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Men Exploit Bitcoin ATMs in Canada for $200,000

14 March 2019

The fact of the matter remains that cryptocurrency of any kind is susceptible to double-spending, including bitcoin.

According to reports by CBC, double-spend attacks have taken place against Bitcoin ATMs in four Canadian cities.

Calgary Police say officers received information in October 2018 about multiple fraudulent transactions made across the country that specifically targetted one Canadian bitcoin company.

Between Sept. 16 and 26, four men were captured on CCTV cameras making 112 withdrawals from Bitcoin kiosks in seven Canadian cities.

The men's identities are still unknown, therefor the Calgary police made a decision to turn to the public to ask for help in identifying the criminals.

Bitcoin ATMs have been growing in number across the world, with over 4,000 already in operation.

This man is suspected of making fraudulent transactions in Toronto, Montreal, Ottawa and Hamilton.

Police say the suspects were committing "double-spend" attacks - a type of fraud where someone withdraws money from a Bitcoin kiosk before remotely cancelling the transaction before the Bitcoin company can process the transaction. The tools themselves weren't created for such activities, but allow for "stuck" transaction to go through using additional fees. In addition, you can optionally specify that the first transaction additional OP-RETURN, multisig, and "blacklisted" address outputs.

Police are asking anyone who can identify the suspects to call the Calgary Police Service at 403-266-1234, regardless of where they live in, or contact Crime Stoppers if they wish to remain anonymous.

Four suspects have been caught on surveillance footage, and are all described as adult men who likely have in-depth knowledge in cryptocurrency, bitcoin, and blockchain technology.

Authentic double spend attacks either involve exploiting a code defect in a crypto network's software or a "51% attack"(brute force attack) on a cryptographic ledger's processing of transactions.

Men Exploit Bitcoin ATMs in Canada for $200,000