A sale of the Bitcoin cryptocurrency ending in a credit card chargeback resulted in Wozniak losing seven Bitcoins with nothing to show for it.
Speaking at the Economic Times of India’s Global Business Summit on Saturday, Steve Wozniak told attendees how he was scammed out of thousands of dollars worth of Bitcoin. According to Wozniak, the perpetrator agreed to purchase seven Bitcoins via credit card, then cancelled the payment after the transaction went through.
The credit card itself was apparently stolen, so there was no legal recourse available, according to the Economic Times.
Wozniak bought the bitcoin several years ago when it was worth around $700 per coin. The amount he was conned out of has a value of $74,800 at recent market value.
Speaking to the audience, Wozniak noted that he was never interested in the cryptocurrency for its potential to appreciate in value. He just wanted to travel without carrying credit cards or cash, having researched which hotels and other destinations would accept Bitcoin beforehand.
Wozniak hasn’t let the experience sour him on Bitcoin, having originally being drawn to the fact that the cryptocurrency can’t be manipulated by any government.
“Bitcoins to me was a currency that was not manipulated by the governments,” Wozniak said. “It is mathematical, it is pure, it can’t be altered.”
There is no intermediary bank in crypto-transactions. Transactions that involve buying or selling crypto in exchange for another currency or for goods and services occur directly between users and are recorded in a “blockchain,” a public ledger that exists as a distributed database.
Essentially, a fraction of a coin is sent to the anonymous address of a user. Transactions are effectively an encrypted message that delivers the identifying number of the coin encrypted using the public key of the buyer and a secret random private key of the transaction. This transaction is recorded in the blockchain, allowing the buyer to later sell their received crypto by using the correct private key and using it to transfer the crypto to a new buyer using that buyer’s public key.
None of this stops a credit card transaction from being reversed by the sender, however.