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Karpeles said last winter that they were going to make their keys more secure by breaking them into pieces using a Shamir's secret sharing algorithm. This would allow a key to be more secure because it would take several pieces, but not all of them, to reconstitute the private key.

My assumption is that they either made a mistake with the algorithm, or they lost enough chunks of the keys that they can't reconstitute the private key. This could have been as simple as a banks safety-deposit box being inaccessible because it's seized or losing the pieces.

If they were stored digitally, it could be as simple as a media problem (Organic dyes in CDR's degrade. USB drives aren't infallible, etc).

The reason they got this wallet open is because they probably recovered the private key in some ancient backup they forgot they had from before they split the keys into pieces and deleted what they thought were the only copies of the unsecured keys.

This is just my completely unsubstantiated theory, but it seems to match the current facts.



Mark stated that the missing coins were most likely lost due to transaction malleability. I don't know why he would risk lying for no good reason.


The 'good' reason would be the 400 Million dollars...

Not saying he is or isnt lying, but we cant just throw around the 'there is no good reason for him to say xyz' in this situation...


Yes, that's what I meant: stealing them would have been a good reason to lie but covering up a form of negligence (media failure) with another form of negligence (transaction malleability), which was the theory I was trying to refute, doesn't seem especially useful (hence the "no good reason to lie").




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