1 year ago
36 Luke Dashjr, a Bitcoin OG and core developer, alleges that his PGP key was compromised, resulting in virtually all of his Bitcoin being stolen from him on December 31.
One of the original core developers behind Bitcoin (BTC), Luke Dashjr, alleges to have lost ‘basically’ all his BTC funds because of a hack that happened just before the New Year.
In a January 1, post on Twitter, the developer stated that the alleged hackers had somehow gained access to his PGP (Pretty Good Privacy) key, a common security strategy that utilizes two keys to gain access to encrypted information.
In the thread, he shared a wallet address where some of the stolen BTC had been sent but never revealed how much of his BTC was stolen in the process.
PSA: My PGP key is compromised, and at least many of my bitcoins stolen. I have no idea how. Help please. #Bitcoin
— @LukeDashjr@BitcoinHackers.org on Mastodon (@LukeDashjr) January 1, 2023
At the time of publication, the wallet address in question shows four transactions between 2:08 and 2:16 pm UTC on December 31, reaching 216.93 BTC — worth around $3.6 million at current prices.
Dashjr insisted that he had ‘no idea how’ the hackers managed to access his key, though some in the community have already pointed to a possible link with an earlier Twitter post From Dashjr on November 17 that noted that his server had been compromised by “new malware/backdoors on the system.”
PSA: My server was accessed this morning by an unknown person. Full analysis in progress, but take extra care that you PGP-verified any downloads. #Bitcoin
— @LukeDashjr@BitcoinHackers.org on Mastodon (@LukeDashjr) November 17, 2022
Dashjr told a user in his most recent Twitter thread that he had just noticed the recent hack after receiving emails from Kraken and Coinbase about login attempts.
That incident has also caught the attention of Binance CEO Changpeng ‘CZ’ Zhao, who offered condolences and support in a January 1 post. He wrote:
“Sorry to see you lose so much. Informed our security team to monitor. If it comes our way, we will freeze it. If there is anything else we can help with, please let us know. We deal with these often, and have Law Enforcement (LE) relationships worldwide.”
Some in the crypto space have speculated that lax security may be to blame for the loss.
In a January 1 Reddit thread, a user calling themselves SatStandard said that Dashjr might not have taken the November 17 security breach “seriously enough” and later suggested that the Bitcoin core developer “did not keep different activities separated.”
“He had a hot wallet on the same computer he did everything else. It looks like he was really complacent.”
In the meantime, a few others seem to suggest it may not have been a hack at all, saying that somebody had stumbled across the seed phrase somehow, or it was part of an unfortunate ‘boating accident’ ahead of tax season.
A boating accident in this context refers to a running joke and meme originally used by gun enthusiasts, but since repurposed by the crypto community about people aiming to avoid paying taxes by alleging that they lost all their BTC in a “tragic boating accident.”
Top tier boating accident. 
— Nate (@beeforbacon1) January 1, 2023
Reporters reached out to Dashjr over Twitter for more information about the alleged hack but never heard back from him by the time of publication.
That news also ignited a debate around self-custody, which became a hot topic after the collapse of FTX in 2022.
Binance’s Zhao, who previously cautioned the general crypto community about self-custody, stated:
“Sad to see even an OG #Bitcoin Core Developer lost 200+ BTC ($3.5 million). Self-custody [has] a different set of risks.”
Online social media BTC influencer Udi Wertheimer also took some time to question whether self-custody was a viable and safe option, commenting that one “shouldn’t manage your own keys.”
He stated:
“If even one of Bitcoin’s OG developers messes this up, I really don’t know how other people are expected to do it safely. That’s not to say self-custody is bad. But you shouldn’t manage keys directly.”
