‘Bitcoin Family’ modified security after recent crypto kidnappings

A wave of high-profile kidnappings targeting cryptocurrency executives has rattled the industry — and prompted a quiet security revolution amongst a few of its most visible evangelists.

Didi Taihuttu, patriarch of the so-called “Bitcoin Family,” said he overhauled the family’s entire security setup after a string of threats.

The Taihuttus — who sold the whole lot they owned in 2017, from their house to their shoes, to go all-in on bitcoin when it was trading around $900 — have long lived on the periphery of crypto ideology. They travel full-time with their three daughters and remain entirely unbanked.

Over the past eight months, he said, the family ditched hardware wallets in favor of a hybrid system: Part analog, part digital, with seed phrases encrypted, split, and stored either through blockchain-based encryption services or hidden across 4 continents.

“We now have modified the whole lot,” Taihuttu told CNBC on a call from Phuket, Thailand. “Even when someone held me at gunpoint, I am unable to give them greater than what’s on my wallet on my phone. And that is not rather a lot.”

CNBC first reported on the family’s unconventional storage system in 2022, when Taihuttu described hiding hardware wallets across multiple continents — in places starting from rental apartments in Europe to self-storage units in South America.

As physical attacks on crypto holders change into more frequent, even they’re rethinking their exposure.

This week, Moroccan police arrested a 24-year-old suspected of orchestrating a series of brutal kidnappings targeting crypto executives.

One victim, the daddy of a crypto millionaire, was allegedly held for days in a house south of Paris — and reportedly had a finger severed through the ordeal.

In a separate case earlier this yr, a co-founder of French wallet firm Ledger and his wife were abducted from their home in central France in a ransom scheme that also targeted one other Ledger executive.

Last month in Latest York, authorities said, a 28-year-old Italian tourist was kidnapped and tortured for 17 days in a Manhattan apartment by attackers attempting to extract his bitcoin password — shocking him with wires, beating him with a gun, and strapping an Apple AirTag around his neck to trace his movements.

The common thread: The pursuit of crypto credentials that enable fast, irreversible transfers of virtual assets.

“It is certainly frightening to see a number of these kidnappings occur,” said JP Richardson, CEO of crypto wallet company Exodus. He urged users to take security into their very own hands by selecting self-custody, storing larger sums on hardware wallets, and — for those holding significant assets — exploring multi-signature wallets, a setup typically utilized by institutions.

Richardson also really helpful spreading funds across different wallet types and avoiding large balances in hot wallets to scale back risk without sacrificing flexibility.

That rising sense of vulnerability is fueling a brand new demand for physical protection with insurance firms now racing to supply kidnap and ransom (K&R) policies tailored to crypto holders.

But Taihuttu is not waiting for corporate solutions. He’s opted for complete decentralization — of not only his funds, but his personal risk profile.

Because the family prepares to return to Europe from Thailand, safety has change into a continuing topic of conversation.

“We have been talking about it rather a lot as a family,” Taihuttu said. “My kids read the news, too — especially that story in France, where the daughter of a CEO was almost kidnapped on the road.”

Now, he said, his daughters are asking difficult questions: What if someone tries to kidnap us? What is the plan?

Though the women carry only small amounts of crypto of their personal wallets, the family has decided to avoid France entirely.

“We got a bit of bit famous in a distinct segment market — but that area of interest is becoming a very big market now,” Taihuttu said. “And I believe we’ll see increasingly of those robberies. So yeah, we’re definitely going to skip France.”

Even in Thailand, Taihuttu recently stopped posting travel updates and filming at home after receiving disturbing messages from strangers who claimed to have identified his location from YouTube vlogs.

“We stayed in a really beautiful house for six months — then I began getting emails from individuals who found out which house it was. They warned me to watch out, told me not to go away my kids alone,” he said. “So we moved. And now we do not film anything in any respect.”

“It’s an odd world in the intervening time,” he said. “So we’re taking our own precautions — and in relation to wallets, we’re now completely hardware wallet-less. We do not use any hardware wallets anymore.”

The family’s latest system involves splitting a single 24-word bitcoin seed phrase — the cryptographic key that unlocks access to their crypto holdings — into 4 sets of six words, each stored in a special geographic location. Some are kept digitally through blockchain-based encryption platforms, while others are etched by hand into fireproof steel plates using a hammer and letter punch, then hidden in physical locations across 4 continents.

“Even when someone finds 18 of the 24 words, they cannot do anything,” Taihuttu explained.

On top of that, he’s added a layer of private encryption, swapping out select words to throw off would-be attackers. The tactic is straightforward, but effective.

“You simply need to recollect which of them you modified,” he said.

A part of the rationale for ditching hardware wallets, Taihuttu said, was a growing mistrust of third-party devices. Concerns about backdoors and distant access features — including a controversial update by Ledger in 2023 — prompted the family to desert physical hardware altogether in favor of encrypted paper and steel backups.

While the family still holds some crypto in “hot” wallets — for every day spending or to run their algorithmic trading strategy — those funds are protected by multi-signature approvals, which require multiple parties to log out before a transaction might be executed.

The Taihuttus use Protected — formerly Gnosis Protected — for ether and other altcoins, and similarly layered setups for bitcoin stored on centralized platforms like Bybit.

About 65% of the family’s crypto is locked in cold storage across 4 continents — a decentralized system Taihuttu prefers to centralized vaults just like the Swiss Alps bunker utilized by Coinbase-owned Xapo. Those facilities may offer physical protection and inheritance services, but Taihuttu said they require an excessive amount of trust.

“What happens if one in every of those corporations goes bankrupt? Will I still have access?” he said. “You are putting your capital back in another person’s hands.”

As an alternative, Taihuttu holds his own keys — hidden across the globe. He can top up the wallets remotely with latest deposits, but accessing them would require a minimum of one international trip, depending on which fragments of the seed phrase are needed. The funds, he added, are intended as a long-term pension to be accessed provided that bitcoin hits $1 million — a milestone he’s targeting for 2033.

The shift toward multiparty protections extends beyond just multi-signature. Multi-party computation, or MPC, is gaining traction as a more advanced security model.

As an alternative of storing private keys in a single place — a vulnerability often called a “single point of compromise” — MPC splits a key into encrypted shares distributed across multiple parties. Transactions can only undergo when a threshold variety of those parties approve, sharply reducing the danger of theft or unauthorized access.

Multi-signature wallets require several parties to approve a transaction. MPC takes that further by cryptographically splitting the private key itself, ensuring that no single individual ever holds the complete key — not even their very own complete share.

The shift comes amid renewed scrutiny of centralized crypto platforms like Coinbase, which recently disclosed a data breach affecting tens of 1000’s of consumers.

Taihuttu, for his part, says 80% of his trading now happens on decentralized exchanges like Apex — a peer-to-peer platform that permits users to set buy and sell orders without relinquishing custody of their funds, marking a return to crypto’s original ethos.

While he declined to disclose his total holdings, Taihuttu did share his goal for the present bull cycle: a $100 million net price, with 60% still held in bitcoin. The remaining is a mixture of ether, layer-1 tokens like solana, link, sui, and a growing variety of AI and education-focused startups — including his own platform offering blockchain and life-skills courses for youths.

These days, he’s also considering stepping back from the highlight.

“It’s really my passion to create content. It’s really what I really like to do each day,” he said. “But when it is not protected anymore for my daughters … I really want to take into consideration them.”

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