Unsafe Self-Custody Practices
Brazilian cryptocurrency streamer Fraternidade Crypto is the latest victim of unsafe self-custody practices, reportedly losing thousands of dollars due to a private key accident. During a live stream on YouTube, the channel's owner inadvertently exposed his private key, leading to the theft of his funds.
Unfortunate Mistake
During the live stream, the streamer accidentally revealed his private key while trying to access his passwords for blockchain games platform Gala Games. Unfortunately, his Gala Games passwords were stored in the same text file as the seed phrase for his MetaMask wallet, which held a significant amount of Polygon (MATIC) tokens.
Quick Actions
Although the streamer closed the live stream shortly after opening the text file, it was already too late to recover the funds. One of his viewers managed to access his MetaMask wallet using the exposed private key and stole his entire stash of 86,000 MATIC, worth around $50,000 at the time.
Desperate Plea
In an emotional video following the accident, the streamer revealed the Polygon address of the unknown perpetrator. He claimed to have lost his entire life savings and pleaded with the viewers to return the money for a reward. He also planned to file a complaint with local police.
Some Funds Recovered
According to online sources, Fraternidade Crypto may have managed to retrieve at least some of his funds. A local crypto executive reported rumors that the streamer was able to recover a "good part of the money."
Importance of Self-Custody Security
This incident highlights the importance of taking extreme care when it comes to self-custody of cryptocurrencies. Users should avoid storing their private keys and passwords on their computers or in easily accessible places. Diversifying the types of cryptocurrency storage can also help prevent the loss of one's entire life savings.
Risks of Self-Custody
While self-custody allows users to have full control over their funds, it also comes with risks such as theft, destruction, or loss. The popular expression "not your keys, not your coins" emphasizes the need to protect private keys. Once a private key is exposed, the owner is no longer the rightful owner of the funds according to the rules of the crypto world.
