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Seals With Clubs suffers security breach, shuts down Bitcoin-based online poker room

20 February 2015

By Aaron Todd
Seals With Clubs, the most popular Bitcoin-based online poker room, announced Friday morning that it is suspending operations and encouraged players to withdraw their existing balances as soon as possible.

"On approximately February 11th, 2015, several events occurred related to operational security that we consider to indicate Seals With Clubs now operates in a perpetual state of jeopardy," reads a statement posted on the site's home page. "All player funds and data remain intact and the issue was not software related. We do not believe any of our Bitcoin wallets used in operations to be compromised or lost. However, this event has made the majority vote of the ownership and team agree (sic) that shutting down operations is the best move for safety and security purposes."

The site's chairman, Bryan Micon, plans to launch a new version of the site, SWCPoker, in the near future. No explanation about the nature of the breach has been offered, but Micon may reveal details to the public in the future. Meanwhile, he has moved to Antigua with his wife and child to begin setting up the new operation.

"I believe there is a massive market in Bitcoin online poker," said Micon. "I'm honored to have been able to shape it up until now and I'm even more deeply honored to be able to shape it in the future and in a position of more control. I think it's going to reboot worldwide online poker."

Players with balances at Seals With Clubs are being encouraged to withdraw their balances as soon as possible. No balances will be transferred to SWCPoker. Players on Internet poker forums report receiving their Bitcoin from the site within a few hours of requesting a withdrawal.

"The lesson learned from Seals With Clubs is that this is how it's done right," said Micon. "This is how you should wind it down, this is how you should spin it up. And of course, you're solvent because you haven't raped the player fund pool as we've seen so many times from so many other sites"

Micon says SWCPoker will honor all player loyalty points earned at Seals With Clubs (known on the site as Krill), and the rakeback scheme for players will be the same as well.

"I've been reading a lot of the social (media) feeds, and sure there's some hate out there,” said Micon. “Haters are always going to hate on the Internet, but boy there's a lot of love. Honestly, it almost brings me to tears to see such an outpouring of love and support."

Traffic at Seals With Clubs grew exponentially as the value of Bitcoin skyrocketed to over $1,000 in the fall of 2013. The ease with which players could deposit and withdraw funds, once they became comfortable utilizing Bitcoin, made it incredibly popular with American players, whose online poker options shrank dramatically after Black Friday on April 15, 2011.

The full statement from Seals With Clubs can be read below.

Loyal players,

Effective immediately, SealsWithClubs will cease providing Bitcoin poker and will be shutting down all operations except to allow player funds to be withdrawn for a limited period of time. SealsWithClubs is, and has been, completely solvent up to this point in operations.

WE URGE ALL PLAYERS TO WITHDRAW THEIR FUNDS AS SOON AS POSSIBLE. PLAYERS SHOULD CEASE ALL ACTIVITY TO THEIR ACCOUNT DEPOSIT ADDRESSSES NOW.

On approximately February 11th, 2015, several events occurred related to operational security that we consider to indicate SealsWithClubs now operates in a perpetual state of jeopardy. We will not divulge details publically, but they may come to light if any team member chooses to come forward of their own volition at a later date. All player funds and data remain intact and the issue was not software related. We do not believe any of our Bitcoin wallets used in operations to be compromised or lost. However, this event has made the majority vote of the ownership and team agree that shutting down operations is the best move for safety and security purposes.

SealsWithClubs Chairman, Bryan Micon, would like to carry forward the business with his own team (currently settling in Antigua) but the majority ownership cannot guarantee the future security, solvency, and integrity of that operation because there will be no administrative oversight carried over from SealsWithClubs. Members of the SealsWithClubs team and ownership are not ones to lightly endorse anything, not even our own longstanding trustworthy team members, which is why nobody ever makes a sole decision. This dynamic has saved the business several times throughout the years. With Micon operating on his own with his own team, the checks and balances we have kept in place against one another internally for 3+ years will have been removed.

As the majority ownership & team will not go forward with operations but Micon is still in a position to do so, it makes the most sense to hand off assets to Micon in order to enable him to provide to our players the best Bitcoin poker experience he can. Micon has been extremely enthusiastic and dedicated to SealsWithClubs for longer than any member of SealsWithClubs historically, and we truly believe he wants what's best for its players.

We've made considerable effort and expense on a SwC 2.0 software package over an extended period of time; we are transferring the rights to that package in full to Micon with the understanding he will remain faithful to the revenue share and licensing agreement SealsWithClubs had with its primary developer(s) that continue work on it. We suspect that the primary developer(s) behind that project will gladly continue working with Micon. Micon will also be provided the swcpoker.eu domain from which we were planning to continue operations from once SwC 2.0 was ready to deploy. As such, we believe Micon will have the resources at his disposal to bring the new site up, backed by the new SwC 2.0 software package, at a rapid pace.

The traditional SwC 1.0 clients and server, based upon the PokerMavens server/client software and protocol, will be retired. There are a number of operational and security considerations to the SwC 1.0 architecture that we do not feel could be properly documented and conveyed to any new team for further operations or development. At this time, those available must focus our efforts elsewhere.

While the majority ownership and team wish the best for Micon and his operation, we prioritize remaining faithful to our player's balances and security first and foremost. The SealsWithClubs.eu domain, related social media accounts and support e-mail addresses (for the duration they are still active and being checked) will solely be used for administrating and paying out all remaining player withdrawal requests. In the event the domain is seized or the current withdrawal server is made inoperational during the period withdrawals are still being administrated, a signed GPG message from hdev or xdev will provide definitive instructions for players to continue making withdrawal requests assuming we are still available and able to draft such a message. Any unsigned or invalidly signed instructions by others should not be considered legitimate.

Please note that withdrawals will only be open for a limited period of time and be solely administrated by those uninvolved with Micon's new operation who have been charged historically with maintaining SealsWithClubs solvency. Those able to stick around to process these withdrawals are hoping to commit to at least a few months of availability. We hope that this is sufficient in allowing all players to make their appropriate claims to their funds before they are made unavailable; in addition, we hope our players will do their part by spreading the word.

In line with remaining faithful to player security, we will not be providing Micon or his team with account passwords or authentication information or balance details. We will provide to him account names and the current e-mail addresses associated with them, as well as the krill amount associated to each account. This should allow his team, if they choose, to reserve usernames and e-mail password resets to users as well as honor their Krill amounts. Micon will also be provided the current e-mail address and account names of any affiliate accounts and the accounts associated under them so that he can choose to remain true to the affiliates in the affiliate program that he pioneered through the years for SealsWithClubs.

IF YOU DO NOT HAVE AN EMAIL ASSOCIATED WITH YOUR ACCOUNT YOU WILL NOT BE ABLE TO CLAIM YOUR KRILL AT SWCPOKER.EU IN THE FUTURE. YOU HAVE THE OPTION TO ADD OR CHANGE IT NOW USING THE FORM BELOW.

I reiterate for emphasis: Micon nor his team have not and will not be provided access to SealsWithClubs player funds or account credentials at any time. This limitation is not placed in order to hinder Micon or his operation, but rather, to remain true to the SealsWithClubs administration's commitment to player security and balance integrity to the very end.

Thank you to all of our players for your support, trust, loyalty and enthusiasm throughout the years. We know that cryptocurrency poker is here to stay and it saddens us all to be in a position that we can no longer reliably be the ones to provide it to you.

Seals Administration
Seals With Clubs suffers security breach, shuts down Bitcoin-based online poker room is republished from Online.CasinoCity.com.
 

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Aaron Todd

Home-game hotshot Aaron Todd has covered the gambling industry since 2006. While he is happy to play Texas Hold'em, he'd rather mix it up and play Omaha Hi/Lo, Razz, Deuce-to-Seven Triple Draw, and (his personal favorite) Badeuci.

Since graduating from St. Lawrence University, Aaron has worked as a journalist covering the gambling industry and as a communications specialist in college athletic departments.

A native of a small town in New York just south of Ottawa, Aaron lives in Needham, Mass., with his wife and three children. Write to Aaron at aarontodd@casinocity.com, and follow him on Twitter @CasinoCity_AT.