BREAKING: Chat with founder showcases alleged double withdraw and inefficient (or insecure) system

An IRC chat conversation leaked exclusively to CoinTelegraph has revealed a possible double withdraw issue at Bittrex.

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BREAKING: Chat with founder showcases alleged double withdraw and inefficient (or insecure) system

 

Bittrex is a cryptocurrency exchange that allows users to exchange Bitcoin and Litecoin for a wide variety of altcoins. We have received an anonymous tip from a trusted source of a leaked chat conversation allegedly from one of exchange's founding members.

 

We have removed the other user's username to protect his identity.

<@XXXXXXXXXX> <XXXXXXXXXX> heads up another 10k coming through :D

<@XXXXXXXXXX> <bittrex-richie_> leaving or coming? heh

<@XXXXXXXXXX> <bittrex-richie_> and as long as the wallet doesnt barf it should be fine

<@XXXXXXXXXX> <XXXXXXXXXX> leaving trex heading home to meet with its fam :P

<@XXXXXXXXXX> <bittrex-richie_> ;( sadness hhe.h.. i see it in the queue

<@XXXXXXXXXX> <bittrex-richie_> lets hope it processes

<@XXXXXXXXXX> <bittrex-richie_> i'm sur it will since the double pay went out without a hitch lol

<@XXXXXXXXXX> <XXXXXXXXXX> lol

<@XXXXXXXXXX> <bittrex-richie_> Flushing wallet.dat

<@XXXXXXXXXX> <bittrex-richie_> SendMoney() : Error: Transaction creation failed

<@XXXXXXXXXX> <bittrex-richie_> i was wrong

<@XXXXXXXXXX> <bittrex-richie_> meh.. fixing

<@XXXXXXXXXX> <XXXXXXXXXX> well crap lol

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<@XXXXXXXXXX> <XXXXXXXXXX> ok is this something that's on trex side or cloak wallet?

<@XXXXXXXXXX> <XXXXXXXXXX> doesnt seem like cloak is having any issues atm

<@XXXXXXXXXX> <bittrex-richie_> its our wallet.. because we have people mining into our wallet

<@XXXXXXXXXX> <bittrex-richie_> when we try to send out "large" transactions

<@XXXXXXXXXX> <bittrex-richie_> it has to collect a bunch of inputs

<@XXXXXXXXXX> <bittrex-richie_> and there is a max it can collect

<@XXXXXXXXXX> <bittrex-richie_> so when that hapoens we have to fix it

 

Bittrex richie is presumably Richie Lai, who according to Bittrex's website is one of the exchange's founders and works on Amazon's security.

Exchanges often control user funds in a giant pot similar to how a bank functions. So the movement of funds in this matter isn't out of the ordinary, but messing up on this scale will leave the exchange with less money than its customers have put into it. Earlier in the chat, bittrex-richie says this was the first time it happened, although the same user claims to have gotten more double spends credited to his account since.

This reporter spoke to bittrex-richie on the Bittrex IRC chatroom. He assured us that the funds in Bittrex are safe and secure. He says that the problem was caused when a transaction too large issue caused him to have to manually fix the transaction and then accidentally sent the additional funds to the user. He went on to say that the original poster's claims that it happened to again to the same user is false. The transaction too large issue has to do with the BTC protocol, but Coin Control is designed to fix just that. We were told that Bittrex does not use Coin Control and it has only had to manually fix the transaction a few dozen times since the start of Bittrex.

You can read our conversation, in its entirety here.

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