Bitcoin Forum

MTgox.com and other BitCoin services have been under attack a little after Gavin presented to the CIA.  So far, posts by a user supposedly representing btcex claims MTgox is taking all the exchange business, seems to be taking credit.  Along about the same time, PayPal decided to discontinue exchange of dollars to BTC.  I would like to point out some things that many may not be considering...

1. On 5/9, the Forbes article comes out in print.  This will be BitCoin's first exposure to major investors.
2. MTGox is the main exchange for BTC and dollars.  There is really no other service out there that does the same volume.
3. In order to convince merchants to use BTC, they will need a way to convert BTC back to state sponsored currency without the fear of getting in and out.
4. These attacks have cooled the recent BTC rally.

If you think about the psychological impact of the attacks on those just now learning about BitCoin for the first time, what would you conclude about BitCoin?  It would be something like: "Cool idea, but I need to be able to change the BitCoins back to dollars on a short notice, and cannot be hassled with this play money."  If the exchanges fail to provide quick liquidity, then BTC value will be stunted.

Like it or not, the exchange services will be a key part of BitCoin acceptance and success.

I disagree. Converting BTC to fiat currency is a crutch, just to get things started. Once you can buy anything in BTC it will be inefficient to convert to other currencies and most of the exchanges will die off. I say this as the owner and operator of an exchange. I look forward to the day when my service is obsolete. ;D

Crutch or not, most things are still purchased with state supported currency.  Without exchanges such as yours, it will take much longer for BitCoin to become accepted. 

May your exchange prosper to the point of obsolescence.  ;)

I disagree. BTC is a store of value and it doesn't require merchants to accept them in order to have value.

Maybe, but I'm not sure bitcoins would have much value to store if they're not also used as a medium of exchange.

Correlation != causation.

Information service providers, programmers, and other people play key roles in todays businesses.
If they would choose not to accept other currencies, and demand for bitcoins, bitcoins would grow in value.
In addition, such people are free to choose to be motivated to help to businesses, which agree to sell their products in bitcoins.

1) Choose your beloved retail product, such as a burger,
2) Offer your services, such as promotion, extravagant website, etc.
3) Convince that "you will have all these, just agree to accept bitcoins for your product. I will accept them from you for my services, and my programmer friends will also be glad to help you with your business, if only you will accept bitcoins for your burgers."

The possibilities are endless...

that'll probably take decades, if it ever happens at all.


we can be happy if they choose to accept bitcoins, but why would anyone choose not to accept other currencies?

Sure, it is not necessary to do that, it is sufficient to make the prices of your services in dollars sufficiently greater than the prices in bitcoins, to make it more attractive for people to exchange their dollars to bitcoins before buying something.

Bingo! :)

That you have described is true, but that's not all problems. The most important thing is that in fact never will be possible safety centralized exchange of bitcoins to an any fiat money. (Because fiat money (bank transfers etc) are refundable in the same way as Paypal. Just a little more difficult to return them, but you can do it for a large sum.)

And most will be doomed forever to expect output of bitcoins into any other surrogate money like LR with approx. limit $1000 per day for all users(!) of the exchange.

Thus, easiest way to withdraw money from mtgox is withdraw bitcoins, but outside of mtgox price $3.5 are not wanted. (Last traded price in WMZ (webmoney US dollars) is $2.8 on our exchange at present time). Therefore, the pyramid will grow more and more. Inside mtgox.

I thought Gavin hadn't presented to the CIA yet...


+1

How can people possibly spend their BTC without any idea what it's worth?

All the lack of an exchange is going to do is make everyone stop trading until the exchange comes back. I can't do business with my bitcoins ANYWHERE without mtgox's exchange rate.  They are worthless keys on my HD. A point of failure that needs to be fixed? sure.  The right way to bring about this change? nope.

Fiat would still get used if all the world's financial markets went down because everyone already has it already. This is kicking BTC it it's infancy. The fact that the responsible guy thinks he is doing everyone a favor shows how badly this world needs education. In a currency where trust/reputation are everything, I couldn't think of a stupider move.

I hope they get shoved off the internet forever. Where do I send my -10? :(

User bitcoinex was the one who admitted to the DDOS (at least, the one a few days ago) in another thread, but I can't for the life of me find the post now.   I'm surprised there isn't more community backlash- btcEX is still listed on bitcoinwatch/charts, even.

Maybe not many people know who's responsible. Anyone wanna help me with the forum search? I'll be glad to make a big deal of it once found.

I may stand corrected.  There was a series of events just after the CIA announcement.

Whoa there. Where are you getting information from? Gavin has not presented to the CIA and is not scheduled to until June. The Forbes article is already been out for a while magazines hit stands before their date.

https://mtgox.com is working.

vladimir try accessing it via https

No problem. MagicalTux said it was proxy misconfiguration on the ISP side and will be sorted soon

Price is probably affected by the fact, that BTC withdrawal doesn't work on BTCex.

No, Gavin has not yet spoken at the CIA.  

There are ALWAYS a series of events happening.  This is the world of Bitcoin. Everything happens fast.  The events are not necessarily related to each other in any way.

MtGox has been working very hard to get itself DDoS protection - lots of cool tech involved.  As you can see, it's back & stronger than ever.

And so is the price...   $3.71 ......back on the rise.

As for BTCex, no one in their right mind would trust that liar.  Bitcoin withdrawal is temporary disabled for technical reasons? ?   I bet the bitcoin DEPOSIT function works just fine, however....   LOL

"The backup system works perfectly, sir.  It's the restore system that's not working."  LOL

A serious discussion about exchange sites will require a Bitcoin Legal Thinktank (made up of actual lawyers, regulators and such).  It's all about the legal issues. The tech issues are easy by comparison.     See my other thread about our forming exactly that.

http://bitcointalk.org/index.php?topic=7571.0

Interesting Reading....

 Read the Russian language section of this Forum... through the Google Translator:

http://translate.google.com/translate?hl=en&sl=ru&tl=en&u=http%3A%2F%2Fbitcoin.org%2F