MARY LOUISE KELLY, HOST:
To the bizarre story now of an Italian man kidnapped and tortured for nearly three weeks in a townhouse in New York City in an effort to separate him from his fortune. Now, the would-be thieves were not after his worldly possessions - at least not tangible ones. They wanted his bitcoin password. Three people have now been arrested in this case, which is one of a growing number of violent physical attacks on cryptocurrency investors. And a warning - this conversation includes details of those attacks. Jeff John Roberts has written about all this for Fortune magazine. He is here now. Hey there.
JEFF JOHN ROBERTS: Hi, Mary Louise. Good to be here.
KELLY: Glad to have you with us. So this latest incident came to light when the victim managed to escape. That was last Friday. But I gather attacks like this are becoming common enough that there's a term for them. Why are they called wrench attacks?
ROBERTS: Yeah, and it's got a funny backstory to it. It's from a popular meme 'cause a lot of crypto people are very technically savvy...
KELLY: Sure.
ROBERTS: ...And are very proud of the digital locks they put around their crypto to guard it. But there's this meme that shows of how the crypto people think this will protect them, but they have a picture of a bad guy who's like, oh, he's got a password. Take this $5 wrench and hit him with it until he tells it to you. So the point being that even if you have really, really good digital security, if you're being beaten with a wrench, you're probably going to tell the password, and the security won't do you any good anymore.
KELLY: And how common is this? And who - how do we know? Who's tracking it?
ROBERTS: There's a guy named Jameson Lopp who, in my world, was called an OG bitcoin guy, and he's got a sort of running tally of them. And these aren't new. I mean, they've gone on for years. They've gone on since early bitcoin. But as the price of bitcoins, you know, goes up, the payoff for robbing someone is obviously higher. And the security has gotten better, too. It's harder to hack them. So we're seeing, I think, more - you know, more wrench attacks take place these days.
KELLY: Are we talking, like - what? - single digits, dozens a year? What are we talking?
ROBERTS: I think there was a couple dozen last year, and there's been a number this year already - you know, at least a dozen, maybe a few dozen, including one in France, where they grabbed this crypto executive and cut one of his fingers off and bound his girlfriend and put him in a car.
KELLY: Sorry - cut one of his fingers off?
ROBERTS: Yeah, they cut off one of his fingers, but he ended up safe in the end, but minus the finger. And there was another one in France recently where they found the wealthy crypto person in the trunk of a car covered in gasoline. I mean, it's very scary stuff.
KELLY: Well, what is being done about this? You write about how the crypto industry is taking notice and trying to combat it. What are they doing?
ROBERTS: Well, I think it's sort of a bit of cultural awareness. You know, don't go bragging about your wealth and - you know, where you are 'cause this can happen to you. Bodyguards are very popular with crypto people, too, and there's been a real sort of interest in - you know, a lot of top crypto people don't go anywhere without a bodyguard.
And then the final thing I wrote about is there's actually wrench attack insurance. Just as you'd insure your safety deposit box or something else, you can buy insurance for your bitcoin, which means if something like this happens to you, you can simply give them the password rather than having to make this very hard decision. One of the products is backed by Lloyd's of London, which, you know, of course, is, you know, a centuries-old insurance firm, but I haven't spoken to someone yet who's filed a successful claim. But I did speak to some of the people who are offering this product, and they say hundreds of people have purchased it, so - you know, but again, with these sort of things, when you're robbed, it's often done quite, you know, discreetly. And people don't want to publicize it, you know, so they're not attacked again. So it's very possible claims have been filed that we haven't heard about yet.
KELLY: Jeff John Roberts - he's finance and crypto editor for Fortune magazine. Thank you.
ROBERTS: Thank you, Mary Louise.
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