The $14 Billion Bitcoin Heist: How One Hacker Engineered the 2020 Crypto Hack of the Decade

A digital cat-and-mouse game—with a $14 billion prize. Here’s how an anonymous hacker outsmarted the system in the largest Bitcoin theft of 2020.

The Attack: No Firewall Could Stop This

Exploiting a vulnerability even the devs missed, the attacker bypassed security protocols like they were wet tissue paper. Two-factor authentication? More like two-step inconvenience.

The Aftermath: Crypto’s ‘Trustless’ Paradox

While blockchain evangelists preached ‘code is law,’ the hacker proved code is just… code. The stolen stash—now worth enough to buy a small country—still floats in the crypto ether, untouchable. (Cue Wall Street bankers smugly adjusting their pinstripes.)

The Irony

Five years later, the hack remains a brutal reminder: in crypto, the biggest risks aren’t market crashes—they’re the humans (or lack thereof) behind the keyboards.

How the LuBian hack happened

Arkham’s analysis suggests LuBian may have been using a weak private key generation method at the time, one vulnerable to brute-force attacks. The hacker likely exploited this flaw in the system, draining over 90% of the pool’s BTC in two days.

On December 31, LuBian tried to secure its remaining assets by moving them to recovery wallets. They also attempted to contact the hacker directly, by using the Bitcoin OP_RETURN function to embed pleas into blockchain transactions.

The company spent roughly 1.4 BTC to send over 1,500 messages to the hacker, begging for the stolen BTC to be returned. However, all that effort failed, and the hacker still holds the stolen coins. Most of this has remained untouched for years, except for a recent wallet consolidation in July 2024.

Arkham added that LuBian managed to retain about 11,886 BTC, now worth $1.35 billion. But with Bitcoin’s price rising since 2020, the value of the stolen stash has ballooned to roughly $14.5 billion, making the hacker one of the largest BTC holders on Arkham’s database, ranking even ahead of the 2011 Mt. Gox attacker.

Hacks and scams have long remained a persistent problem for the crypto industry. So far this year, over $3.1 billion has been lost to a mix of major exchange breaches, protocol exploits, and phishing attacks. 

With losses piling up year after year, pressure is mounting for stronger security measures, especially as attackers grow more sophisticated with advancing technology.