How this Bitcoin developer lost 25,000 BTC

Alinvin's journey in the early days of Bitcoin highlights the potential and inherent risks of the cryptocurrency market.

An early adopter and significant contributor to Bitcoin's growth, his experiences reflect the critical need for security measures. His story remains a reminder of the pitfalls faced by early adopters of Bitcoin.

Bitcoin developer lost 25,000 BTC

In the early days of Bitcoin, when the cryptocurrency was trading at less than $0.05, a developer known as ALLINVAIN mined and traded Bitcoin. In the year In 2010, he launched Bitcoin Express, one of the first Bitcoin exchanges to allow users to buy Bitcoin through PayPal.

Early transactions sell 1,000 BTC for just $5. At that time I was mining about 1,200 BTC per day on my laptop. However, the difficulty of mining changed in 2011 as more people joined the network.

“It's like everybody, their mom, their dad, their cousin, and their dog started mining,” Alinvan said.

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To support the Bitcoin economy, he started buying and selling real goods for Bitcoin as a buying agent for Canadian users who wanted to buy coffee cards. Having accumulated more than 25,000 BTC, he has earned the status of “Bitcoin whale” for his dedication to the Bitcoin economy.

In the year In early 2011, the price of Bitcoin rose to $30, marking the first significant bubble. Allynvin's holdings then increased to $500,000. However, his fortunes took a drastic turn on June 13, 2011, when he confirmed that 25,000 BTC had been traded without his permission.

“I'm in total grief today. I woke up to my huge bitcoin balance gone. If only the wallet file was encrypted in HD. I feel like it's my fault for not moving the money to another non-Windows computer,” he wrote.

The theft today is nearly $1.6 billion. He said his security was gone, suggesting that his unencrypted wallet file had been corrupted, possibly by a Trojan virus masquerading as mining software.

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News of the theft quickly spread worldwide, with Forbes covering it, naming it the first major bitcoin theft. Conspiracy theories abound, speculating that Alinvin orchestrated the theft. But he admitted it was his own fault, blaming it on lax security measures.

Despite the loss, ALLINVAIN remained active in the Bitcoin community, eventually starting a hosted mining business to rebuild its holdings. His experience serves as a great reminder to Bitcoin users of the importance of protecting private keys offline and maintaining private security protocols.