Bitcoin Data Loss Set To Cost Over £4 Million

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A discarded hard-drive may cost its owner over £4 million after he realised too late that it included 7,500 bitcoins.

IT worker James Howells built up a digital wallet of the virtual currency in 2009, at which time they were virtually worthless. He spent a short period of time 'mining' for them, a process that would now require vast computer power.

Mr Howells ceased using the laptop after a drink spillage, but he kept the hard drive in a desk until he threw it out in July or August 2013. Only afterwards did he realise it contained the bitcoins, which were worth around £500,000 then and have soared in value since.

The drive now lies somewhere in a huge landfill site in south Wales. Mr Howells told the Guardian: "You know when you put something in the bin and, in your head, say to yourself 'that's a bad idea'? I really did have that." He added that he is now "resigned" to never getting the drive back.

It is a story that may have lessons for individuals and businesses alike. Although the drive is secured with a 'key' so nobody else can access the data, Mr Howells did not back it up. Similarly, companies who fail to duplicate their own data may end up losing money or important information themselves if a drive or disc is lost, stolen or – as in this case – carelessly discarded.

Fires are another potential cause of data being lost, but one recent incident showed how having backed-up files means even such a disaster will not wipe out secure data.

Earlier this month, a blaze broke out at the Internet Archive's San Francisco Scanning Centre Some paper material that was yet to be digitised was lost, but half of the paper destroyed had already been saved into electronic form.

In a blog, the company said the event demonstrated the value of copying and remote storage. It stated: "We have copies of the data in the Internet Archive in multiple locations, so even if our main building had been involved in the fire we still would not have lost the amazing content we have all worked so hard to collect."

Storetec News/Blogs."http://www.storetec.net/news-blog/bitcoin-data-loss-set-to-cost-over-4-million/". Bitcoin data loss set to cost

over £4 million. November 29, 2013. Storetec.