Bitcoin Gold users lost more than $2.5M

Bitcoin Gold users accuse BTG team in fraud; let's try to figure out, what happened
22 November 2017   16184

On the night of November 13-14, more than 3200 user wallets were devastated by hackers as a result of the vulnerability of the only available at that time BTG wallet called Mybtgwallet. According to preliminary calculations, the losses amounted to 300 BTC and 300 BTG, which exceeds $ 2.5 million, one of the representatives of the affected users Levin Vadim told  russian news website ForkLog.

A group of injured users (120+ people) was organized in Slack Channel by an activist under the name Concorde. They are convinced that even if the Bitcoin Gold team is not directly involved in the fraud, it has provided the attackers with everything they need to steal coins, which makes it equally guilty.

It is known that the Bitcoin Gold team has attracted a third party to develop an appropriate ecosystem in the form of an electronic wallet to generate a BTG address. This third person was the developer John Dass, who in the official slough of the Bitcoin Gold project received the status of "DEVELOPER" and openly urged all users to choose his wallet. It is worth noting that the team BTG confirmed cooperation with John Dass, and Mybtgwallet called a safe and non-fake wallet.

Bitcoin Gold Slack
Bitcoin Gold Slack

When the BTG network started, Mybtgwallet was the only way to generate the BTG address for the miners, except downloading the full node to your server. The weight of the full node was 147 GB, and downloading it was very problematic for many, respectively, they generated the address through the wallet, where it was necessary to enter the seef-phrase from the BTC-purse.

My BTG wallet
My BTG wallet 

Also, we can the reply of official Bitcoin Gold twitter account.

Bitcoin Gold Twitter
Bitcoin Gold Twitter

One of the affected users assume that the attackers had access to the seed-phrases and took advantage of this to steal the funds.

On Sunday, November 12, representatives of Bitcoin Gold announced the launch of a wallet in their channels.

Bitcoin Gold Twitter reply
Bitcoin Gold Twitter reply

users claim that approximately a month before the start of the main network Bitcoin Gold site was hacked and the attackers replaced the official Twitter address with a fake one. There were no statements from the developers on this matter. Maybe they were afraid of negative public opinion on the threshold of the launch and concealed this fact from the community.

According to the source, a group of eight people, under the auspices of the business angel, who heads the victims, is in talks with the developers. This group has set the following conditions for the Bitcoin Gold team and Jack Liao: "full refund at the rate of November 14-15, or lawsuits against Liao and each member of the team for aiding offense".

To fulfill the conditions, the developers were given only 24 hours. According to representatives of the initiative group for the return of funds, the BTG team informed them that at the moment it is cooperating with the FBI in order to return money.

Bitcoin Gold Slack
Bitcoin Gold Slack

On Tuesday, November 21, it has became known that a group of active users who had suffered as a result of fraudulent actions decided to stand on the warpath and sue the Bitcoin Gold team for assisting intruders who had disappeared from $ 2.5 million. Moreover, as they say, the representatives of the developers threatened them with a complete refusal of cooperation in case of disclosure of the situation in the media team does not support or condemn any of the conflict sides. We are trying to provide as objective information as possible.

Bitcoin Gold Hardfork to be Implemented

Modified Equihash-BTG algorithm was launched on block 536200
05 July 2018   1304

On block 536200 Bitcoin Gold network was transferred to the modified Equihash-BTG algorithm, not supported by classic ASIC-miners. This is the developers of crypto-currencies reported in the official blog.

Thus, the project promotes one of its main ideas, which consists in avoiding ASIC-mining.

According to the developers, the new algorithm includes personalization, which makes it difficult to redirect the power of mining through the markets of hashing capacities, which guarantees greater network security.

Also in the course of the hack, an improved difficulty adjustment algorithm (LWMA) was added, which will allow BTG to work faster, providing a more stable flow of blocks.

We thank them all for their hard work in recent days getting ready for this upgrade… and for dealing graciously with the few snags and hurdles that will inevitably come after an important Upgrade like this.

We know that this milestone isn’t an endpoint… it’s just a waypoint we pass along the way to better things. First, we’ll make sure everything continues to function as expected, and we’ll help the inevitable stragglers get on board with the new code… and then we have a whole bunch of new things we’re looking forward to sharing with the Community!

The Bitcoin Gold Organization

In early June, the Bitcoin Gold team said that updating the network will make the cryptocurrency less vulnerable to various hacker attacks. In May, an unknown miner, through a "51% attack" on the BTG network, stole about 388,000 coins from the exchanges.