4 ms·

Part of the problem here is the lack of fraud insurance from CoinBase/exchanges. If the attacker would have instead stolen from his bank (several US and Canadia

by tga 7y ago

Part of the problem here is the lack of fraud insurance from CoinBase/exchanges. If the attacker would have instead stolen from his bank (several US and Canadian banks I know happily allow logins with only a password or are only starting to introduce SMS-only 2fa), it is likely that the bank would have returned the money, whether they could revert the transaction or not, and then pursued the hackers themselves.

knorker 7y ago
because they can (usually) revert it. Because reversibility is a good thing.
- aeorgnoieang 7y ago
  Fraudulent transactions made with a regular bank account are pretty irreversible too. There's a whole extra layer of infrastructure on top of the 'core' banking services that allows them (banks) to 'reverse' a fraudulent transaction. But I'd be very very surprised if fraudulent charges are 'reversible' in any other way than the bank reimbursing the account holder. In other words, crypto-currency exchanges could do the same thing (but then they'd almost certainly have/want to charge for that). Double-entry bookkeeping is also, ideally, irreversible.
  - anaisbetts 7y ago
    They are generally reversible until they cross borders, then it gets way more complicated. Most of these scammers are outside the US, they immediately make an international wire transfer of the money, then split it apart to a bunch of separate accounts, in order to make reverting impossible
  - knorker 7y ago
    Real banks have been hacked (e.g. full mainframe root access), and the hackers have made international transfers which were reversed. Sure. When bank accounts get hacked sometimes the bank just eats the cost, but if $100k goes to another bank they'll contact that bank to have the money be clawed back. Now I say "reversed", but the end goal I mean is "the money was transferred back" because it's traceable and doesn't require the cooperation of the receiving account holder. Not that it gets "undone" in double-entry bookkeeping. Indeed bank hacks have lost some money when the "reversal" incurred currency fluctuation effects. (which could have gone the other way, too). Also no, regular bank transfers are very reversible because courts can order it so. The justice system can order accounts frozen. With cryptocurrency the illusion is "math is the ultimate arbiter", but of course "math" can't solve "so what happens if one party broke the law", but is forced to answer "well... I guess they win, then". Also compare smart contracts. You can make an illegal contract. Say the equivalent of selling yourself into slavery. Smart contracts want there to be no court that says "actually, that's slavery, and this contract is void, also the money must be returned". To think that "math" can provide justice better than a justice system is not just holding low esteem for justice systems in general. It's anarchy, and tyranny by exploitation. "People" are not lawyers, which is why some things are not allowed in contracts. "People" are not coders, which is why smart contracts are also not a thing that will happen (on a scale cryptocurrency people dream of).

by tga 7y ago

knorker 7y ago

because they can (usually) revert it. Because reversibility is a good thing.

aeorgnoieang 7y ago
Fraudulent transactions made with a regular bank account are pretty irreversible too. There's a whole extra layer of infrastructure on top of the 'core' banking services that allows them (banks) to 'reverse' a fraudulent transaction. But I'd be very very surprised if fraudulent charges are 'reversible' in any other way than the bank reimbursing the account holder. In other words, crypto-currency exchanges could do the same thing (but then they'd almost certainly have/want to charge for that). Double-entry bookkeeping is also, ideally, irreversible.
- anaisbetts 7y ago
  They are generally reversible until they cross borders, then it gets way more complicated. Most of these scammers are outside the US, they immediately make an international wire transfer of the money, then split it apart to a bunch of separate accounts, in order to make reverting impossible
- knorker 7y ago
  Real banks have been hacked (e.g. full mainframe root access), and the hackers have made international transfers which were reversed. Sure. When bank accounts get hacked sometimes the bank just eats the cost, but if $100k goes to another bank they'll contact that bank to have the money be clawed back. Now I say "reversed", but the end goal I mean is "the money was transferred back" because it's traceable and doesn't require the cooperation of the receiving account holder. Not that it gets "undone" in double-entry bookkeeping. Indeed bank hacks have lost some money when the "reversal" incurred currency fluctuation effects. (which could have gone the other way, too). Also no, regular bank transfers are very reversible because courts can order it so. The justice system can order accounts frozen. With cryptocurrency the illusion is "math is the ultimate arbiter", but of course "math" can't solve "so what happens if one party broke the law", but is forced to answer "well... I guess they win, then". Also compare smart contracts. You can make an illegal contract. Say the equivalent of selling yourself into slavery. Smart contracts want there to be no court that says "actually, that's slavery, and this contract is void, also the money must be returned". To think that "math" can provide justice better than a justice system is not just holding low esteem for justice systems in general. It's anarchy, and tyranny by exploitation. "People" are not lawyers, which is why some things are not allowed in contracts. "People" are not coders, which is why smart contracts are also not a thing that will happen (on a scale cryptocurrency people dream of).