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Comment by teraflop | Hacker News Reader

Someone on bitcointalk.org [1] noticed that approximately 42,000 BTC (currently worth about US$4.3 million) was just transferred out of one of Instawallet's accounts [2]. No idea whether the transaction was Instawallet's doing, or the attacker's.

[1] https://bitcointalk.org/index.php?topic=164143.msg1716794#ms...

[2] http://blockchain.info/address/1LrPYjto3hsLzWJNstghuwdrQXB96...

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It's worth noting that the transfer took place two hours before the site was taken down. That's a really bad sign.

Ah wait a minute. That address is worth $4.3m, but the number of coins transfered from Instawallet cold storage is $1.5m. There are three transactions. One is old. Two are new, and only one of the new ones is labeled as "Instawallet Cold Storage".

One of the other addresses in that list has a history of moving around thousands of BTC. Perhaps it's all some sort of behind-the-scenes Instawallet address.

http://blockchain.info/address/1BcCo1dNztEjMtzxFTbtQuZEuK1Nk...

Very well could be. That address also received a large amount of coins from the cold wallet on the 18th.

http://blockchain.info/tx/f0dba606f4d245c49a165035eabe345794...

UH OH

Says it was sent FROM cold storage that's not a good sign.

If it's actual cold storage, then it's probably just them taking precautions. The whole point of cold storage is to make the wallet immune to a server breach. But who knows? It sounds like their security was sloppy.

Edit..

[Apr-1 10:30 CET] Bitcoin-Central and Paytunia update: Our customer's bitcoins and euros are safe and will not be affected by the security breach. We have taken the websites off-line for proper investigation.

The address 1LrPYjto3hsLzWJNstghuwdrQXB96KbrCy is under our exclusive control.

from https://bitcoin-central.net/

All is fine then I guess

how is bitcoin anonymous if someone is able to find out where money was able to be transferred out of so easily ?

You can't prevent double spending without being able to track where individual coins go. So we can know that X BTC went from wallet A to wallet B. Bitcoin is anonymous in the sense of linking owners to wallets. Even if someone asks to send Y bitcoins to wallet C as payment for something, you can't know from the wallet address where the wallet is stored or even if it isn't the wallet of a third party to whom that someone owes bitcoins.

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