Theft and exchange shutdowns https://en.wikipedia.org/wiki/History_of_Bitcoin
Theft of bitcoin has been documented on numerous occasions. At other times, bitcoin exchanges have shut down, taking their clients' bitcoins with them. A Wired study published April 2013 showed that 45 percent of bitcoin exchanges end up closing.[111]
On 19 June 2011, a security breach of the Mt. Gox bitcoin exchange caused the nominal price of a bitcoin to fraudulently drop to one cent on the Mt. Gox exchange, after a hacker used credentials from a Mt. Gox auditor's compromised computer illegally to transfer a large number of bitcoins to himself. They used the exchange's software to sell them all nominally, creating a massive "ask" order at any price. Within minutes, the price reverted to its correct user-traded value.[112][113][114][115][116][117] Accounts with the equivalent of more than US$8,750,000 were affected.[114]
In July 2011, the operator of Bitomat, the third-largest bitcoin exchange, announced that he lost access to his wallet.dat file with about 17,000 bitcoins (roughly equivalent to US$220,000 at that time). He announced that he would sell the service for the missing amount, aiming to use funds from the sale to refund his customers.[118]
In August 2011, MyBitcoin, a now defunct bitcoin transaction processor, declared that it was hacked, which caused it to be shut down, paying 49% on customer deposits, leaving more than 78,000 bitcoins (equivalent to roughly US$800,000 at that time) unaccounted for.[119][120]
In early August 2012, a lawsuit was filed in San Francisco court against Bitcoinica тАФ a bitcoin trading venue тАФ claiming about US$460,000 from the company. Bitcoinica was hacked twice in 2012, which led to allegations that the venue neglected the safety of customers' money and cheated them out of withdrawal requests.[121][122]
In late August 2012, an operation titled Bitcoin Savings and Trust was shut down by the owner, leaving around US$5.6 million in bitcoin-based debts; this led to allegations that the operation was a Ponzi scheme.[123][124][125][126] In September 2012, the U.S. Securities and Exchange Commission had reportedly started an investigation on the case.[127]
In September 2012, Bitfloor, a bitcoin exchange, also reported being hacked, with 24,000 bitcoins (worth about US$250,000) stolen. As a result, Bitfloor suspended operations.[128][129] The same month, Bitfloor resumed operations; its founder said that he reported the theft to FBI, and that he plans to repay the victims, though the time frame for repayment is unclear.[130]
On 3 April 2013, Instawallet, a web-based wallet provider, was hacked,[131] resulting in the theft of over 35,000 bitcoins[132] which were valued at US$129.90 per bitcoin at the time, or nearly $4.6 million in total. As a result, Instawallet suspended operations.[131]
On 11 August 2013, the Bitcoin Foundation announced that a bug in a pseudorandom number generator within the Android operating system had been exploited to steal from wallets generated by Android apps; fixes were provided 13 August 2013.[133]
In October 2013, Inputs.io, an Australian-based bitcoin wallet provider was hacked with a loss of 4100 bitcoins, worth over A$1 million at time of theft. The service was run by the operator TradeFortress. Coinchat, the associated bitcoin chat room, has been taken over by a new admin.[134]
On 26 October 2013, a Hong-Kong based bitcoin trading platform owned by Global Bond Limited (GBL) vanished with 30 million yuan (US$5 million) from 500 investors.[135]
On 3 March 2014, Flexcoin announced it was closing its doors because of a hack attack that took place the day before.[136][137][138] In a statement that now occupies their homepage, they announced on 3 March 2014 that "As Flexcoin does not have the resources, assets, or otherwise to come back from this loss [the hack], we are closing our doors immediately."[139] Users can no longer log in to the site.