They Cracked the Code To a Locked USB Drive Worth $235 Million in Bitcoin. Then It Got Weird.
Unciphered, a Seattle-based startup, claims to have cracked the seemingly unbreakable encryption of IronKey S200, a decade-old USB thumb drive. By exploiting an undisclosed vulnerability in the device, the company says it can bypass the drive's feature that erases its contents after 10 incorrect password attempts. The breakthrough came within a day of receiving a test device, suggesting that the firm's hacking technique, powered by high-performance computing, could have far-reaching implications. The startup's focus is not just technological; it's after a specific IronKey that holds 7,002 bitcoins, valued at roughly $235 million, stored in a Swiss bank vault. The device belongs to Stefan Thomas, a Swiss crypto entrepreneur, who has forgotten the password and has only two password attempts left before losing access to his fortune. Unciphered believes its hacking capabilities could unlock Thomas' crypto vault and is preparing to reach out to him to offer its services. The only problem: Thomas doesn't seem to want their help. Wired: Earlier this month, not long after performing their USB-decrypting demonstration for me, Unciphered reached out to Thomas through a mutual associate who could vouch for the company's new IronKey-unlocking abilities and offer assistance. The call didn't even get as far as discussing Unciphered's commission or fee before Thomas politely declined. Thomas had already made a "handshake deal" with two other cracking teams a year earlier, he explained. In an effort to prevent the two teams from competing, he had offered each a portion of the proceeds if either one could unlock the drive. And he remains committed, even a year later, to giving those teams more time to work on the problem before he brings in anyone else -- even though neither of the teams has shown any sign of pulling off the decryption trick that Unciphered has already accomplished. That has left Unciphered in a strange situation: It holds what is potentially one of the most valuable lockpicking tools in the cryptocurrency world, but with no lock to pick. "We cracked the IronKey," says Nick Fedoroff, Unciphered's director of operations. "Now we have to crack Stefan. This is turning out to be the hardest part." In an email to WIRED, Thomas confirmed that he had turned down Unciphered's offer to unlock his encrypted fortune. "I have already been working with a different set of experts on the recovery so I'm no longer free to negotiate with someone new," Thomas wrote. "It's possible that the current team could decide to subcontract Unciphered if they feel that's the best option. We'll have to wait and see." In past interviews, Thomas has said that his 7,002 bitcoins were left over from a payment he received for making a video titled "What is Bitcoin?" that published on YouTube in early 2011, when a bitcoin was worth less than a dollar. Later that year, he told WIRED that he'd inadvertently erased two backup copies of the wallet that held those thousands of coins, and then lost the piece of paper with the password to decrypt the third copy, stored on the IronKey. By then, his lost coins were worth close to $140,000.
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