The Hacker News — Cyber Security, Hacking, Technology News

Bitcoin is breaking every record—after gaining 20% jump last week, Bitcoin price just crossed the $14,800 mark in less than 24 hours—and there can be no better reason for hackers to put all of their efforts to steal skyrocketing cryptocurrency.

NiceHash, the largest Bitcoin mining marketplace, has been hacked, which resulted in the theft of more than 4,700 Bitcoins worth over $57 million (at the time of breach).

And guess what? You'll be surprised to know that the stolen BTC now worth over $70 million—in less than 24 hours.

Founded in 2014, NiceHash is a cloud-based crypto-mining marketplace that connects people from all over the world to rent out their spare computing power to other in order to create new coins.

On Wednesday, several NiceHash users reported that their BTC wallets had been emptied, which was later confirmed by NiceHash after its service went offline claiming to be undergoing maintenance.

At the time of writing, the NiceHash service is still offline with a post on its website, confirming that "there has been a security breach involving NiceHash website," and that hackers stole the contents of the NiceHash Bitcoin wallet.
The company did not provide any further details about the security incident, but it did say that NiceHash has paused its operations for next 24 hours while it figures out exactly how many numbers of BTC were swiped from its website and how it was taken.

Although NiceHash has not confirmed the number of bitcoins stolen from its virtual wallet, some of its customers have circulated a wallet address that suggests around 4,736 BTC—worth more than $70 million based on today's price—in total were drained from the company's wallet.

NiceHash has initiated an investigation into the matter, and has reported the incident to the "relevant authorities and law enforcement" and has been "co-operating with them as a matter of urgency."

The company also assured its customers that it is "fully committed to restoring the NiceHash service with the highest security measures at the earliest opportunity," but it's still unclear how the company will manage to settle everything if it is unable to compensate the total loss.

"We understand that you will have a lot of questions, and we ask for patience and understanding while we investigate the causes and find the appropriate solutions for the future of the service. We will endeavor to update you at regular intervals," the company says.

Following the security incident, NiceHash is recommending its customers to change their passwords—both on NiceHash and other services, if they are using the same credentials.

NiceHash is the latest cryptocurrency company to suffer a significant blow in recent months. Another major hack took place last month due to a flaw in Parity's wallet that caused over $160 million in ETH (Ether) to be frozen, while nearly $32 million in ETH was stolen by hackers in July.

Every time a new topic trends on the Internet, scammers take advantage of it.

You must have heard of Bitcoin and how in recent days it has made some early investors millionaire overnight.

Yes, the Bitcoin boom is back, and it's real — a digital currency that has just crossed a new milestone today. The current price of 1 BTC or 1 Bitcoin = US$2,850.

An American con man took advantage of this boom in Bitcoin market to run bogus bitcoin mining schemes and earn millions of dollars.

But the bogus schemes ended as the United States Securities and Exchange Commission (SEC) has won a legal battle against two bogus, but now defunct, Bitcoin companies operated by Homero Joshua Garza — GAW Miners and ZenMiner.

Garza is now facing a $12 Million (£9.2 Million) penalty for running the bogus schemes – what lawmakers have certified was a "Ponzi scheme."

According to the SEC, Garza used the "lure of quick riches" in order to get people to invest in the bitcoin mining schemes, which means those who add their computing power to help verify transactions, a practice known as mining, are rewarded with Bitcoins.

Garza's GAW Miners and ZenMiner purported to provide shares in cloud-based Bitcoin mining machinery, but nothing like that was ever built by the operator.

Garza told investors that he had enough computing power to mine a lot of bitcoins on their behalf and share the proceeds, but in reality, he just used cash from new investors to reward earlier joiners, which is nothing but a fraudulent "ponzi" scheme, according to the SEC.

The SEC said: "Most investors paid for a share of computing power that never existed." It also said that about 10,000 investors joined the bogus schemes and handed over $20 Million to Garza.

Few got back their money they invested, but many left without a single penny.

The complaint against the Bitcoin mining schemes was filed on 1 December 2015, and on June 2, the US District of Connecticut federal court sided with the SEC, ordering both GAW Miners and ZenMiner to pay a combined of $10,384,099 in disgorgement and prejudgment interest, along with $1,000,000 in damages.

Both GAW Miners and ZenMiner companies have now been shut down.

However, a ruling is yet to be made on the Bitcoin funds collected by Garza. In 2014, when Garza was running the bogus schemes from his home in Connecticut, 1 BTC was equal to $450, and today it is around $2,800.

So, the $20 Million funds Garza took from the investors today worth around $150 million.

"In total, CTU researchers documented 51 compromised networks from 19 different Internet service providers (ISPs)," the Dell team wrote in a blog post on Thursday.

"The threat actor hijacked the mining pool, so many cryptocurrencies were impacted," the researchers write. "The protocols make it impossible to identify exactly which ones, but CTU researchers have mapped activity to certain addresses."

"Unlike network routing protocols that can automatically initiate a connection from one network, both ends of BGP-connected networks (also known as a 'peers') must be manually configured to communicate," the researchers write. "This requirement ensures malicious networks cannot hijack traffic without human intervention from a legitimate network."