Bitcoins Holders Stolen At Gunpoint - Essay Example

New York Police reported several incidents where bitcoins were stolen at gunpoint from victims. It is new for the internet-based currency.

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Crimes related to digital currency bitcoin are usually different from old-fashioned stick-up.

Just when the industry people were growing accustomed to crimes like shady internet dealings, some cases were reported that bitcoins were stolen at gunpoint in NY.

The latest bitcoin robbery report that police received is typical for this new kind of crime.

Dean Katz, a bitcoin seller had reported that a mugger recently forced him to transfer a huge quantity of bitcoins. He handed over bitcoins worth around $8,500 and additional $3,500 in cash.

A New City firefighter experienced a similar robbery. Dwayne Richards, who is a New York City firefighter, was on his way to Brooklyn when the incident took place. He was looking forward to meeting a person who wanted to exchange his bitcoins for cash.

Instead of conducting the transaction, he was mugged. He was stabbed too but he survived the attack. Richards is recovering well. The thief left with the bitcoins he was carrying. It seems unlikely that they will be recovered anytime soon.

The industry has grown used to hacking. Renowned bitcoin exchange Bitstamp faced a loss of around $5 million when 19,000 bitcoins were hacked from the system. It was a major loss but the industry expects crimes like that.

Stashes of the digital currency are often stolen from online repositories but stealing bitcoins at gunpoint is a new technique. Irrespective of the way it was conducted, the crime was serious.

The theft left police with very few leads, like most other incidents associated with bitcoin.

Even though bitcoin has earned recognition as a digital currency which is mostly used online, one of the most reliable ways to purchase and sell the currency using real money is to find someone in real life to exchange with.

There are many different services which connect bitcoin buyers and sellers. However, it is only recently that they have started attracting muggers of this kind.

The crypto currency could really make a enticing target for the more tech-savvy criminals. This is true even if the value of bitcoin has declined significantly.

When users transfer bitcoins, the movements of the virtual coins are visible in the blockchain. So everyone can witness transfer of ownership in the blockchain. However, as the system is fully anonymous, there is no way to find out who has the coins.

There is also no information about what happens to the coins after they are transferred few times.

As bitcoin is still in its early stage, it is expected to overcome all these security issues.

To conclude, it is important to take the time to double check the ID of the people you find to sell bitcoin for cash, via websites like Localbitcoins.

The best way is to use the third party services provided by such webstite or to meet them in a public area where you can check the cash like a bank lobby.