Inside the Bitcoin $10,000 Party, Apple’s Bungled Patch, Uber Security Exodus
The cryptocurrency investors’ summit I attended Tuesday could not have been better timed.
While the nouveau riche mingled and traded tips, the price of Bitcoin skyrocketed—no, spacerocketed—above $10,000 for the first time ever. The takeoff was a historic moment for an asset class that has been alternately described as a “fraud,” a “scam,” and a “bubble” by notable financiers in recent weeks. Just five years ago the digital money traded as low as $13.
As Bitcoin achieved liftoff, I was in the middle of interviewing Charles Hoskinson, an Ethereum cofounder who left the project early on, after disputes with the rest of the leadership team came to a head. Several investors interrupted our meeting at the Marriott Marquis in midtown Manhattan to inform Hoskinson that the market value of his latest cryptocurrency endeavors, Cardano and Ethereum Classic, had risen substantially. “You just made me a lot of money!” one of them said, enthusiastically patting the mathematician-turned-entrepreneur on the back.
At first Hoskinson appeared elated. But quickly, his smile gave way to circumspection. “We still have so much to do,” Hoskinson confided. “What goes up this fast can come down just as fast.”
Undiminished, the investor extended invitations to a late night “Bitcoin 10K” celebration on the rooftop of Public, a chic hotel in the Lower East Side. A few hours later, over thumping electronic beats at the venue, I polled party-goers on how they felt about the price explosion. Their answers: Mostly very, very good.
One guest told me his plan for a tokenized meme-sharing social network whose business model made as much sense to me as the sudden market spike. Another guest, a tax manager at State Street, one of the world’s biggest financial firms, looked at me wild-eyed and incredulous when I asked for his opinion. “This is a blip!” he said, a cocktail from the open bar sloshing in his hand. “This is nothing compared to where it’s headed!”
If you’re wondering where I stand on all this, I am enthusiastic—but highly cautious—about the prospect of cryptocurrencies, if not their present, speculative valuations. You can watch this clip of me weighing in about the boom on the floor of the New York Stock Exchange on Thursday. Or you can view this Fortune video in which I take up the bull argument in a debate with a colleague. My angle: If Bitcoin really should be considered as “digital gold,” as its proponents contend, then its price could soar much higher, nearing the value of the world’s gold supply.
Then again, the mania has all the hallmarks of a bubble. And as Hoskinson and Adam Lashinsky, your regular Data Sheet host, have pointed out: Bubbles burst.
Try not to beat yourself up about possibly missing out on the frenzy, and enjoy the weekend.
Welcome to the Cyber Saturday edition of Data Sheet, Fortune’s daily tech newsletter. Fortune reporter Robert Hackett here. You may reach Robert Hackett via Twitter, Cryptocat, Jabber (see OTR fingerprint on my about.me), PGP encrypted email (see public key on my Keybase.io), Wickr, Signal, or however you (securely) prefer. Feedback welcome.
Apple bungles "I am Root" bug. A software developer discovered a serious security flaw affecting Apple's macOS High Sierra operating system. The hole enables anyone to login into a computer with administrative privileges merely by typing in the user name "root," no password required. Apple issued a patch and an apology within 24 hours—although the patch doesn't stick if you update from High Sierra 10.13.0 to 10.13.1.
In honor of the meme-sharing entrepreneur at the Bitcoin 10K party I discussed above, below is a Guardians of the Galaxy-themed meme I made to commemorate Apple's fail.
Uber guards turn tail. Three senior managers on the beleaguered ride-hailing firm's security team resigned on Friday. The departures came a week after Uber's new CEO Dara Khosrowshahi revealed a previously undisclosed 2016 data breach—and concomitant cover-up—that affected 57 million customers. The security managers reported to Joe Sullivan, Uber's ex-security chief, before he was fired in the aftermath. Oh, and did I mention that the security team apparently had a unit devoted to stealing trade secrets? (Uber's chief lawyer has told people to stop doing that.)
Coinbase adds an operator. If you caught my colleague Jen Wieczner's deep dive into a rash of Bitcoin thefts affecting customers of Coinbase in the September issue of the magazine, then you'll know that the cryptocurrency broker has been struggling to keep up some basic business functions, like customer support. Partly to address those concerns, Coinbase has hired a new president and chief operating officer: Asiff Hirji, a former top executive at Hewlett Packard and TD Ameritrade. In related news, a court ruled this week that Coinbase must fork over to the IRS data for more than 14,000 customers for tax purposes.
Now you Siemens, now you don't. A federal court document unsealed Monday revealed that a U.S. jury has indicted three Chinese nationals for hacking and stealing intellectual property from several companies, including Siemens, Trimble, and Moody's Analytics. The defendants were employed by Guangzhou Bo Yu Information Technology Company, a Chinese cybersecurity firm.
Reminder: Do not bring the nation's closely guarded secrets home to help draft your resume.
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Just as gold bars are lost at sea or $100 bills can burn, bitcoins can disappear from the Internet forever. When all 21 million bitcoins are mined by the year 2040, the actual amount available to trade or spend will be significantly lower.
—Fortune's Jeff John Roberts got his hands on some exclusive research from Chainalysis, a digital forensics startup that studies the Bitcoin blockchain. The company estimates that 3.79 million bitcoins—that's about $38 billion's worth (assuming today's roughly $10,000 per Bitcoin price point)—have been lost forever.
Latest NSA Leak Reveals Secret Army Intelligence Project, by Don Reisinger
More Than a Third of Federal Websites Just Failed a Major Security Test, by Billy Perrigo
Crooks Cash in Stolen Rewards Points for Flights and Hotels, by Jeff John Roberts
North Korea Claims Its Newly-Tested Missile Can Reach the 'Whole' U.S., by Keshia Hennam
ONE MORE THING
Number theory and physics converge. Tracing trajectories of light-rays in the physical world could help mathematicians solve a longstanding problem in number theory: finding rational solutions—answers that can be expressed as fractions—to Diophantine equations, or algebraic expressions that have two or more unknown integer variables. (E.g., x^4 + y^4 = 1.) This might sound complicated, because it is. But if mathematicians start applying similar sorts of unconventional thinking to their studies—as Minhyong Kim, a mathematician at Oxford, advocates in this phenomenally lucid Quanta Magazine feature—the approach could help unravel the universe's most intransigent mysteries.