7 ms·

If a lay person were to ask how they get back their Bitcoins if they are stolen from their account, say due to a person gaining access to their computer, what d

If a lay person were to ask how they get back their Bitcoins if they are stolen from their account, say due to a person gaining access to their computer, what do you tell them?

JonnieCache 14y ago
You tell them it's the same as cash.
- recursive 14y ago
  So I can deposit it in my checking account?
  - nym 14y ago
    Yes, using a 3rd party service such as Coinbase.com.
esrauch 14y ago
I think the correct response is asking how they would get back their money if cash was stolen from their house. BitCoin is like cash, not like a credit card. You wouldn't want to leave a significant amount of cash laying around your house and you shouldn't keep a significant amount of BitCoin on your computer.
- wlesieutre 14y ago
  I'd trust it more on my own computer than on any of the bitcoin exchanges. There have been a number of pretty giant security and backup lapses, and they haven't been around long enough for me to trust any of their reputations. My own computer on the other hand, is pretty definitely secure. And I can encrypt the wallet if I'm extra paranoid. This doesn't really extend to your average computer user, and I don't think BTC will take off in any meaningful sense until we have a user friendly and secure architecture for it. But the current state of being a currency for the tech-savvy isn't necessarily a bad thing.
- Goronmon 14y ago
  >I think the correct response is asking how they would get back their money if cash was stolen from their house. But stealing Bitcoins doesn't require physical access to your property. That seems like a pretty big distinction to me. Edit: And if Bitcoins are like cash, why should I bother using them? I already have cash (that I don't use very often) available to me readily. And since I get paid in dollars, what advantage do I have to use a separate currency solely for rare and unimportant transactions?
  - spindritf 14y ago
    You can't send cash over the Internet.
    - Goronmon 14y ago
      I've used Paypal in the past. Bitcoin is like cash (pseudo-anonymous, nobody can technically interfere with your transactions...) except it is digital while preserving these advantages. This is why it cannot be compared to Paypal. So, Bitcoin is like cash, except in the important ways in which it is different. And along with also gaining some more disadvantages as well. But you're right, Paypal isn't cash. But then again, neither is Bitcoin.
      - deleted 14y ago
        [deleted]
      - mrb 14y ago
        Being digital and decentralized are 2 significant advantages. Unless you are a luddite preferring to send cash in the mail!
    - mrb 14y ago
      Goronmon: a Paypal account is in no way similar to cash. It can be frozen by authorities. It is centralized. It is not anonymous. Bitcoin is like cash (pseudo-anonymous, nobody can technically interfere with your transactions...) except it is digital while preserving these advantages. This is why it cannot be compared to Paypal.
bo1024 14y ago
Same thing you tell them if someone accessed their computer and transferred money out of their bank account. "Secure your [stuff]."
- ceejayoz 14y ago
  That's actually not what a bank typically tells you in that situation, so you've sort of proved the point.
  - DanBC 14y ago
    Banks are happy to tell people that "chip and pin" credit cards are secure, and thus any transactions on them cannot be fraudulent. In England there's a voluntary code to protect consumers; that code says that the burden is on the bank to prove that transactions are not fraud. Banks were using chip and pin as "proof" that the transactions were fraud. (http://www.cl.cam.ac.uk/~sjm217/papers/oakland10chipbroken.pdf http://www.cl.cam.ac.uk/~sjm217/papers/oakland10chipbroken.p...) This is all a tangent to the security of Bitcoin. Bitcoin is horrifically insecure, and there are no trustworthy banks for Bitcoin.
- jtbigwoo 14y ago
  The bank would try to work with you to investigate and possibly reverse the transaction and refer your case to law enforcement. (Wire transfers cannot be reversed, but EFT payments often can.) A bank would most certainly not say, "secure your stuff" and leave it at that.
smanek 14y ago
If a lay person were to ask how they get back their dollars if they are stolen from their wallet, say due to a person mugging them, what do you tell them?
- wmf 14y ago
  To put their money in a bank. But there are no secure Bitcoin banks.
  - drivebyacct2 14y ago
    I'm willing to bet that I have more protection securing the contents of my Bitcoin Wallet than Wells Fargo has protecting my account at any level.
    - Goronmon 14y ago
      >I'm willing to bet that I have more protection securing the contents of my Bitcoin Wallet than Wells Fargo has protecting my account at any level. Would you say this is true for most users?
      - deleted 14y ago
        [deleted]
      - lucb1e 14y ago
        Currently? Of course not. But when the idea of storing money on your computer (e.g. in a file) becomes more widespread, then the answer would be yes. Or at the very least it would be equally secure. It's not that hard to provide people with a secure environment, as long as that environment is designed with with security in mind. A non-jailbroken smartphone is probably good enough, though a dedicated device might be better. And you can use live boots. I can see a future where we use such (or similar) things to do money transfers.
        majormajor 14y ago
jerf 14y ago
The current answer is, you can not. In the long term, I suspect you'll see insurance companies arise that would handle that. In the end they'd probably build a better system than the one that currently exists, which sort of uses rollbacks as a crutch to avoid needing really solid security. (There are many reasons for that. Not all of them are bad.) But there's many a theft betwixt here and there.
travisp 14y ago
This is an important question to raise. One of the only reasons that credit cards were able to take off was because the credit card companies promised to limit your liability if your credit cards were stolen. Similarly, there are countless examples of people's bank and investment accounts getting hacked, with the banks and brokerages reimbursing their customers to prevent bad PR. Given this, I imagine that it would be a long time before the average person would be comfortable maintaining any store of money as Bitcoins (versus quick conversion and payment for things, but then what's the point?).
- logn 14y ago
  Agreed this is a main reason BTC is struggling. But also, Bitcoins can increase greatly in value especially since at a certain point it's guaranteed there's no inflation. I just don't see people willing to spend something that can increase so much in value. It's like paying for Reddit with fractions of Facebook stock.
  - VikingCoder 14y ago
    "since at a certain point it's guaranteed there's no inflation." I'm sorry, but this is a statement you cannot make. To make this claim, it would need to be true that the cost, in Bitcoins, of goods and services in the real world, would never rise. There is no basis to believe this is true.
    - narrator 14y ago
      "The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy." -L. Von Mises
      - jerf 14y ago
        In that statement, L. Von Mises is presuming some things that are not true of BitCoin. In particular, the BitCoin creator has essentially made it impossible for anybody to change the number of BitCoins in circulation. Thus while it may be true that no governmental entity or currency controller will choose to inflate the currency through some activity, it is not true that the currency will therefore not vary in value over time when compared to some other things, and it isn't unfair to say that if I need more BitCoins to buy something now than I did last year, the currency has inflated, and vice versa. It may not be precisely the same as fiat currency inflation in every detail, but it's broadly the same, but it won't be the result of changing policy. (Arguably one could call it the result of an unchanging policy set at the beginning.)
javert 14y ago
I'm really surprised nobody has mentioned Coinbase, which is YC funded, as an answer to this question. Coinbase is a hosted bitcoin wallet. In terms of security, I'd certainly be happy trusting them with several hundred dollars worth of bitcoins at a time, which more than enables e-commerce using bitcoins.
drivebyacct2 14y ago
The same thing I'd tell someone if they left their wallet on a coffee table in public and it were stolen. Why is this being downvoted? What am I supposed to say? I'd say the same thing as if they were hacked and malware stole their credit card. Computers aren't magic; there is an expectation that you know what you're doing with them. If you don't know how to secure a wallet, don't use Bitcoins. If you don't know how to keep malware from stealing your credit card, don't download virus-infested porn or go buy an iDevice. I'm assuming I was being seen as cynical but as with "the command line" and "Git", I'm not sure what people want. A magic, easy, secure solution? Sure, we'll just ignore the fact that identity management, authentication and security aren't complex issues that are still evolving today. If we're just rehashing "Centralized currency is easier to use" then by all means, whatever, yes, Bitcoins are currently harder to use than cash both because they're more complicated and because there is almost no infrastructure to support their use. But frankly, that's really a completely separate issue from whether or not they can be used securely. I can give you tens of security and usability problems that cash has day-to-day that Bitcoins are unaffected by.
gnaritas 14y ago
At this point in time, I'd say lay persons aren't using bitcoin to begin with.
prawks 14y ago
Get some physical BitCoins https://www.casascius.com/ https://www.casascius.com/
- shiftpgdn 14y ago
  Can you help me understand how this works? How is there both physical and bitcoin value?
  - nym 14y ago
    They're made out of gold/silver, and have an associated BTC value.
  - wmf 14y ago
    The normal[1] physical Bitcoins have no physical value; they're just a paper wallet[2] with a certain balance, glued to a brass coin. The tamper-evident holograms are pretty cool. [1] The silver/gold ones are so confusing that I won't address them. [2] https://en.bitcoin.it/wiki/Paper_wallet https://en.bitcoin.it/wiki/Paper_wallet
nym 14y ago
Use a wallet like Coinbase, which stores 87% of funds offline. http://howdoyoubuybitcoins.com/from/coinbase/ http://howdoyoubuybitcoins.com/from/coinbase/
deleted 14y ago
[deleted]
dlitz 14y ago
Well, nothing yet, but multi-signature Bitcoin accounts are the current top priority of upstream Bitcoin developers, so I suspect we'll soon see hardware tokens and/or 3rd-party services acting helping to prevent Bitcoin theft. Actually, this could be a boon for computer security: We might actually get some real security, rather than the ex post facto "security" that antivirus products supposedly provide.
celticninja 14y ago
The same way you would go about getting back cash that was stolen from your wallet when you left it lying around in an unsecure area. to be honest, if someone is handling BTC then as long as they password protect their wallet then the only way the BTC can be stolen is if someone gains access to their password. as with any online banking facility, or debit card facility, if your password or PIN becomes compromised and money stolen from your account you have no automatic right to restitution.

If a lay person were to ask how they get back their Bitcoins if they are stolen from their account, say due to a person gaining access to their computer, what do you tell them?

JonnieCache 14y ago

You tell them it's the same as cash.

recursive 14y ago
So I can deposit it in my checking account?
- nym 14y ago
  Yes, using a 3rd party service such as Coinbase.com.

esrauch 14y ago

I think the correct response is asking how they would get back their money if cash was stolen from their house. BitCoin is like cash, not like a credit card. You wouldn't want to leave a significant amount of cash laying around your house and you shouldn't keep a significant amount of BitCoin on your computer.

wlesieutre 14y ago
I'd trust it more on my own computer than on any of the bitcoin exchanges. There have been a number of pretty giant security and backup lapses, and they haven't been around long enough for me to trust any of their reputations. My own computer on the other hand, is pretty definitely secure. And I can encrypt the wallet if I'm extra paranoid. This doesn't really extend to your average computer user, and I don't think BTC will take off in any meaningful sense until we have a user friendly and secure architecture for it. But the current state of being a currency for the tech-savvy isn't necessarily a bad thing.
Goronmon 14y ago
>I think the correct response is asking how they would get back their money if cash was stolen from their house. But stealing Bitcoins doesn't require physical access to your property. That seems like a pretty big distinction to me. Edit: And if Bitcoins are like cash, why should I bother using them? I already have cash (that I don't use very often) available to me readily. And since I get paid in dollars, what advantage do I have to use a separate currency solely for rare and unimportant transactions?
- spindritf 14y ago
  You can't send cash over the Internet.
  - Goronmon 14y ago
    I've used Paypal in the past. Bitcoin is like cash (pseudo-anonymous, nobody can technically interfere with your transactions...) except it is digital while preserving these advantages. This is why it cannot be compared to Paypal. So, Bitcoin is like cash, except in the important ways in which it is different. And along with also gaining some more disadvantages as well. But you're right, Paypal isn't cash. But then again, neither is Bitcoin.
    - deleted 14y ago
      [deleted]
    - mrb 14y ago
      Being digital and decentralized are 2 significant advantages. Unless you are a luddite preferring to send cash in the mail!
  - mrb 14y ago
    Goronmon: a Paypal account is in no way similar to cash. It can be frozen by authorities. It is centralized. It is not anonymous. Bitcoin is like cash (pseudo-anonymous, nobody can technically interfere with your transactions...) except it is digital while preserving these advantages. This is why it cannot be compared to Paypal.

bo1024 14y ago

Same thing you tell them if someone accessed their computer and transferred money out of their bank account. "Secure your [stuff]."

ceejayoz 14y ago
That's actually not what a bank typically tells you in that situation, so you've sort of proved the point.
- DanBC 14y ago
  Banks are happy to tell people that "chip and pin" credit cards are secure, and thus any transactions on them cannot be fraudulent. In England there's a voluntary code to protect consumers; that code says that the burden is on the bank to prove that transactions are not fraud. Banks were using chip and pin as "proof" that the transactions were fraud. (http://www.cl.cam.ac.uk/~sjm217/papers/oakland10chipbroken.pdf http://www.cl.cam.ac.uk/~sjm217/papers/oakland10chipbroken.p...) This is all a tangent to the security of Bitcoin. Bitcoin is horrifically insecure, and there are no trustworthy banks for Bitcoin.
jtbigwoo 14y ago
The bank would try to work with you to investigate and possibly reverse the transaction and refer your case to law enforcement. (Wire transfers cannot be reversed, but EFT payments often can.) A bank would most certainly not say, "secure your stuff" and leave it at that.

smanek 14y ago

If a lay person were to ask how they get back their dollars if they are stolen from their wallet, say due to a person mugging them, what do you tell them?

wmf 14y ago
To put their money in a bank. But there are no secure Bitcoin banks.
- drivebyacct2 14y ago
  I'm willing to bet that I have more protection securing the contents of my Bitcoin Wallet than Wells Fargo has protecting my account at any level.
  - Goronmon 14y ago
    >I'm willing to bet that I have more protection securing the contents of my Bitcoin Wallet than Wells Fargo has protecting my account at any level. Would you say this is true for most users?
    - deleted 14y ago
      [deleted]
    - lucb1e 14y ago
      Currently? Of course not. But when the idea of storing money on your computer (e.g. in a file) becomes more widespread, then the answer would be yes. Or at the very least it would be equally secure. It's not that hard to provide people with a secure environment, as long as that environment is designed with with security in mind. A non-jailbroken smartphone is probably good enough, though a dedicated device might be better. And you can use live boots. I can see a future where we use such (or similar) things to do money transfers.
      - majormajor 14y ago

jerf 14y ago

The current answer is, you can not. In the long term, I suspect you'll see insurance companies arise that would handle that. In the end they'd probably build a better system than the one that currently exists, which sort of uses rollbacks as a crutch to avoid needing really solid security. (There are many reasons for that. Not all of them are bad.) But there's many a theft betwixt here and there.

travisp 14y ago

This is an important question to raise. One of the only reasons that credit cards were able to take off was because the credit card companies promised to limit your liability if your credit cards were stolen. Similarly, there are countless examples of people's bank and investment accounts getting hacked, with the banks and brokerages reimbursing their customers to prevent bad PR. Given this, I imagine that it would be a long time before the average person would be comfortable maintaining any store of money as Bitcoins (versus quick conversion and payment for things, but then what's the point?).

logn 14y ago
Agreed this is a main reason BTC is struggling. But also, Bitcoins can increase greatly in value especially since at a certain point it's guaranteed there's no inflation. I just don't see people willing to spend something that can increase so much in value. It's like paying for Reddit with fractions of Facebook stock.
- VikingCoder 14y ago
  "since at a certain point it's guaranteed there's no inflation." I'm sorry, but this is a statement you cannot make. To make this claim, it would need to be true that the cost, in Bitcoins, of goods and services in the real world, would never rise. There is no basis to believe this is true.
  - narrator 14y ago
    "The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy." -L. Von Mises
    - jerf 14y ago
      In that statement, L. Von Mises is presuming some things that are not true of BitCoin. In particular, the BitCoin creator has essentially made it impossible for anybody to change the number of BitCoins in circulation. Thus while it may be true that no governmental entity or currency controller will choose to inflate the currency through some activity, it is not true that the currency will therefore not vary in value over time when compared to some other things, and it isn't unfair to say that if I need more BitCoins to buy something now than I did last year, the currency has inflated, and vice versa. It may not be precisely the same as fiat currency inflation in every detail, but it's broadly the same, but it won't be the result of changing policy. (Arguably one could call it the result of an unchanging policy set at the beginning.)

javert 14y ago

I'm really surprised nobody has mentioned Coinbase, which is YC funded, as an answer to this question. Coinbase is a hosted bitcoin wallet. In terms of security, I'd certainly be happy trusting them with several hundred dollars worth of bitcoins at a time, which more than enables e-commerce using bitcoins.

drivebyacct2 14y ago

The same thing I'd tell someone if they left their wallet on a coffee table in public and it were stolen. Why is this being downvoted? What am I supposed to say? I'd say the same thing as if they were hacked and malware stole their credit card. Computers aren't magic; there is an expectation that you know what you're doing with them. If you don't know how to secure a wallet, don't use Bitcoins. If you don't know how to keep malware from stealing your credit card, don't download virus-infested porn or go buy an iDevice. I'm assuming I was being seen as cynical but as with "the command line" and "Git", I'm not sure what people want. A magic, easy, secure solution? Sure, we'll just ignore the fact that identity management, authentication and security aren't complex issues that are still evolving today. If we're just rehashing "Centralized currency is easier to use" then by all means, whatever, yes, Bitcoins are currently harder to use than cash both because they're more complicated and because there is almost no infrastructure to support their use. But frankly, that's really a completely separate issue from whether or not they can be used securely. I can give you tens of security and usability problems that cash has day-to-day that Bitcoins are unaffected by.

gnaritas 14y ago

At this point in time, I'd say lay persons aren't using bitcoin to begin with.

prawks 14y ago

Get some physical BitCoins https://www.casascius.com/ https://www.casascius.com/

shiftpgdn 14y ago
Can you help me understand how this works? How is there both physical and bitcoin value?
- nym 14y ago
  They're made out of gold/silver, and have an associated BTC value.
- wmf 14y ago
  The normal[1] physical Bitcoins have no physical value; they're just a paper wallet[2] with a certain balance, glued to a brass coin. The tamper-evident holograms are pretty cool. [1] The silver/gold ones are so confusing that I won't address them. [2] https://en.bitcoin.it/wiki/Paper_wallet https://en.bitcoin.it/wiki/Paper_wallet

nym 14y ago

Use a wallet like Coinbase, which stores 87% of funds offline. http://howdoyoubuybitcoins.com/from/coinbase/ http://howdoyoubuybitcoins.com/from/coinbase/

deleted 14y ago

[deleted]

dlitz 14y ago

Well, nothing yet, but multi-signature Bitcoin accounts are the current top priority of upstream Bitcoin developers, so I suspect we'll soon see hardware tokens and/or 3rd-party services acting helping to prevent Bitcoin theft. Actually, this could be a boon for computer security: We might actually get some real security, rather than the ex post facto "security" that antivirus products supposedly provide.

celticninja 14y ago

The same way you would go about getting back cash that was stolen from your wallet when you left it lying around in an unsecure area. to be honest, if someone is handling BTC then as long as they password protect their wallet then the only way the BTC can be stolen is if someone gains access to their password. as with any online banking facility, or debit card facility, if your password or PIN becomes compromised and money stolen from your account you have no automatic right to restitution.