Hacker Claims Responsibility for $50 Million Bitcoin Heist

Theodore Price, a resident of Bucks County, Pennsylvania was arrested earlier today after a criminal complaint had been filed against him alleging he stole between $40-$50 million in Bitcoin by creating malware ridden bitcoin wallets and distributing them on the bitcointalk forums.

The investigation started because of an alleged theft. According to his girlfriend, Price stole two laptops and a gold necklace from her parents’ residence when they were out on vacation. As police arrived to search the suspect’s apartment, they stumbled upon stolen personal information and credit card numbers with the girlfriend’s family members’ names on them.

After his arrest, Price admitted to investigators that he was running a phishing scheme. Specifically, he compiled rogue bitcoin wallets and distributed them on specific bitcoin forums. Bitcointalk.org is notorious for scammers and hackers constantly trying to trick users into clicking their links so more likely than not the software was distributed on those forums. One of Price’s Bitcoin wallets contained roughly $35 million in stolen funds, he even told investigators that he was planning to launder the money to make it spendable.

While Price was initially charged with the appropriate charge of “unauthorized access to a computer for personal financial gain between $40-50 million,” the charges were subsequently dropped according to assistant U.S. Attorney Lesley Bonney. While it is unclear why the charge was dropped, it is obvious that Price fully cooperated with police and gave up his bitcoin wallets. After all, seizing $40 million in cryptocurrency in exchange for a plea deal doesn’t seem like such a bad deal.

The real question is why in the world did Price steal his girlfriend’s parents property when he was sitting on millions dollars worth of cryptocurrency? According to the complaint, Price sold his girlfriend’s laptop for $150 at a computer store and had the rest of the stolen property in his possession.

According to Emin Fun Sirer, a Cornell University computer science professor:

“The bitcoin ledger is public, it’s virtually impossible to spend large amounts of stolen bitcoin without being noticed. Most hackers use a process called “tumbling” to launder stolen bitcoin by intermingling it with other people’s transactions, but the complaint says Price didn’t have a chance to do that. It makes sense that someone could steal $40 million, but not be able to pull it out.”

However, I would argue that Price could have easily separated a smaller portion of his bitcoins into a different wallet which wouldn’t link to the main one, then tumble the small amount of bitcoins and spend them to his heart’s content.

I believe the real reason why Price stole property from his girlfriend’s parents’ house stems from either personal or relationship issues. Maybe Price was mad at his girlfriend for something she did, maybe he didn’t like her parents and wanted to get revenge on them. It is also surprising that he would create fraudulent credit cards under their names when he could have used the name of any other random person.

At the end of the day, Karma is a bitch, the tables turned and instead of making $150 from innocent people he just caught a charge and lost over $40 million to the federal government.