You might have read online that the FBI "hacked" Bitcoin in order to retrieve stolen coins from a ransomware group. The news might have made you panic-sell your crypto, like it did others. After all, if the FBI can hack Bitcoin wallets at will, then Bitcoin is severely compromised.
The problem here is the word "hack." In the context of crypto, it can refer to two different things.
First, using the real-world definition, it means that the FBI has access to a futuristic supercomputer that can break Bitcoin's fundamental encryption. If that's what happened, it's great cause for concern, not just for Bitcoin, but for internet and software systems around the world. Major tech companies and countries like Russia, China, and Iran would be scrambling to protect themselves from incursion. It would be akin to the U.S. admitting to having a space laser. Does the U.S. have a space laser? If they did, they wouldn't use it on some two-bit operation and brag about it to the press; they'd make its secrecy priority #1.
The second definition of "hack" is what actually happened. That the ransomware group messed up and put their Bitcoin somewhere that they shouldn't have and the FBI took advantage of their oversight. Such a seizure would have nothing to do with Bitcoin's technology and everything to do with how well the ransomware group protected themselves. It's the difference between picking a lock and tricking the person on the other end into opening their door.
Sloppy reporting that turns into wildfire rumors that turns into market drops is par for the course in cryptocurrency, because it helps media companies win eyeballs and helps large crypto investors drive the price down to re-buy for cheap. Whether it's the annual "China Bans Crypto" headline or vague accusations that Bitcoin had a "doublespend" attack, the thing to remember is not to overreact.
One final thought: even if someone hacked Bitcoin, it wouldn't be the end of Bitcoin. The price would plummet in the short-run, but the industry would freeze everything, institute an upgraded Bitcoin that every existing holder would receive, and continue on. We've seen this same process play out many, many times before with other cryptocurrencies.
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