Silk Road 2 Hacked, Over 4,000 Bitcoin Allegedly Stolen

Silk Road 2 moderator Defcon reported in a forum post that hackers have used a transaction malleability exploit to hack the marketplace. The hackers stole over 88,000 4474.26 bitcoins worth $2,747,000, emptying the site’s escrow account.

The site used a central escrow service to send bitcoins from buyers to sellers. The hackers exploited the transaction malleability bug – essentially a way users can mask transfers and ask for the same amount of BTC multiple times – to clean out this wallet. This is the same bug that forced Mt. Gox to halt all withdrawals and recent updates have made average bitcoin wallets secure against this sort of attack. According to the site, hackers used the Silk Road’s automatic transaction verification system to order from each other and then request refunds for unshipped goods. Hackers were able to use the transaction malleability bug because the Silk Road used only transaction ID to confirm the transfer of bitcoins. You can read more about the problem here.