Swiss entrepreneur’s $243m Bitcoin drama

On Oct 25, 2023

Crypto entrepreneur faces a $243 million Bitcoin dilemma, with just two password attempts left and a reluctant decision on accepting Unciphered’s hacking expertise.

Over the years, the crypto industry has seen many stories of users buying thousands of Bitcoins over a decade ago, when it was worth merely $10-$13, only to lose access to their wallet today when the leading cryptocurrency is worth 3,000 times more. The story of Stefan Thomas, a Swiss crypto entrepreneur, follows a similar plot but has come across a rather surprising turning point.

Thomas holds 7,002 Bitcoins in an IronKey USB, which is a portable USB storage with secured encryption. These assets are worth more than $243 million today. However in a rather unfortunate scenario, Thomas has lost his password and only has two password attempts left before the USB drive erases the Bitcoin wallet keys. The only one that can help Thomas is Unciphered, a hacker group that has developed a technique to crack the passwords of IronKey S200 devices. The only problem is that Thomas doesn’t want their help.

In 2011, Stefan Thomas lost the password to an IronKey S200, an encrypted USB drive holding 7,002 bitcoins. IronKeys are designed to permanently erase their contents if someone tries ten incorrect password guesses, and Thomas has already tried eight wrong ones.
🎥 Unciphered pic.twitter.com/gK80KJQ9GJ
— WIRED (@WIRED) October 25, 2023

IronKeys are designed to permanently erase their contents after ten incorrect password guesses. Unciphered’s hackers have confirmed to the WIRED that they can bypass this limitation, giving them virtually infinite tries to guess the password. They’ve demonstrated their capabilities, unlocking an IronKey in what they dubbed “Project Everest.”

Despite Unciphered’s success and offer to help, Thomas has declined their assistance, remaining committed to two other teams he had engaged earlier. Unciphered has not disclosed the specifics of their cracking technique due to potential national security implications. They have managed to decrypt 2011-era IronKeys more than a thousand times, demonstrating a non-destructive, reliable method.

Despite their technological triumph, convincing Thomas to use their services has proven to be a challenge, leaving Unciphered with a powerful decryption tool but no agreement to unlock the high-value cryptocurrency treasure.

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