MyBitcoin Exit Scam
The popular web wallet MyBitcoin goes offline, later claiming a hack, resulting in the loss of ~78,000 BTC (~$1 million).
On July 29, 2011, the popular web wallet service MyBitcoin suddenly went offline, leaving thousands of users unable to access their funds. Days later, the anonymous operator known as 'Tom Williams' resurfaced with a claim that the site had been hacked and 51% of its holdings stolen. He announced that the service would close and users would only receive 49% of their deposits. The community widely regarded this as an 'exit scam'—an inside job where the operator simply absconded with the funds. Roughly **78,000 BTC** (worth roughly $1 million at the time, and billions today) vanished.
MyBitcoin was popular because it was easy; it didn't require users to manage their own private keys or sync the blockchain. Its collapse was a brutal lesson in custodial risk. It validated the mantra 'Not Your Keys, Not Your Coins.' Unlike Mt. Gox, which was an exchange, MyBitcoin was used purely for storage and merchant processing, meaning many users lost their life savings or business operating capital. It was the first major failure of a pure 'wallet' provider.
The MyBitcoin saga accelerated the development of non-custodial solutions. It drove users toward desktop clients like Electrum (which launched later in 2011) and encouraged the development of paper wallets. It remains one of the largest percentage-of-supply thefts in crypto history, and the perpetrator was never caught.
Key Sources: Bitcoin Wiki: Heist List | Ars Technica: MyBitcoin Collapse