address transactional information on the blockchain as well as access to the funds. Users can restore the modern wallet using a 12-word passphrase which is accessible via a password. The users are able to memorize both passphrase and password so the private keys can also be stored outside of the providers’ system. However, problems can occur where the user will either lose it or forget them.
Former CTO or Ripple Stefan Thomas made headlines a couple of weeks ago after It emerged that he had lost the password to his wallet that contained 7002 BTC. To make things worse, Thomas stored his private key on a self-destructing IronKey USB drive which erases the drive content after 10 failed password attempts. He has already fried 8 times before to guess it. Thomas wrote the password on a piece of paper and eventually lost the paper. He now feels embittered at the strapline that eventually promises freedom to be your own bank:
“This whole idea of being your own bank — let me put it this way: Do you make your own shoes? The reason we have banks is that we don’t want to deal with all those things that banks do.”
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