How to lose the keys to bitcoin wallets



Programmer Stephen Thomas, a former manager of Ripple, has two attempts to guess the password that opens access to $ 220 million in Bitcoin.

The password is required to unlock the IronKey Portable USB Drive containing the 7,002 BTC wallet keys. Many years ago Thomas lost the piece of paper that contained the IronKey password. The drive gives 10 attempts, after which it encrypts its contents forever. Thomas has already used up eight attempts, all in vain.

“I lie in bed and think about it. Then I go to the computer with a new strategy, but it doesn’t work, and I again sink into despair, ”he said.

Thomas is not alone. According to the analytical company Chainalysis, of the 18.5 million existing bitcoins, 20% of the coins worth $ 140 billion can be considered lost. Wallet Recovery Services, a wallet restoration firm, said that against the backdrop of the recent rise in the price of bitcoin to new highs, 70 hits a day are received, which is three times more than the previous month.

“Over the past years, I have spent several hundred hours trying to get into these wallets,” said entrepreneur Brad Yaasar.

He has several computers containing thousands of bitcoins, which he mined in the early days of cryptocurrency. He, too, lost his passwords years ago and put the hard drives in sealed bags out of sight.

“I don’t want to remember every day that I have only a small part of what could have been, but I lost it,” he shared.

Diogo Monica, co-founder of cryptocurrency storage startup Anchorage, opened the firm in 2017 after helping a hedge fund regain access to bitcoin wallets. “Even advanced investors were completely unable to somehow organize the management of private keys,” he said.

Thomas stated that one of the reasons for his interest in bitcoin was the lack of control of the cryptocurrency by the state or any company. In 2011, when he was living in Switzerland, one of the early adopters of the cryptocurrency paid him 7,002 BTC for an animated video about bitcoin.

In the same year, he lost the keys to his wallet. As the price of bitcoin rose, Thomas began to question the idea that people should be their own banks: “Do you make shoes for yourself? Therefore, we also have banks so that we do not have to deal with all the things that they do. “

Barbados entrepreneur Gabriel Abed lost 800 bitcoins after a colleague formatted his laptop hard drive with wallet keys in 2011. However, Abed did not give up on cryptocurrency. Prior to that, he did not have access to financial products, including bank cards and accounts, and even opening a PayPal account in Barbados was then almost impossible.

“The risk of being my own bank for me is associated with the ability to freely access my money and be a citizen of the world. It’s worth it, ”Abed said.

Both Thomas and Abed subsequently earned large sums from cryptocurrency. Abed said that he has since been able to buy and sell a lot more bitcoins and as a result bought a 100-acre piece of land on the ocean coast in Barbados for more than $ 25 million. Thomas admits that he saved enough bitcoins to have more money than he does now. would know where to spend. He started working for Ripple in 2012 and has also received XRP rewards from the company.

Thomas put his IronKey in a secure vault, the location of which he refused to disclose, in case cryptographers come up with a new way to crack complex passwords. He claims that by moving the drive further away, he was able to stop thinking about it constantly. “I got to the point where I decided: Let it be a thing of the past, just for your mental health,” he added.

Recall that the crypto trader lost $ 1 million due to an error in the address.

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Karice Dabule

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