Mt Gox Bitcoin Exchange reports continued 7-10 day delays ...
Mt Gox Bitcoin Exchange reports continued 7-10 day delays ...
Mt. Gox Victims Must Take Claims to ... - Bitcoin Mine News
Mt. Gox Users, Mizuho Bank Seek Delay in Lawsuit to Await ...
Mt. Gox Users, Mizuho Bank Seek Delay in Lawsuit to Await ...
Re: inquiries about MtGox disbursements and proposed revival
Here’s why we’re in this situation. The trustee forced the user-victims to give, without compensation, a free call option to the Gox shareholders to buy 200k BTC at $2500 at any time prior to the distribution. Thus, a perverse incentive to delay distributions was born. The result:
CoinLab/Vessenes demand a massive settlement. The argument goes: the lawsuit may be frivolous but if you don’t settle, you’re going to lose out even more on the rising price of bitcoin. Straight up legalized extortion, but nothing new – same tactics used by patent trolls.
The shareholders are the other obvious adversary here. For all we know, the shareholders are financing or otherwise incentivizing CoinLab to continue pressing the lawsuit and delaying distributions. Shareholders may be running their own delay tactics that we’re unaware of. Until we see 100% of the shareholders make binding commitments to allocate 100% of their ill-gotten gains to the user-victims, we can’t discount their involvement.
Essentially ANYBODY in the nexus of parties responsible for making distributions could become compromised by massive incentives to delay offered by Gox shareholders.
What can be done?(in theory)
Reject the commingling of user-victim assets and company assets from the outset. If a bank goes in to bankruptcy (in the US), the contents of the safe deposit boxes cannot be auctioned to pay off the bank’s credit card. The asset that the bank holds is the contract to service the safe deposit box, and that could be auctioned to another servicer, but not the contents of the box itself. It can be argued that missing box contents are the responsibility of the bank, but not that missing bank assets are the responsibility of the box renters. How did we get in to this situation with Gox?
Demand that the call option for Gox shareholders be canceled and instead be offered to user-victims.
Demand that a reassessment of the price of bitcoin be done at the time of distribution.
Demand no conversion of any assets and distribute pro rata all assets (USD, EUR, JPY, BTC, etc) as they are, according to the exchange rates established at the start of the bankruptcy proceedings.
Sue the MtGox/sharehoders for unjust enrichment/conversion and get a preemptive lien/garnishment against the distribution that might go to them.
With regard to the proposal to revive MtGox, I just don’t see the ROI for an investor to take this on. It’s a massive and extremely difficult undertaking with a highly improbable outcome. Why shouldn’t the investor just hodl and chill, or buy a fully functioning, profitable exchange without a massive brand problem? Why shouldn’t Kraken just dump $245m in to marketing instead? And, why would it be necessary if the shareholders would just commit to donating their gains to the victims? The trustee has already said that fiat payouts will be optionally payable to Kraken accounts, and that if bitcoin payouts are approved by the court, they will be payable only to Kraken accounts. If any of the Gox shareholders end up with an unexpected windfall that they wish to distribute to the user-victims, Kraken would happily facilitate. Kraken already has most of the accounts as a result of our facilitation of claims collection, the $1m worth of free trading each claimant received, and our providing support to victims and trustee over the last 4 years. People are not sitting on the sidelines waiting for a MtGox revival – they’ve been off trading elsewhere and you’d have a hard sell bringing them back. IMO, it's a pipe dream. I'm glad to see the formation of mtgoxlegal.com and hope that together the creditors can drive some progress toward the only morally acceptable outcome, which is that the user-victims receive 100% of whatever remains after bankruptcy fees.
I am a Bitcoin noob that want to transfer money from Japan to the US.
My girl friend is a foreign exchange student and her family wants to send her some money around 400 usd. I have been following bitcoin for awhile now and was just curious if i could get some advice. I'm worried that: 1. The exchange fee from Yen to BTC and then from BTC back to USD will be too much for a 400 dollar transaction. 2. I think it is but i'm not sure its legal to move money this way. 3. I'm worried the process of buying and sending bitcoins will be to complicated for her parents to understand. (Her mom has been struggling to learn snapchat for the last 3 days) Any advice or discussion is welcome and appreciated thanks!
TL/DR: A young man had a secret. To keep it hidden, he kept digging until the hole was a billion dollars deep. This is a speculative tale of a great bitcoin theft from MtGox in 2011 and the efforts that this man undertook to fix it. The tale explains the bitcoin bear market of 2011, the explosive rally of 2013, delayed fiat withdrawals, malled transactions, and a bot named Willy. “By the time you realize that real life has begun, you are already three moves in.”—Author unknown It was June 19, 2011. Mark, a 26 year-old young man—a boy really—was ecstatic. He had recently purchased MtGox—a small, online exchange for trading virtual tokens—and business was booming. These virtual tokens were called bitcoins and Mark loved them. Bitcoins were an obscure curiosity: a peer-to-peer electronic cash system that allowed users to store and exchange credits with any other user in the world, nearly instantly, and without the assistance of a third-party or the permission of an authority. All that was needed was a 78-digit secret number—a key if you will. In order for his customers to withdraw their bitcoins over the internet, MtGox stored some of these keys on its online server. The remaining keys were stored on USB drives and backed up on paper to prevent theft should the server be compromised. But theft was hardly a concern. In October of 2010, bitcoins were trading for $0.10 and the half a million bitcoins held by MtGox was worth only $50,000. But still Mark took precautions, diligently moving bitcoins to offline storage and leaving only what was necessary for customer withdrawals online. He truly wanted both his business and bitcoin to succeed. By April, the bitcoin price had risen to $1 and by June it had exploded to $30. Between June 1 and June 15, an additional one million bitcoins were sent to MtGox and immediately sold, crashing the price back to $10. It was a hectic time, with hundreds of customers needing help, visits from the FBI related to the Silk Road black market, and stress related to the recent market crash. Young Mark was becoming a victim of his own success: there simply wasn’t enough time to get everything done. On this very day in June 2011, the keys to the recently-deposited 1,000,000 BTC were still sitting on his server. Later this day, a group of hackers gained access to MtGox servers and executed fake trades that the world could see, driving the nominal price of bitcoin near $0. Mark was frantic. He quickly regained control of the servers and learned the dark truth: the million bitcoins that had recently flooded in earlier that month were gone. Mark admitted publically to the hack, rewound the false trades, but kept the truth of the missing coins a secret. How could this 26-year old explain to his customers that he had lost their bitcoins? And if the world found out, would this kill the thing he loved so dearly? Would he go to jail? Or worse yet, would someone kill him? Mark decided that he would do what he thought was right: he would slowly earn back the lost bitcoin with MtGox trading fee profits and eventually make his customers whole again. He still had over 500,000 BTC left—he moved 424242.42424242 BTC between bitcoin addresses and convinced the community that MtGox was solvent. As long as withdrawals didn’t exceed deposits over a long period of time, no one would ever find out the truth. Or so he thought. Meanwhile, the bitcoin thieves slowly mixed their coins with other coins, obfuscating the chain of ownership, and then re-selling these coins on MtGox using sock-puppet accounts. Mark tried to stop them, but there was no way he could know for sure which accounts were fraudulent—he even accused innocent people of bitcoin laundering. The constant selling of these stolen bitcoins drove the price down to $2 in November 2011. Mark faithfully used all of the MtGox profits to purchase coins back during this decline. But he would never use customer funds—that was a line he swore not to cross. The selling of these stolen bitcoins continued at a diminished rate over 2012, and Mark continually purchased coins using the MtGox trading fees. The bitcoin economy was growing and new exchanges were opening up across the world. His bitcoin reserves weren’t building fast enough but the price of bitcoin kept rising (along with the dollar value of the missing bitcoins). He was worried that other exchanges would suck coins out of Gox and reveal his secret. He decided he needed to take decisive action: for the first time, he used customer funds to purchase real bitcoins. These large purchases by Mark further increased demand and ignited the great rally of spring 2013 when the bitcoin price shot from $20 to $266. Mark had reduced his liability in bitcoins, but in dollar terms the coins that were still missing were worth more than ever before. On May 15, 2013 the US Department of Homeland Security seized millions of dollars from the MtGox Dwolla bank account. MtGox dollar reserves were already depleted at this point, and with the recent seizure, Mark could no longer make good on customer withdrawals in US dollars. Under the guise of “banking problems,” MtGox slowed US dollar withdrawals to a trickle in the summer of 2013. Customers became increasingly worried and began to bid up the price of bitcoin on MtGox, as this was the only way to escape with their funds. MtGox had little fiat and very little bitcoins, but it learned one thing: as the price differential between Gox and BitStamp grew, the outwards flow of bitcoin slowed dramatically. And so Willy was born. Willy was a bot, discovered by Wall Observers from bitcointalk.org and named by Opet on Bonavest's trading show, who would consistently purchased bitcoins at regular intervals between November 2013 and February 2014. Evidence that Willy belonged to Mark was revealed when both web and API trading at Gox was disabled for a brief period of time, exposing Willy as the only one left buying. Willy served two purposes: he drove the price of bitcoin on the MtGox exchange high, thereby slowing and sometimes reversing the outward flow of real BTC, and he reduced the number of GoxBTC held by clients. Of course, this meant that Willy eventually became the owner of a huge number of GoxBTC (that were of course no longer backed by real BTC). By December, the situation at MtGox was grim. In a desperate attempt to attract more funds, Mark offered reduced trading fees under the guise of celebrating their 1,000,000th customer. This partially worked, but Mark knew it was too late. If MtGox collapsed, it must appear that he didn’t know about the theft until now—for it was better to appear incompetent than criminal. It was time to cover his tracks. He purposely mixed immature coins into bitcoin withdrawals to delay the outward flow of coins, and later began malling his own transactions. He added the Gox malleability weakness not as a bug, but as a feature, so that it would seem plausible that outsiders had recently stolen the coins without his awareness. No coins were actually lost to malleability. The MtGox coin supply dwindled to 2,000 BTC and on February 7, 2014. He had no choice but to disable bitcoin withdrawals. The end was near. The problem Mark faced was that his customers had $150,000,000 credited to their accounts, yet the MtGox bank account only contained $38,000,000. He could blame the missing bitcoins on transaction malleability, but how could he explain where the fiat money went? He shifted Willy into reverse and cranked the throttle. Willy relentlessly dumped bitcoins into the open bids. The price fell further and further, eventually dropping well below the BitStamp price. But still not enough people were buying! He needed his customers to buy the GoxBTC. Willy kept dumping coins until finally the price dropped below $100. MtGox even acquired new USD bank wires from customers looking to purchase the cheap coins. By this time, the majority of Gox customers had converted their dollars into bitcoins. On February 28, 2014, Mt Gox filed for bankruptcy protection in Tokyo, reporting 6.5 billion yen in liabilities, 3.8 billion yen in assets, and 750,000 of customer bitcoins missing. Willy had failed to completely close the fiat solvency gap and Mark finally admitted to having lost the coins. Now we watch the rest of the story unfold. A story of how an oversight during a hectic period, an untimely theft, and an attempt to cover it up, lead to the greatest loss in the history of bitcoin. Cross-posted from: https://bitcointalk.org/index.php?topic=497289.0
Even with current straight bankruptcy (hasan) trustee can address the court based on finance analysis and cuncil for new evaluations of intangible assets(btc) due to price violity and significant asset value increase after inital btc value evaluation, what if approved, with current straight bankrupty btc+forks must be sold to pay all creditors with updated and new evaluated claims. On another hand, only if CR and plan is approved, these btc and forks can be distributed unexchanged (unliquidated) to the creditors. All asset whatever tangible or not is liquidated only to the certain point to get liquid asset (funds) to pay all creditors. When that is done, bankruptcy is completed and court/trustee authority stops. Any remaining asset remain as asset what company can use to resume busines or whatever they choose. Ordinary, in bankruptcy liquidation, all asset in full had to be liquidated, because creditors claims are much higher then company assets worth. Its liqidated in full only if asset can't be sold partialy and there is no other assets to be liquidated. However, in MtGox bankruptcy things has changed, untangible asset are now worth much more then total of approved creditors claims and if claims stays with current evaluation, asset will be liquidated only to the funds worth what equal all total approved creditor claims, nothing more! Update: under bankruptcy (hasan) corporation has to be dissolved what after distribution of all creditors has been made and Court bankruptcy termination order , dissolution esentualy cause all remaining asset liquidation and surplus sent to the shareholders - Tibanne and then Mark Karpeles. Worst case scenario: The Court settle all creditors claim with current evaluated btc (483$) +fiat+interst coverted and paid as JPY where only enough intangible assets (btc) are liquidated (sold) to settle all creditors (what are almost already done), what makes bunkruptcy completed and reamining 165k btc and forks remain as Mtgox intangible asset where they can do whatever they want, liquidate and pay dividends, trade with btc, invest in other projects etc (bankruptcy is over, no obligation or liabilities to MtGox creditors). (Unfortunetly, in my opinion, this will most likely be the case. Read edit at the end of the OP). Update: under bankruptcy (hasan) corporation has to be dissolved what after distribution of all creditors has been made and Court bankruptcy termination order , dissolution esentualy cause all remaining asset liquidation and surplus sent to the shareholders - Tibanne and then Mark Karpeles. Better scenario: If some miracle (never) happens the Court accept new btc evaluation, but then these to be paid as JPY, all (or better to say) suficient remaining btc need to be sold(liquidate) to settle new evaluated creditor claims and question is how much liquid asset (funds) creditors would receive due crushing the btc price. Eventual btc+forks surplus(°) what would be quite lower then in worst case scenario, would remain as intangible MtGox asset where corporation can do whatever they want - bankruptcy is completed. (°(eventual btc+forks surplus would depend on new btc price evaluation for creditor claims and difference in new total claimed sum vs. funds JPY what trustee get from actual btc liquidation). Update: corporate dissolution aplies here too, just much less funds to be sent to the shareholders. Best scenario: (Low probability, read edit at end of the OP) Civil rehabilitation under supervision with approved plan where creditors can claim all remaining btc+ forks unexchanged (not liquidated) + what is already been liquidated. In this case, if plan is approved we would get 100% our current claim. We need to divide total claimed JPY sum with 50.058JPY (btc 483$) to get how much that is as btc base and on that result add aprox 17% of btc/bcc distributed as btc/bcc. Percentage (17%) might be lower, depend on ther lawsuit and non mtgox users creditor claims. Example of the best case scenario: Current approved claim. Rates to JPY (2014) BTC= 50,058.12 JPY; US$ = 1USD=103.64 JPY Currency US$ balance = 1,200$= approved sum JPY=124,368. Bitcoin balance = 14btc = approved JPY = 700,813.68 124,368+700,813.68 =825,181.68 JPY total of approved creditor claim/ that is sum what creditor receive 100% sum (liquid funds almost available, to be distributed as JPY). 825,181.68/50,058.12=> 16.48 BTC base: 16.48x17%=> 2.80 BTC and 2.80 BCC to return as cryptocurrency. Sumarise: Creditor receive 825,181.68 JPY and 2.80 btc and 2.80 bcc. That would be max return. Same calculation is aplied if creditor had only btc balances, only any currency (fiat) or both currency(fiat) and btc. Both fiat or currency mean: USD, EUR, GBP, JPY etc. Iam not sure what that actual CR and plan are in the "best case scenario" as I have no details. We actually need sort of "better case scenario" just without required to liquidate remaining btc+forks and to be distributed as intangible asset (btc+forks). Beside, its Trustee duty to look best interest of all creditors, but for bankrupt company as well, what might cause conflict. Its defenetelly hard and complex situation, for all parties. Questionable is whatever liquidated intangible asset (btc) under bankruptcy (straight or CR) are subjected to the capital gain (not dividend) and approprate income tax what would cause lower(dilution) funds distribution. However, in that case question is how would be regarded our creditor claims i.e. deductable as intangible asset value entry? Capital gain/profit- loss - deductable - expense=> corporate gross income - tax=> net income. So actually, from what I know from accounting practise, paid funds for evaluated claims would be asset (btc) "in value" while liquidated asset "out value" so actual capital gain net from btc are: difference in paid claims minus actal liquidation value! Beside, that "net capital gain" are not actually "net gain" as there are minus from other deductable sums and only when they are substracted make net income before corporate income tax! It maight be discharged, but I doubt it. Only liquidated untangible asset (btc) are regarded as corporation capital gain/profit, its not corporation dividends. Its conflicted situation because MtGox did not bought these btc, nor mined them, nor gifted, nor received as Mtgox investment and they were never corporation assets. Control of btc as intangible assets does not always equal propietorship (if there are contract or mutual agreement), but it will be (are) if not chalanged and Iam not sure on what grounds are we creditors then (unless corporation addmited debt/liability, but then again on what terms and conditions or user agreement these btc have been received?). Regardless, Trustee must have profesional finance advisoaccountant. Some examples of intangible assets: patents, trademarks, franchises, goodwill, copyrights, Internet domain names, performance events, licensing agreements, service contracts, computer software, blueprints, manuscripts, joint ventures, medical records, permits, and trade secrets and many more. When MtGox were alive, such intangible asset doesn't enter finance balance sheet neither as asset value or liability value. It would if MtGox exchanged them (trade) for his account with buy/sell price. MtGox when alive these btc just had to record in secundary books as btc +/- held analiticaly for each user. Under bankruptcy proceedings, such a intangible assets as bitcoin is very hard to assest (evaluate), usualy trustee waits until last minute bankrupt company to liquidate them or best bid (°) and to update btc evaluation value what prior were blank, in order creditors get as much as possible. In our case, trustee did not do that and I have not found anything what would make him to evaluate at start of the filling the claims. (°)Actually I think, in case of public auction certain restriction might apply, certain party can't bid (I might be wrong). However, not all asset are in the same category. In my country, bitcoin is regarded as financial asset, it does not matter is it tangible or not. If I as a person or the company make money from trading internet domains, it would be regarded as income subject to the tax. But if I as a person (not company) make money from exchanging certain personal financial assets, btc, any currency, diamonds, gemstone, gold and earn (dividends and interest excluded) from the positive rate difference, it would not be income subjected to income tax. But in same situation, company would be subjected to the taxes. Capital gain has two separate catogory, dividends what is profit on top of asset (asset reamin) and capital gain from the trade of asset, where one asset is exchanged to another asset and profit is from the rate difference, which can be either positive either negative. There was a lawsuit against bankrupt Mtgox where user requested full btc refund what were denied with this explanation:
Presiding Judge Masumi Kurachi said the Civil Code envisages proprietorship for tangible entities that occupy space and allow for exclusive control over them. The judge said it is evident bitcoins do not possess the properties of tangible entities...
I'm curious to learn the real story behind the alleged Apple bitcoin ban. Jon Matonis from Forbes wrote an article a year ago, which I think is a bit speculative. But more importantly it's not actionable. Just waiting for Apple to change their mind once Bitcoin becomes mainstream is boring. :-) The Blockchain app update message from March 13 2012 (version 1.9) says "Removed wallet functionality". But now it seems the wallets are still there. Did they sneakily or accidentally reintroduce them? They also have a Cydia version for jail broken devices. From the source code it seems that it enables the "deposit" button and also tells the server that it's running Cydia so it can present different functionality. Another wallet app was BitPak. It disappeared from the store and the author has moved on to other things. In both cases they were rejected because Apple wasn't sure if it complied with all regulations in all countries. According to the author of BitPak, Apple refused to specify which regulations in which countries might be violated. It must be great when you have the power to decide who has the burden of proof :-( MtGox has an Android client and refers users to Cydia to run their iPhone client on a jail broken device (which is a bad idea if you care about security). I don't know if they've attempted to go through the Apple review process, if they got rejected and if and how hard they tried to appeal. The Coinbase iPhone app does not support payments. Again it's unclear if they tried and got rejected for the same reason. Are there any other (would be) iOs apps that allow payments? I'm not talking about web apps. It would great to get some clarity on this issue, in particular: * know if all 4 apps were rejected for the same reason and have at least tried to appeal the decision (and the relevant dates) * ask Apple if they are willing to specify which countries and which regulations they are worried about. At the very least get them to name 1 country and 1 regulation and a promise that they'll keep feeding us other regulations that they are worried about if we deal with that specific one. * compile our own list of potential legal issues, ideally supported by referring to any known (threat of) legal action that has taken place on Android Coinbase, MtGox and Blockchain all have more functionality in their apps than just payment. If they push this issue further, it will at the very least delay their ability to ship regular updates for those features. This is because you can not ship another update to your app if you are in the middle of an appeal process. A good way to tackle this issue is to try and submit a new Bitcoin wallet app with the all-or-nothing goal of getting the app approved with payment functionality included. I'm interested in doing that, but for the moment I don't have time to build it from scratch. I'm based in The Netherlands, so after an initial rejection the first thing I might try is to release it in the Dutch App Store only, since I understand that legal system a lot better than the US and Apple knows that the Dutch government is unlikely to fine Apple without warning.
You don't just Test your system if you don't intend to come back online!
Remember Mark said that there was still hope for MT.Gox, and of course no one believed them. Now they wouldn't just come back online all "business as usual"... They HAVE to have some card, ANY card to play... And the last two months MT Gox seems to had been in a race against the clock.... But no one seems to ask what they were running toward. Remember, "Midas Trading Engine"? It was supposed to be finished JAN 1st. If the Midas Trading Engine is really the platform they've been bragging it is going to be, that gives them a hand to play. They can:
Say/show proof that the Trading Engine is advanced and secure.
Help spur investor capital.
And help keep the bleed of market share. TwoBit knows, and so does the foundation. They knew about Gox's problems and kept quite.... And now they know "something else" that they are not sharing.
1) The Foundation never once warned Bitcoin investors about keeping deposits in Mt. Gox, despite clear red flags dating back to at least April 2013. Nor did the Foundation craft or advocate for best practices such as technical transparency, deposit audits, or appropriate consumer protection disclosures. This was a colossal failure of leadership. 2) There is evidence that Bitcoin Foundation board members may have had direct access to Mark Karpeles which allowed them to personally deposit and withdraw funds from Mt. Gox, despite persistent delays for other customers. 5) Peter Vessenes has had a nine month conflict of interest regarding Mt. Gox given that his company CoinLab was involved in an active multi-million dollar lawsuit against Mark Karpeles and Mt. Gox, following a failed partnership. Both men remained on the board of directors, and the Foundation failed to draft adequate by-laws that would allow them to address situations such as this where directors had material conflicts, which would compromise their ability to act in the best interests of its members. At this week's Texas Bitcoin Conference, I was fortified by near-unanimous agreement (and, at times, applause) that the current leadership must resign or be forced out of their positions on the Foundation. ** Yet I have also been warned that I am playing a dangerous game, with cunning and ruthless power brokers. I have been discouraged by corporate sponsors of the Foundation not to make a public stink which would be "counter-productive" and "irresponsible" for Bitcoin.** Most would prefer to let the Mt. Gox scandal blow over, but I would rather wipe the slate clean definitively, blood or no.
Bitcoin exchanges were concieved and designed as scams, and eventually they will all go the way of Magic The Gathering Online Exchange, more popularly remembered as MtGox
I unearthed an old post I had written a long time ago in a forum far, far away. My prediction came to fruition with MtGox, and the danger remains for anyone who has money floating around on these exchanges. If the owners decide the commissions are no longer worth more than raking in the entire pot, they retain the legal right to abscond with your bitcoins. You want the truth about bitcoin? https://www.mtgox.com/terms_of_service
Members will be held liable for losses incurred by Mt. Gox or any other user of the Site due to someone else using their password or user account. Mt Gox cannot be held liable for any malfunction, breakdown, delay or interruption to the internet connection, or if for any reason our site is unavailable at any time or for any period. OR IF FOR ANY REASON OUR SITE IS UNAVAILABLE AT ANY TIME FOR ANY PERIOD
BTC-e may terminate, change, suspend or discontinue any aspect of this website, including the availability of features of the site, at any time. BTC-e may also impose limits on certain features and services or restrict your access to part or the entire website without prior notice or liability.
Cannot be held liable for any malfunction, breakdown, delay or interruption to the internet connection, or if for any other reason our site, is unavailable for any period of time.
But we already used that one, lets be more creative.
BITFINEX reserves the right to suspend or terminate any Services Agreement for any reason, including the ending of services that have already commenced. This included the suspension or termination of any registered member's account.
CampBX, in its sole discretion, at any time, without specifying a reason, and without liability of any kind, reserves the right to: halt trading limit deposits and withdrawals
Here's a new one:
CampBX accepts no responsibility for the accurate maintenance of the trading platform
Don't forget to watch out for each site's "client obligations!" Have I missed any? There may be new exchanges or failures I haven't heard about since I stopped caring, feel free to add to the list. I'm not here to discuss the pros or cons of imaginary internet money, only the blatant cons of the most popularly used exchanges which determine the market value of the "commodity".
PSA: Bitinstant is reliable and I believe they have the best intentions in mind, however beware of their cash to btc wallet service.
Last Friday I committed to spending some cash on bitcoins. I ended up sending $1500 through ZipZap to bitinstant for a btc wallet deposit. I had to do this through 3 separate ZipZap deposits, and was told I would receive $480.05 for each deposit. I expected I'd end up with about 15 BTC, although I was quoted around 17 BTC, because I was aware there would be some time delay involved between me getting the to the store and Bitinstant getting my cash. There was a gap of about 4 hours between the confirmation of payment and Bitinstant sending me coins. These hours were fairly agonizing since I had no idea how they were going to choose the price I paid for bitcoins, but it made sense to me that I would pay what bitcoins cost when they received my money. I assumed that this would be most fair, since it was the only measure of price that I could have some control over. My orders according to bitinstant were completed just after 00:00 on Saturday 13th, and the blockchain received the first batch about two hours later (if someone can explain the delay I would appreciate it). Here's a list of my orders and the MtGox prices at the times each order was updated: Order: 33593b0b-5488-4f1c-8d24-92b4090b13d4 Quote: apr 12 19:27 $80.61 Confirmation of payment: apr 12 20:11 $93.86 MtGox order loaded: apr 13 00:23 $128.54 Executed: apr 13 00:38 $123.02 Order: c8197c55-2367-44f7-81d6-a85a1bba9014 Quote: apr 12 19:11 $85.46 Confirmation of payment: apr 12 20:01 $89.19 Executed: apr 13 00:09 $118.19 Order: d32aea0d-1ffe-4647-b1f4-b1f57f69f802 Quote: apr 12 19:14 $84.78 Confirmation of payment: apr 12 20:19 $94.77 Executed: apr 13 00:08 $118.26 Wallet for blockchain confirmation: 1Cns9jvnj58mwnsMNQZLk3Rcsa4snkvQ5U Bitinstant grouped the three transactions and sent me three separate payments of exactly 3.73098775 each. By the time the last coins first showed up on in the blockchain (0 confirmations), I had received $1167.43 worth of bitcoins. I first went to bitinstant support, but it's been nearly a week and I haven't heard anything except the automated response that confirmed they received my message. I also tried PMing bitinstant because after reading several threads I saw that bitinstant is proactive and seems like a good guy, but I had no luck there either. I recognize now after much reading that there are issues with MtGox and that Bitinstant is dealing with a massive increase in usage (would that I had read it sooner), so I don't feel like Bitinstant intentionally shorted me by so much, but I do want everyone else to be aware that when the Bitinstant changes your currency, you are making a gamble you don't have much control over.
[Informational] [CC0] The Dijon Malaise: The Rise and Fall of Karpelès
Mark Karpelès, also known as MagicalTux, is a former operator of the notable Bitcoin exchange MTGox, as well as a founding member of the Bitcoin Foundation, and a major contributor to the Bitcoin Wiki project. Karpelès notably presided over the great failure of the MTGox exchange, with his tight control of information and seemingly criminally irresponsible behavior yielding unprecedented outrage in the Bitcoin community.
Mark was born June 1st, 1985 in France, and grew up in the city of Dijon. In his teenage years, it is rumored that his interest in computers turned criminal, according to various sources. Although apparently convicted, Mark served no time and was burdened with no public criminal record. It's documented that Mark moved from Dijon to Paris, attending the schools Lycée Claude Bernard, and Lycée Louis Armand in Paris, finishing his education in 2003 at age 18. He soon found employment at the Linux Cyberjouers company, working as a network administrator and software developer for two years. After his stint at Linux Cyberjouers, Mark reportedly went to work for the French company Eurocenter, a game software development studio for two years. Reportedly Mark's work at Eurocenter led to a dispute and accusations of financial fraud. Mark was eventually convicted of the accusations in 2010, resulting in a one year prison sentence. However Mark never returned to France to serve his one year sentence, because in 2009 at age 24 he had moved to Tokyo Japan, never to return to France. In Tokyo, Mark formed a limited liability company Tibanne, named after his cat, and found a new life there, marrying a local woman, fathering a child, and developing a conversant ability in Japanese. In 2010, Mark began to take part in the early Bitcoin community, volunteering time and effort to restore and rehabilitate the neglected Bitcoin Wiki project by reforming it and switching to a MediaWiki installation. Mark worked to create an extension to the wiki to charge for edits, and he ran a fund drive to generate funds to promote development of wiki content, although the five hundred donated bitcoins were never spent or returned. In 2011, at age 26 Mark purchased the nascent Bitcoin exchange MTGox from the developer Jed McCaleb, acquiring an 88% stake in the company. It is rumored that at that point, he may have also taken on some hidden debt, stemming from a possible hack on the exchange during Jed's tenure, and reportedly during the switchover there may have been more funds lost. Nevertheless, the MTGox exchange led the way as an early pioneer of what was to follow in Bitcoin exchanges, and quickly rose in prominence as Bitcoin's fame and fortune began to pick up in 2012. At 2012, at the age of 27, Mark joined Gavin Andresen and others in forming the Bitcoin Foundation, a trade association that was intended to funnel money towards the interests of Bitcoin, as decided by its board and members. Towards the end of 2013, Karpelès worked to keep up with the rapacious demand of a Bitcoin bubble, fueled by massive media coverage. As the months wore on, the increased scrutiny and volume started to cause obvious issues. US regulators froze his accounts. He started to report issues with his own Japanese bank partners. The MTGox exchange started to delay and block withdrawals of fiat, and eventually Bitcoin, sparking concern. After drafting several crisis plans and circulating them to possible investors to help bail out MTGox, Karpelès eventually revealed that the exchange was inoperably bankrupt, had lost users' funds on deposit, and he pointed blame at a Bitcoin Blockchain bug called transaction malleability as being the culprit, demanding that the Bitcoin Core developers immediately fix the issue. The Bitcoin Core developers rebuffed these demands and accusations, pointing to documentation on Mark's own wiki that detailed the bug and showing that it could be worked around, and that it was a well known issue that should have been dealt with by a competent programmer. In February of 2014, Mark stepped down from the Bitcoin Foundation, and the MTGox exchange became defunct, the entire matter turning to the courts for resolution. In August of 2015, at age 30, Karpelès was arrested for falsification of financial documents, embezzlement and misuse of company funds, including recorded instances of solicitation of prostitutes with company money.
I am now showing my experience that can possibly prove Mtgox used completely isolated cold wallet
I know the reason why many people, like me, trusted mtgox is that We thought Mtgox had earned enough coins due to early involvement and they hold 90% of coins in cold wallet as Mark Karples had reiterated many times. And we all know, Mtgox lost most of customer's coins because of allegedly leaked cold wallet. That being said, their "cold wallet" is not real "cold wallet". Many people suggested a viewpoint, Once hot wallet gets depleted, coins will be transferred from cold wallet automatically. But, From my own experience, this viewpoint is not the truth. I used mtgox from August to November. I frequently deposit and withdraw hundreds of coins.
If I withdraw in the afternoon (Japanese time zone), then it will be processed immediately with near 100% chance. If I withdraw after middle night, then it has about 10% of chance to be delayed. For example, At 3 a.m. If I withdraw 200 btc and it does not show in my own bitcoin address at once, then Next withdraw will be delayed too if the withdraw amount is same or larger. And all these delayed withdraw are processed at 9--10 a.m. in Japanese time zone. Every time it's different, but most time it's between 9 to 10. So It's very possible to be a manual action.
So, I think, If Mark karples falls asleep, he will not reimburse hot wallet, until the next day. So, I think the exact reason why Mtgox scandal happened is either "other unexpected reason" or "Mark Karples think it's better to ran away with the coins in hand because withdrawal surpasses deposit every day". You know when a Ponsi or Hyip ends usually? Perhaps Mark Karples thinks he can run away as easy as other Ponsi guys. It's clear this guy watches /bitcoin all the time and changes his explanation according to what he thought will muddle the water. Mark Karples is a criminal. And I think police is not idiot as he thought.
The volatility of Bitcoin is, I think, universally accepted as "not a good thing" by the community at large who believe in Bitcoin. Over the last week it has become painfully obvious to most that the centralization of our market in MtGox is a critical mistake to the health and future of the Bitcoin economy. That is not to say that MtGox won't be and shouldn't be relevant, but that failures on their side have too large an impact. In other words, we lack options and diversity. In reviewing what I know and have experienced while trading on their platform I've generally found the following to be key failures, lapses, or issues that will impair Bitcoin's ability to be used as a transaction medium and not merely a speculation vehicle. Systems Architecture
Lack of meaningful DDOS mitigation: hardware, software, nor ISP
Poor design: the platform was not built by people with real-world financial experience
Poor programming: wrong language, poor code, poor API
Unacceptable lag in trade executions: we should be expecting sub-second trade executions at all times, 10 second delays should never happen, let alone 1 hour delays
Queue execution fails/ignores Cancels completely during lag
Can only handle < 40 trades per second
Trade fees collected purely on percentages without minimum transaction fees, even an incredibly small minimum fee would help curb high frequency trade attempts designed to manipulate prices
Lack of premium, paid API access for HFT versus rate-limited API access for non-institutional traders
Lack of brokerage-style plugins for API
Lack of graceful degradation in service when overwhelmed
Too much time required for account verifications
Too many limits on money moved in/out of system
Enforced loss of anonymity
Lack of options trading
Lack of margins/ability to short
Lack of support for other cryptocurrencies (LTC coming soon though)
Run by non-native English speakers, difficulties interacting with western market
Established in Japan, where financial regulations, government regulations, and future interference by the state are virtually guaranteed
24/7/365 trading without 24/7/365 support
Essentially the only well-used trading platform for Bitcoin at present
I've been discussing these issues with various technology investors and we all agree that the western hemisphere needs a powerful, independent platform of its own. For instance, a new exchange founded in one of the many tax-havens outside of the U.S. would help avoid future governmental interference and independence for Bitcoin while helping stabilize the overall market. Our general plan is:
Create a new exchange based in a special economic zone with less regulatory review and tax-exempt status
Development will be handled by proven financial programmers with experience from Goldman Sachs and other institutions who already have the expertise to develop millisecond trading platforms in a scaled, secure environment
We believe the ability to have margin accounts and deal with options will greatly stabilize the vicious swings we're seeing in Bitcoin value - when you can only buy low/sell high you're setting up a market for inevitable falls
We'll support multiple crypto-currencies from day one, and forge agreements with as many deposit method providers as possible
A portion of our revenue will go back to Bitcoin development, media exposure, and market pushes into countries not currently being targeted by Bitcoin news (especially in South America)
If you believe there are other failures with MtGox and the other exchanges that we've failed to identify, let us know! We want Bitcoin stable and moving.
Want to leave MtGox? Information on some other exchanges.
bitcoin-24 - Trades mainly in euro. A great exchange for daytraders, 0% fee's and rarely down. For people looking to cash in or cash out this might not be the best choice since there has been reports of very long wait times the last few weeks. It has a pretty nifty statistics & transactions page Deposit options: giropay, SEPA (eur), Bank wire (USD/PLN/GBP), MtGox code, VouchX code. Withdraw options: SEPA / INT Wire (EUUSD), Cash/Parcel, Skrill USD, VouchX coupons. Complete fee list BTC-E - Speculators paradise, has a lot of different currencies & cryptocurrency markets, fee's are moderate (0.2-0.4%) but some withdrawals incur high fees. Exchange location may be shady (it's an Russian exchange i believe). Deposit options, Withdraw options Bitstamp - Trades in USD This seems to be one of the better alternatives if you intend to withdraw or deposit cash. What i have heard there is not long delays when withdrawing or depositing. Fee starts out pretty high though (0.5% for <$500). Deposit options, Withdrawal options. BitFloor - Trades in USD. Another great exchange for daytraders. -0.1% fee on limit orders (yes, they pay you). I believe depositing money is pretty easy if you are from US (info), international wire charge a $15 fee. Also possible to deposit through something called "CapitalOne 360 P2P". Deposits are made through ACH. You will have to provide identification to deposit or withdraw money on this exchange. Also worth noting is that they got hacked last year and have not yet repaid BTC balances. Just interested in depositing money in an easy way? Check if any of these exchanges offer a good solution for you: CampBX (US), btcchina (CN), VirtEx (CA), bitcoin.de (DE), bitcurex (PLN), kapiton (SE). Fuck traditional exchanges, right? bitcoinary, localbitcoins and i believe bitcoin.de (DE) is also not an traditional exchange. ripple?
Question and comment from a newbie for those with some experience in bitcoin.
There are a few things I want to understand before I buy bitcoin. The FAQs are very sparse on Coinbase and the various exchanges(that was the comment). Question is about deposit and withdraw. Some of these places have fees and/or delays associated with deposits and withdrawal. What I want to know(while I wait patiently for coinbase to verify my account) is: do these fees and delays apply to bitcoin or other currency also, or is this just about cash? I mean, if I buy coin at coinbase, then want to move it to mtgox to buy a bit of some other coin as well, am I going to have to wait, and pay a percent of my bitcoin either to coinbase or mtgox, or both just for moving it, in addition to the fees I will pay for the exchange of dollars-to-bitcoin at coinbase and bitcoin to LTC or WDC at gox(or wherever)? I keep reading the help files at different sites, and I just can't find anything that's clearly, unequivocally phrased to my satisfaction.
(There is no traffic on the r/mtgox that's why I have to post here. Sorry ) As MtGox is the biggest exchange most of you are trading there. What... The delay will, consequently, enable the two parties to make informed recommendations to the federal court in Los Angeles on how the case should proceed. More than US$0.6 Billion Raised. This comes after the Mt Gox civil rehabilitation and bankruptcy trustee, Nobuaki Kobayashi, revealed last month that he had raised over US$617 million following the sale of bitcoins that were recovered. The ... However Mt Gox reports major IT and banking upgrades are on the way. Those in the retail forex world — who know the importance of immediate deposits and providing the immediate ability to trade once a client decides to deposit money to his/her account — will understand how serious an issue has been at play at Bitcoin exchange Mt Gox for the past several weeks. The delay will, consequently, enable the two parties to make informed recommendations to the federal court in Los Angeles on how the case should proceed. More than US$0.6 Billion Raised This comes after the Mt Gox civil rehabilitation and bankruptcy trustee, Nobuaki Kobayashi, revealed last month that he had raised over US$617 million following the sale of bitcoins that were recovered. “When a user wished to deposit money in their Mt. Gox account, Mizuho would accept the payment that had been wired through the user’s outside banks and deposit the funds into Mt. Gox’s Mizuho account. Such wire transfers not only designated Mt. Gox as the beneficiary of the wire and Mizuho as the beneficiary’s bank, but also included the Mt. Gox user’s account number to which the ...
Transcript: Hello, I'm Roger Ver, long time Bitcoin proponent. About 7 months ago, purely as a favor to Mtgox, I made a video stating that their fiat withdrawal problems were not being caused by a ... My Second Channel: https://www.youtube.com/channel/UCvXjP6h0_4CSBPVgHqfO-UA ----- Supp... BITCOIN JUST CRASHED HARD! YOU NEED TO KNOW RISK MANAGEMENT. In todays video i give a brief risk management tutorial for when you are leverage trading bitcoin on bybit or duedex. Duedex has a risk ... News Bits on: - Mtgox Bankruptcy claims on their way - Winklevoss Twins Eat, Sleep, Breathe Bitcoin - Richard Branson Bitcoin Summit on his Private Island ... Originally published on February 26, 2014 ----- Mt. Gox, the world's biggest bitcoin exchange, stopped trading on Monday after losing a large amount of the virtual currency in apparent hacking ...