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Bitfloor Back in Business

Op-ed - Bitfloor Back in Business

Mihai Alisie (left) conducting an interview with Roman Shtylman (right), the founder of Bitfloor, to be published in an upcoming article.

Bitfloor, a New York based Bitcoin exchange, is now back up and running after a thief stole $250,000 worth of Bitcoins[1]from a backup on one of its servers. Roman Shtylman, the founder and operator of Bitfloor, wrote a blog post[2]promising that he is still working to return users Bitcoin funds, but that it was important to get the exchange back up and running quickly so as to not erode confidence in the continuation of the exchange any further.

Currently, any Bitcoin balances held prior to the hack are on “hold” status within the exchange. They cannot be traded or withdrawn.

The plan to return users funds currently rests on the profitability of the exchange – as profits are generated, Shtylman plans to distribute some or all of them towards releasing the Bitcoin balances currently on hold. Each user will have the same percentage of their balances released any time a dispersal is made.

Shtylman also mentioned he was pursuing potential options with investors to pay back users sooner rather than later, though no specific timeline was given in either case.

The security of Bitfloor has reportedly been heavily solidified. No longer will any customer funds be risked in a hot wallet on the server – 100% of customer funds will be placed in cold storage. Bitfloor will still operate a hot wallet, but it will only risk its own funds, not any customer funds. The REST API has been bulletproofed with a secondary passphrase to prevent unauthorized withdrawals from customer accounts. Bitfloor’s servers now reside in a PCI-compliant data center, with disk encryption making the drives useless to anyone attempting a theft while physically at the location. And, perhaps most importantly, all backups are now encrypted.

Roman ends his blog post with the following message to his customers:

“I am committed to keeping Bitfloor alive, strong, and growing for the bitcoin ecosystem. I would like to say thank you to all of the support I have received pressing for the return of Bitfloor and the service it provided. Bitfloor will continue to excel in both service and quality as it goes forward.”

Do you have Bitcoin balances on hold at Bitfloor? Do you expect Roman to keep his word and pay them back?