Former Ripple executive loses $ 220 million Bitcoin key

A former Ripple Labs executive is said to have lost over 7,000 BTC.

He says this experience marred his vision of a system without banks.

It is estimated that 20% of existing bitcoins would be irretrievably lost.

Stefan Thomas, of German origin and a former Ripple Labs executive, has almost certainly lost over 7,002 bitcoins (BTC), worth more than $ 220 million.

The programmer, who lives in San Francisco, is struggling to find rest despite the XRP tokens he was given in 2012 and whose value is unknown.

The anguish of a loss of $ 220 million

Does the parent in you “keep a hard copy of everything”? That said, few people regret not having listened to this advice as much as Stefan Thomas. According to the New York Times , Mr. Thomas, who held the private keys to his Bitcoin Revolution platform wallet inside an IronKey hard drive, would not remember the password.

The IronKey external drive is specially password protected and automatically blocks the user after ten failed attempts, forever encrypting the data it contains. Stefan Thomas has already made eight attempts (with his most common passwords) and only has two left.

Stefan Thomas has two tries to find a password worth around $ 220 million. This is one of the many people who find themselves deprived of their Bitcoin fortunes: The amount of funds locked in lost or stranded digital wallets is estimated at $ 140 billion.

Unfortunately, the programmer who now lives in California lost the paper he wrote his passwords on.

While he enjoys technology, knowing that he has hundreds of millions of dollars in BTC, but could never touch, constantly eats him away. He has said he will make a plan to release his bitcoin, but will be all the more disappointed when he realizes that it won’t work.

This experience tainted the idea that a person could become his own bank, which was the “original” vision of Satoshi Nakamoto’s white book .

“This idea of being your own bank… Let me tell you: do you make your own shoes?” said Thomas.

“The reason we have banks is because we don’t want to do all of these things that banks do.”

Bitcoin custodians as an alternative solution

However, there are some intermediate solutions. Some, for example, use insured depositories, such as BitGo . Others put their private keys in opaque folders, spread across different vaults, and then across an entire country (as the Winklevoss twins did, as described in the book Bitcoin Billionaires ).

However, a large number of people who want their bitcoins to be accessible by password then resort to exchanges. Exchanges are however exposed to the risk of hacking, the most infamous of which is Mt.Gox . Unless you have some sort of futuristic quantum computer , it’s next to impossible to hack into an offline storage cold wallet.