Bitcoin Forum

Economy => Service Announcements => Topic started by: shtylman on September 04, 2012, 05:08:52 PM



Title: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:08:52 PM
As much as I regret the post I am about to write I feel that it is only fair and holding to the spirit of BitFloor that I disclose everything that is going on and make the information available. Please read the entirety of the post. As always, if you have any questions please post them here versus contacting support so that other users may benefit from the answer (unless it is private).

Last night, a few of our servers were compromised. As a result, the attacker gained accesses to an unencrypted backup of the wallet keys (the actual keys live in an encrypted area). Using these keys they were able to transfer the coins. This attack took the vast majority of the coins BitFloor was holding on hand. As a result, I have paused all exchange operations. Even tho only a small majority of the coins are ever in use at any time, I felt it inappropriate to continue operating not having the capability to cover all account balances for BTC at the time.

Due to the serious nature of what has happened I am currently evaluating options for BitFloor. One of the last things I want to happen is for BitFloor to shutdown and cause more panic in the bitcoin community. The platform itself is very valuable and provides an important and friendly service to many users.
BitFloor is very much focused on the end user and creating a reliable and trusted platform for everyone. Through exchange user support, I can continue to operate BitFloor. I believe that posting the exchange source and being even more transparent about operations would be a step in this direction if we were to continue operating. BitFloor is currently the #4 USD exchange and #1 in the US.

As a last resort, I will be forced to fully shut BitFloor down and initiate account repayment using current available funds. I still have all of the logs for accounts, trades, transfers. I know exactly how much each user currently has in their account for both USD and BTC. No records were lost in this attack.

I realize that saying that I appreciate everyone's understanding is a moot point, however I do wish to re-iterate that my goal is to find the best and most reasonable way forward for BitFloor customers and the exchange and not create more panic that the community has already seen time and time again.

I would like to keep this thread focused on evaluating ideas of BitFloor operation and will create a separate thread for discussion (see below) about the actual transactions and tracing the coin theft. I will not speak at detail about the actual breach at this time as my current focus is on the future and not the past.

In the intrest of information for tracking stolen coins:
https://bitcointalk.org/index.php?topic=105819.0

~Roman


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 05:16:19 PM
Please quantify the amount of BTC lost as well as the total BTC owed.
What % of BTC were lost?

From the tx it looks like 30K BTC in outputs (although one involved two large outputs so it is unclear what is going on there).

Was there a loss of any USD funds?


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:18:16 PM
Please quantify the amount of BTC lost as well as the total BTC owed.
What % of BTC were lost?

From the tx it looks like 30K BTC in outputs (although one involved two large outputs so it is unclear what is going on there).

This was almost all of the BTC.

Was there a loss of any USD funds?

No. All USD bank accounts are secure. And all records for the current status of the exchange (accounts, trades, etc) are all also secure.


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 05:19:25 PM
unencrypted backup ??????


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:21:02 PM
unencrypted backup ??????

Yes. It was made when I manually did an upgrade and was put in the unencrypted area on disk. I realize the details of the failure and attack are interesting but I am currently focused on user accounts and exchange status going forward.


Title: Re: bitfloor needs your help!
Post by: nimda on September 04, 2012, 05:21:37 PM
How long, given average operation, would it take to regain the 25K in fees?


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 05:21:41 PM
Oh well that is worse by the description above I thought only the hot wallet funds were lost.  So there was an online plaintext copy of the cold wallet?

So ~30K of ~30K in BTC has been lost?


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:23:02 PM
So ~30K of ~30K in BTC has been lost?

The amount totals to ~24K BTC.


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 05:24:18 PM
I understand they can decrypt and use that coin tell me your website or even anything if u want me to secure :) email us we will investigate

cyberwings.gov.pk@gmail.com


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 04, 2012, 05:24:43 PM
So ~30K of ~30K in BTC has been lost?

The amount totals to ~24K BTC.

Why was the majority of this not in a cold wallet?

How long under normal operation would it take for BitFloor to recoup the loss in the form of fees?


Title: Re: bitfloor needs your help!
Post by: edd on September 04, 2012, 05:25:39 PM
What kind of help do you need?

Bitfloor provided a great service and I'm willing to forego collecting my meager holdings of 2.98 BTC if it helps at all with paying out other customers wishing to withdraw.

If there is any way I can help as a bitcoin business owner, please PM me.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:26:47 PM
How long, given average operation, would it take to regain the 25K in fees?

We have seen steady growth over the last few months but our 30 day volume is ~64K BTC (717K USD) and given that we get 0.3% from each trade this means we make roughly 2.1k per month in USD (210 BTC at current rate). So quite a long time if trading did not ramp up. Regardless of the recovery time I felt it important to make this announcement as it impacts many users and the community.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 05:28:28 PM
Why was the majority of this not in a cold wallet?

This. 

Based on the OP I assumed (incorrectly) that the attacker "only" got 100% of the hot wallet.

Quote
Even tho only a small majority of the coins are ever in use at any time


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 05:28:47 PM

Why was the majority of this not in a cold wallet?




hey, I realize this is an interesting question, but we are focused on the future here

 ::)


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:29:56 PM
Why was the majority of this not in a cold wallet?

This. 

Based on the OP I assumed (incorrectly) that the attacker "only" got 100% of the hot wallet.

Quote
Even tho only a small majority of the coins are ever in use at any time


Yes. I realize this. I cannot undo it (believe me, I would if I could).


Title: Re: bitfloor needs your help!
Post by: TangibleCryptography on September 04, 2012, 05:33:47 PM
Since neither the USD balances nor account records have been compromised please process scheduled ACH withdraws.

We have a pending ACH withdraw which should be processed today.
Should we send ACH withdraw request for the balance by email since the site will be down for the immediate future?


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 04, 2012, 05:34:46 PM
Quote
Even tho only a small majority of the coins are ever in use at any time

I guess what this means is that he realizes that he could have continued operating under a fractional banking model but chose not to.  Which is good.

This also means most of the coins should have been in cold storage, but they weren't.  Which is bad.


So far BitFloor has been great.  I would want the service to continue operation.

Could you secure some investor funds to pay back losses to customers now, and payback the investor after your business picks back up?


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:35:21 PM
Since neither the USD balances nor account records have been compromised please process scheduled ACH withdraws.

We have a pending ACH withdraw which should be processed today.
Should we send ACH withdraw request for the balance by email since the site will be down for the immediate future?

ACH withdrawals placed before the compromise have been processed. New withdrawals are currently on hold while I work through the future of the exchange.


Title: Re: bitfloor needs your help!
Post by: BoardGameCoin on September 04, 2012, 05:36:52 PM
So far BitFloor has been great.  I would want the service to continue operation.

Could you secure some investor funds to pay back losses to customers now, and payback the investor after your business picks back up?

+1

I'm out ~ 30 BTC on this one. Probably not as many, but I was intending to get those coins off the exchange soon.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:37:01 PM
Could you secure some investor funds to pay back losses to customers now, and payback the investor after your business picks back up?

This would be a possibility if investors interested in helping continue operations show interest. It is certainly something I am thinking about.


Title: Re: bitfloor needs your help!
Post by: dooglus on September 04, 2012, 05:38:29 PM
Based on the OP I assumed (incorrectly) that the attacker "only" got 100% of the hot wallet.

It sounds as if the attacker only got the hot wallet, but that unfortunately there was no cold wallet.

It beggars belief that people are still not using offline wallets for the majority of the coins they're responsible for.


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 05:39:40 PM
Why was the majority of this not in a cold wallet?

This. 

Based on the OP I assumed (incorrectly) that the attacker "only" got 100% of the hot wallet.

Quote
Even tho only a small majority of the coins are ever in use at any time


Yes. I realize this. I cannot undo it (believe me, I would if I could).

Wow... just wow.

I thought you were better than that.

I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:40:14 PM
It beggars belief that people are still not using offline wallets for the majority of the coins they're responsible for.

Yes, I realize this is a very serious mistake.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 04, 2012, 05:40:59 PM
Could you secure some investor funds to pay back losses to customers now, and payback the investor after your business picks back up?

This would be a possibility if investors interested in helping continue operations show interest. It is certainly something I am thinking about.

Do you have enough funds to cover this loss yourself?

I am having trouble thinking of other options that would allow for trading to resume, without turning to a fractional model, that dont include acquiring new large sums of money.


Title: Re: bitfloor needs your help!
Post by: EnergyVampire on September 04, 2012, 05:41:13 PM
I'm not sure why an unencrypted wallet would reside on an unencrypted disk but...

BitFloor should continue operations. Get rid of the Cloud though.

BitFloor will make up the lost coins in due time with regular operations.


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 05:41:32 PM
your server were not hacked i didnot see any defacing issue some account were compromised only but your server are not hacked those were not a russian hacker's they were some other countries hacker


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 05:42:27 PM
I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

I don't wish to go into too many details on this thread about it, but this box was not public facing.


Title: Re: bitfloor needs your help!
Post by: TangibleCryptography on September 04, 2012, 05:43:56 PM
New withdrawals are currently on hold while I work through the future of the exchange.

That is unacceptable.  Regardless of the future of the exchange you have an obligation to disburse funds to the ACH account on record.  You previously handled requests by email.  USD funds by depositors are the property of the depositor and not an investment.  You have no legal standing to hold those funds pending "anything".


Title: Re: bitfloor needs your help!
Post by: ThomasV on September 04, 2012, 05:44:40 PM
Minimal quality standard I expect from an exchange: https://bitcointalk.org/index.php?topic=83933.0


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 05:45:08 PM
let the bank run begin


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 05:45:29 PM
check your ssl certificate next time and i am thinking tht u are using vps instead of shared right ?


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 05:45:42 PM
Could you secure some investor funds to pay back losses to customers now, and payback the investor after your business picks back up?

This would be a possibility if investors interested in helping continue operations show interest. It is certainly something I am thinking about.

Perhaps a GLBSE offering could help make up the difference.  But first you need to develop and publish a better security model and have the community scrutinize it.


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 05:47:48 PM
Bitfloor lost about 25k BTC, or ~250k USD... It's somewhat hard to get these funds now. Even if it was sold, the evaluation is less than 25k USD (2k * 12 months).

Its pretty much bankruptcy for bitfloor.


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 05:48:54 PM
I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

I don't wish to go into too many details on this thread about it, but this box was not public facing.

So someone with physical access got in.  If that's the case you should absolutely file a police report.  $250,000 is way past misdemeanor level and there are a limited number of people with physical access.

But wait, you listed the IP address the attacker connected from in the other thread so maybe it wasn't physical access.  So which was it?  Was it accessible from the internet, or was it not?


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 05:50:55 PM
I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

I don't wish to go into too many details on this thread about it, but this box was not public facing.

So someone with physical access got in.  If that's the case you should absolutely file a police report.  $250,000 is way past misdemeanor level and there are a limited number of people with physical access.

But wait, you listed the IP address the attacker connected from in the other thread so maybe it wasn't physical access.  So which was it?  Was it accessible from the internet, or was it not?

hackers were using vpn not real those are proxy not the ip we can track the ip address which he listed here then we can see is this vpn if yes what was the ISP


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 05:52:27 PM
1nject0r,

The grown ups are talking please STFU!  The nonsensical ramblings of a 2bit warez seller are not welcome or needed.


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 05:54:54 PM
1nject0r,

The grown ups are talking please STFU!  The nonsensical ramblings of a 2bit warez seller are not welcome or needed.

He's amusing. He's like what we would see if Phinn went into the "h4x0ring" business instead of fruitlessly doxing in all the wrong places.  ;D


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 05:55:40 PM
1nject0r,

The grown ups are talking please STFU!  The nonsensical ramblings of a 2bit warez seller are not welcome or needed.

Secure your website first then bark in front of us u fucking k1d u really cant compare us :D so grew up and secure all bitcoins site then bark here


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 06:00:58 PM
1nject0r,

The grown ups are talking please STFU!  The nonsensical ramblings of a 2bit warez seller are not welcome or needed.


fastcash4bitcoins.com lOl javascript 1njection lOL

Quote
Runtime Error
Description: An application error occurred on the server. The current custom error settings for this application prevent the details of the application error from being viewed remotely (for security reasons). It could, however, be viewed by browsers running on the local server machine.

Details: To enable the details of this specific error message to be viewable on remote machines, please create a <customErrors> tag within a "web.config" configuration file located in the root directory of the current web application. This <customErrors> tag should then have its "mode" attribute set to "Off".

<!-- Web.Config Configuration File -->

<configuration>
    <system.web>
        <customErrors mode="Off"/>
    </system.web>
</configuration>


Notes: The current error page you are seeing can be replaced by a custom error page by modifying the "defaultRedirect" attribute of the application's <customErrors> configuration tag to point to a custom error page URL.

<!-- Web.Config Configuration File -->

<configuration>
    <system.web>
        <customErrors mode="RemoteOnly" defaultRedirect="mycustompage.htm"/>
    </system.web>
</configuration>[/B]


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 06:01:25 PM
I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

I don't wish to go into too many details on this thread about it, but this box was not public facing.

So someone with physical access got in.  If that's the case you should absolutely file a police report.  $250,000 is way past misdemeanor level and there are a limited number of people with physical access.

But wait, you listed the IP address the attacker connected from in the other thread so maybe it wasn't physical access.  So which was it?  Was it accessible from the internet, or was it not?

hackers were using vpn not real those are proxy not the ip we can track the ip address which he listed here then we can see is this vpn if yes what was the ISP

No shit sherlock, but that's is irrelevant to my question.  He claims "this box was not public facing", then provides an ip that the attacker connected from.  So which is it?  How did the attacker connect to a box that was not accessible?


Title: Re: bitfloor needs your help!
Post by: 1nject0r on September 04, 2012, 06:04:00 PM
Quote

No shit sherlock, but that's is irrelevant to my question.  He claims "this box was not public facing", then provides an ip that the attacker connected from.  So which is it?  How did the attacker connect to a box that was not accessible?


there are no proof that hacker hack his site maybe some other problem he faced but hacker didnot hack his website no record of hacker or hacking


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 06:07:07 PM
fucks sake 1nject0r

at least turn off the bold


Title: Re: bitfloor needs your help!
Post by: BadBear on September 04, 2012, 06:08:38 PM
Quote

No shit sherlock, but that's is irrelevant to my question.  He claims "this box was not public facing", then provides an ip that the attacker connected from.  So which is it?  How did the attacker connect to a box that was not accessible?


there are no proof that hacker hack his site maybe some other problem he faced but hacker didnot hack his website no record of hacker or hacking

Are you even reading what you're replying to?

And stop with the bold, there's no reason to bold everything you say since it's nonsense anyway.


Title: Re: bitfloor needs your help!
Post by: epetroel on September 04, 2012, 06:11:27 PM
1nject0r,

The grown ups are talking please STFU!  The nonsensical ramblings of a 2bit warez seller are not welcome or needed.


fastcash4bitcoins.com lOl javascript 1njection lOL

Quote
<snip standard ASP.NET error page>

All this shows is that you managed to create a server-side error and he doesn't have any custom error pages.  

As a matter of fact, the server side error generated was probably because of your attempt at Javascript injection (caught harmlessly by ASP.NET)

So what exactly are you trying to show with this?


Title: Re: bitfloor needs your help!
Post by: mufa23 on September 04, 2012, 06:11:34 PM
Shtylman, thanks for coming clean rather then pulling an MtGox and leaving everyone in the dark for weeks.

I have a question for you, I'll PM it.


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 06:12:02 PM
Quote

No shit sherlock, but that's is irrelevant to my question.  He claims "this box was not public facing", then provides an ip that the attacker connected from.  So which is it?  How did the attacker connect to a box that was not accessible?


there are no proof that hacker hack his site maybe some other problem he faced but hacker didnot hack his website no record of hacker or hacking

So did you hack fastcash4bitcoins yet? No? Then STFU script kiddo. The server is properly configured not to display errors, and that what I do when someone tries to exploits the normal operation of the site - display a generic error page and log the attacker's information.


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 06:12:57 PM
Quote

No shit sherlock, but that's is irrelevant to my question.  He claims "this box was not public facing", then provides an ip that the attacker connected from.  So which is it?  How did the attacker connect to a box that was not accessible?


there are no proof that hacker hack his site maybe some other problem he faced but hacker didnot hack his website no record of hacker or hacking

Still irrelevant.  Maybe try understanding the question.  It still won't help though since the question isn't directed to you and you don't know the answer.  A system, holding an unencrypted copy of the keys was hacked.  He claims this system was not public facing, yet he also claims that the attacker connected from a specific IP.  If the system was not public facing, how did the attacker connect to it?


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 06:15:34 PM
I think what Bilaal here is trying to imply is that he thinks there was no hacker at all and it was a inside job (another mybitcoin/zhoutong situation). Which is the only way a non-public facing system could be compromised.


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 06:16:50 PM
ignore button engaged


Title: Re: bitfloor needs your help!
Post by: BitPay Business Solutions on September 04, 2012, 06:18:56 PM
ignore button engaged

man, that was easy


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 06:19:03 PM
Still irrelevant.  Maybe try understanding the question.  It still won't help though since the question isn't directed to you and you don't know the answer.  A system, holding an unencrypted copy of the keys was hacked.  He claims this system was not public facing, yet he also claims that the attacker connected from a specific IP.  If the system was not public facing, how did the attacker connect to it?

The system was connected to from one of our other boxes which was accessed through a virtual console. The wallet box had all public ports blocked but was able to be connected to from a few of the other boxes.


Title: Re: bitfloor needs your help!
Post by: mufa23 on September 04, 2012, 06:22:01 PM
And stop with the bold, there's no reason to bold everything you say since it's nonsense anyway.
yeah i know what i have wrote  and if bold is not allowed why dont u disable bold tags instead of saying to me ?

inb4 ban


Title: Re: bitfloor needs your help!
Post by: notme on September 04, 2012, 06:27:24 PM
Still irrelevant.  Maybe try understanding the question.  It still won't help though since the question isn't directed to you and you don't know the answer.  A system, holding an unencrypted copy of the keys was hacked.  He claims this system was not public facing, yet he also claims that the attacker connected from a specific IP.  If the system was not public facing, how did the attacker connect to it?

The system was connected to from one of our other boxes which was accessed through a virtual console. The wallet box had all public ports blocked but was able to be connected to from a few of the other boxes.

Thanks for confirming.  This is why I prefer no incoming connections allowed on the secure box.  If you must have occasional ssh, you can have it enabled on boot and then login to disable it.  That way you can reboot first if you must login.


Title: Re: bitfloor needs your help!
Post by: mc_lovin on September 04, 2012, 06:37:36 PM
ouch.  best of luck resolving this one.. another lesson learned by server admins about hot wallets..


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 04, 2012, 06:41:03 PM
So I got a grand in USD in my account. How do I get it back asap?


Title: Re: bitfloor needs your help!
Post by: smickles on September 04, 2012, 06:43:32 PM
ouch.  best of luck resolving this one.. another lesson learned by server admins about hot wallets..
what makes you so sure it was learned? This occurrence seems to indicate that hot wallets are still used or at least used improperly.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 06:44:55 PM
I likewise wish to withdraw my remaining USD balance. Since you said all the USD balances are okay and you have all the account records, it should be no problem for you to re-enable enough parts of the site for us to log in and initiate ACH withdrawals. Please don't hold our USD hostage; that would very quickly make you look like the bad guy.


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 06:49:04 PM
Sorry to hear this, shtylman. Bitfloor is a helluva lot cheaper and more convenient than the clip joints being called exchanges out there.

Much luck to you all.


Title: Re: bitfloor needs your help!
Post by: davout on September 04, 2012, 06:51:12 PM
Very sorry to hear that.  :(


Title: Re: bitfloor needs your help!
Post by: IveBeenBit on September 04, 2012, 06:53:14 PM
I likewise wish to withdraw my remaining USD balance. Since you said all the USD balances are okay and you have all the account records, it should be no problem for you to re-enable enough parts of the site for us to log in and initiate ACH withdrawals. Please don't hold our USD hostage; that would very quickly make you look like the bad guy.

I agree. I hope you can recover from this and re-emerge as a viable exchange. There is very little you can do right now and holding onto our USD will not help get the stolen bitcoins back. Making it difficult or a PITA for us to recover our USD, however will be detrimental to the Bitfloor brand and good will that you have earned in the past.

If you could reenable the site so we can make withdrawal requests that would be nice. I'd also like to double check if I had a bitcoin balance on your site. I'm pretty sure I don't, but need to log on to verify.

Rebuilding your exchange will probably take months. Delaying our USD withdrawals will not speed that up any.


Title: Re: bitfloor needs your help!
Post by: adamstgBit on September 04, 2012, 06:54:20 PM
New withdrawals are currently on hold while I work through the future of the exchange.

That is unacceptable.  Regardless of the future of the exchange you have an obligation to disburse funds to the ACH account on record.  You previously handled requests by email.  USD funds by depositors are the property of the depositor and not an investment.  You have no legal standing to hold those funds pending "anything".

Since it seems shtylman missed it.  

Let me make it more clear.  You wanting to continue bitfloor is admirable but it has absolutely nothing to do with client funds.  The only purpose of those funds is for CLIENT to purchase bitcoins.  Since that is no longer possible the funds should be returned immediately.  Not in week, not in a month, not after you get "hacked" again and the attacker makes a bank wire withdraw of all the USD funds to some foreign bank.



ya sending everyone's money back seems like a good first step.

then rebuild a better system, and start making money again.


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 06:56:04 PM
Bitfloor is a helluva lot cheaper and more convenient than the clip joints being called exchanges out there.

I wonder why...


Title: Re: bitfloor needs your help!
Post by: Dansker on September 04, 2012, 06:56:59 PM
How about this:

You repay any USD-deposits, since they are all in tact.

You then re-pay what you can of the remaining BTC deposits.

You will then re-do your security, and publicly post how it will be done right from now on.

You will then re-pay the users who have deposited BTC which you can no longer repay with the incoming transaction fees, untill you have repaid everyone.

Then you will (after a year or two) start making money again. Running the operation untill then will have to be based on your hard work, and possibly investors investing into the company.

Disclosure: I am not invested in any way with any parties to this.


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 07:01:10 PM
Bitfloor is a helluva lot cheaper and more convenient than the clip joints being called exchanges out there.

I wonder why...

Are you saying that paying a 5% fee will ensure security?


Title: Re: bitfloor needs your help!
Post by: DigitalHermit on September 04, 2012, 07:03:22 PM
Bitfloor is a helluva lot cheaper and more convenient than the clip joints being called exchanges out there.

I wonder why...

Are you saying that paying a 5% fee will ensure security?

... as in pay 5% now or 100% later?  :P


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 07:04:53 PM
How about this:

You repay any USD-deposits, since they are all in tact.

You then re-pay what you can of the remaining BTC deposits.

You will then re-do your security, and publicly post how it will be done right from now on.

You will then re-pay the users who have deposited BTC which you can no longer repay with the incoming transaction fees, untill you have repaid everyone.

Then you will (after a year or two) start making money again. Running the operation untill then will have to be based on your hard work, and possibly investors investing into the company.

Disclosure: I am not invested in any way with any parties to this.

25k BTC is a lot of money. With the current valuation it will take 10 years to repay. And certainly this incident won't increase volume for bitfloor.

Sad.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:05:33 PM
You repay any USD-deposits, since they are all in tact.

You then re-pay what you can of the remaining BTC deposits.

Customer assets are customer assets.  It doesn't matter if they are dollars, bitcoins or bananas.  If BitFloor does not have reserves (and that was reported in OP) or any other way to make customers whole, then this is a bankruptcy case.  This exchange is operating in the U.S., there are very specific laws as to how to proceed.

Disbursing funds to some customers and not others would be a criminal act under those.

I believe a court order (injunction) should be filed to help ensure the exchange operator proceeds as prescribed by law.

[Edited, s/funds/assets/.  and added.]


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 07:07:59 PM
Bitfloor is a helluva lot cheaper and more convenient than the clip joints being called exchanges out there.

I wonder why...

Are you saying that paying a 5% fee will ensure security?

You can't "ensure" security. You can strive to maximize security however.

Like taking that 5% fee and paying someone who knows something about security to have a look at your stuff and point out obvious weaknesses like "unencrypted copy of the wallet keys" lying around on "supposedly non-public-facing" servers with open connections to public facing servers.


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 04, 2012, 07:11:55 PM
Disbursing funds to some customers and not others would be a criminal act under those.

I believe a court order (injunction) should be filed to help ensure the exchange operator proceeds as prescribed by law.

Bitcoins were stolen, not cash. That cash is not Bitfloors to distribute to other customers. It's mine.


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 07:13:27 PM

Like taking that 5% fee and paying someone who knows something about security to have a look at your stuff and point out obvious weaknesses like "unencrypted copy of the wallet keys" lying around on "supposedly non-public-facing" servers with open connections to public facing servers.

Or maybe one should be responsible for one's own money and btc and not leave them sitting on other peoples' servers for extended periods? Would you leave your wallet and house keys next to someone on the subway to watch for you? You gave him five bucks. He said he'll do his best.


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 07:15:32 PM
Like taking that 5% fee and paying someone who knows something about security to have a look at your stuff and point out obvious weaknesses like "unencrypted copy of the wallet keys" lying around on "supposedly non-public-facing" servers with open connections to public facing servers.

Or maybe one should be responsible for one's own money and btc and not leave them sitting on other peoples' servers for extended periods? Would you leave your wallet and house next to someone on the subway to watch for you? You gave him five bucks. He said he'll do his best.

That too of course.  ;)


Title: Re: bitfloor needs your help!
Post by: kangasbros on September 04, 2012, 07:16:02 PM
Wow... just wow.

I thought you were better than that.

I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

Hmm, do you mean that the outgoing transfers should always be done from separate server manually? So no automated transfers?


Title: Re: bitfloor needs your help!
Post by: JayCoin on September 04, 2012, 07:21:36 PM
Few questions:

Where your servers VPS?

Who hosted your servers?


 


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 07:22:22 PM
Wow... just wow.

I thought you were better than that.

I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

Hmm, do you mean that the outgoing transfers should always be done from separate server manually? So no automated transfers?


Not really. A hot wallet server can connect to the exchange, listen for transfers, validate transfers to any issues (like requests from wrong ips, large transactions, etc) and automatically process them.

The server doesn't need to be accessible from outside.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 07:22:51 PM
Wow... just wow.

I thought you were better than that.

I never store keys on a webserver for a project involving customer funds.  If all monies belong to the site operator that's their business, but if there are customer accounts I refuse to write code for someone who isn't willing to put the keys on a separate, heavily locked down server (preferably with no public ip).

Hmm, do you mean that the outgoing transfers should always be done from separate server manually? So no automated transfers?

Well he didn't mean that but yes a cold wallet with batch processing is another option.  I would point out that even if a hot wallet is needed, if the hot wallet wallet had say 10% of total funds then 90% of the BTC would still remain right now.  The attacker would have stolen ~2,500 BTC not 25,000.  If using a split wallet like that occassional the hot wallet can run out of funds and clients will experience a delay.

There is no single solution which meets the needs of every single service provider.  That being said having a hotwallet with 100% of the funds is simply inexcusable.   More than anything else it is sad.   Bitfloor was growing rapidly and was a great source of liquidity outside of MtGox (which is important IMHO).  It is destroyed now and honestly shtylman is better than that.


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 07:23:08 PM
Few questions:

Where your servers VPS?

Who hosted your servers?


 

from whois


Name Servers:
   ns1.linode.com
   ns2.linode.com
   ns3.linode.com
   ns4.linode.com


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 07:25:54 PM
That too of course.  ;)

Isn't it odd that personal responsibility is always down further on the list? : )


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 07:27:26 PM
That too of course.  ;)

Isn't it odd that personal responsibility is always down further on the list? : )

It's very human at least.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:27:56 PM
Disbursing funds to some customers and not others would be a criminal act under those.

I believe a court order (injunction) should be filed to help ensure the exchange operator proceeds as prescribed by law.

Bitcoins were stolen, not cash. That cash is not Bitfloors to distribute to other customers. It's mine.

Doesn't work that way in the U.S.

A quick search and I couldn't find the exact description about how customer funds are pooled (giving a net balance), regardless if the account had a balance of securities or cash, then disbursed.  

Here's from Canada, which is pretty much the same in the U.S.

Quote
The customer pool fund includes all securities owned by a bankrupt securities firm, and all securities and cash held by or for the account of both the securities firm and every customer of the securities firm, other than customer name securities. The customer pool fund is allocated first to cover the costs of administering the bankrupt estate and then to cover customer claims in proportion to each customers net equity position.

 -- http://www.cipf.ca/Public/FAQ/Coverage/PartXII.aspx


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 04, 2012, 07:29:49 PM
shtylman, what does "currently evaluating" mean?  Do you have the ability to pay for 24k BTC out of your own pocket, or are you looking for outside investments?  I appreciate you being upfront about the attack, but do I have any hope of seeing any of my deposited BTC again?

Also, to those saying that USD should be paid out - no, it should not.  If Bitfloor does indeed default on its obligations, then a court ruling would have it pay out equally to remaining creditors.  Not 100% to USD creditors, and 2% to BTC creditors.  Therefore, shtylman should hold on to any USD he has until he has decided what course of action to take, and use it to pay out on claims on a bankruptcy liquidation, should it come to that.


Title: Re: bitfloor needs your help!
Post by: BitPay Business Solutions on September 04, 2012, 07:30:20 PM
There is no single solution which meets the needs of every single service provider.  That being said having a hotwallet with 100% of the funds is simply inexcusable.   More than anything else it is sad.   Bitfloor was growing rapidly and was a great source of liquidity outside of MtGox (which is important IMHO).  It is destroyed now and honestly shtylman is better than that.

Agreed.  If Roman really learns as much as possible from this, let others review his security procedures, he can build the most secure exchange out there.  Large withdrawals may not be instant, who cares, at least they are safe.  If I deposit 1000 BTC with him, I want to trade it, not withdraw it back out immediately.


Title: Re: bitfloor needs your help!
Post by: DigitalHermit on September 04, 2012, 07:31:16 PM
Disbursing funds to some customers and not others would be a criminal act under those.

I believe a court order (injunction) should be filed to help ensure the exchange operator proceeds as prescribed by law.

Bitcoins were stolen, not cash. That cash is not Bitfloors to distribute to other customers. It's mine.

You assume that Bitfloor is under the same regulations as a brokerage requiring segregation of customer funds. I don't believe that is the case here, and even if it was, that is of little protection as we have seen recently with supposedly segregated funds in the MF Global and PFGBest collapses.

In this case I suppose it will come down to whether the Bankruptcy Judge finds that the Bitcoins stolen at the time were of value too (and must be replaced at their market value in USD) or not.


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 07:32:42 PM
It's very human at least.

I give shtylman props for being upfront about the theft rather than dither about it as some places have.


Title: Re: bitfloor needs your help!
Post by: Vladimir on September 04, 2012, 07:33:57 PM
Few questions:

Where your servers VPS?

Who hosted your servers?


 

from whois


Name Servers:
   ns1.linode.com
   ns2.linode.com
   ns3.linode.com
   ns4.linode.com


unbelievable!  I suppose 10$/month is something that kills common sense outright.



Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 07:36:37 PM
There is no single solution which meets the needs of every single service provider.  That being said having a hotwallet with 100% of the funds is simply inexcusable.   More than anything else it is sad.   Bitfloor was growing rapidly and was a great source of liquidity outside of MtGox (which is important IMHO).  It is destroyed now and honestly shtylman is better than that.

Agreed.  If Roman really learns as much as possible from this, let others review his security procedures, he can build the most secure exchange out there.  Large withdrawals may not be instant, who cares, at least they are safe.  If I deposit 1000 BTC with him, I want to trade it, not withdraw it back out immediately.
That +1000.  I t baffles me why larger sites have not implemented that yet.  Hell they could even make it a user option.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 07:37:12 PM

Like taking that 5% fee and paying someone who knows something about security to have a look at your stuff and point out obvious weaknesses like "unencrypted copy of the wallet keys" lying around on "supposedly non-public-facing" servers with open connections to public facing servers.

Or maybe one should be responsible for one's own money and btc and not leave them sitting on other peoples' servers for extended periods? Would you leave your wallet and house keys next to someone on the subway to watch for you? You gave him five bucks. He said he'll do his best.
Obviously you don't trade alot.  If you want to take advantage of the swings then you must hold a balance on the exchanges.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:37:33 PM
I give shtylman props for being upfront about the theft rather than dither about it as some places have.

He sent out an e-mail less than 24 hours ago about API keys being compromised, and asserted that "No accounts were compromised financially nor was there any access to coins or any funds."    

 - http://bitcointalk.org/index.php?topic=105079.msg1159003#msg1159003


That could have been an initial attempt to communicate based on a misunderstanding of the actual situation but there was no further communication until this announcement.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 07:38:25 PM
In this case I suppose it will come down to whether the Bankruptcy Judge finds that the Bitcoins stolen at the time were of value too (and must be replaced at their market value in USD) or not.

This.  I would also point out there isn't a single precedent that a judge could rely on so the judge would be essentially writing new law (something most judges don't like doing).  It is likely that a judge would look for regulation of Bitcoin (and exchanges) before accepting they have value as deposits under US Bankruptcy law.

Why?  Well otherwise the potential for abuse is huge.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 07:40:38 PM
That +1000.  I t baffles me why larger sites have not implemented that yet.  Hell they could even make it a user option.

MtGox does this (I hate to encourage more centralization of trading activity but it is the reality).  IIRC something like 80%+ of coins on deposit are in offline cold storage.   Sadly I was impressed by shtylman's other security measures and I assumed he used a cold wallet for at least a portion of the funds.   Expensive mistake on my part.


Title: Re: bitfloor needs your help!
Post by: Vladimir on September 04, 2012, 07:40:45 PM
Replace word "bitcoins" by "potatoes" and any judge will figure out on the spot what to do.



Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 07:42:21 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.


Title: Re: bitfloor needs your help!
Post by: Severian on September 04, 2012, 07:42:54 PM
Obviously you don't trade alot.  If you want to take advantage of the swings then you must hold a balance on the exchanges.

No, I don't. I'm buy and hold. Bitfloor isn't so much an exchange as a bitcoin "store", which is a much needed service.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 07:43:10 PM
Replace word "bitcoins" by "potatoes" and any judge will figure out on the spot what to do.

Potatoes aren't a digital construct thinly traded only on unregulated exchanges which hasn't yet been defined by FinCEN or any other regulatory body.  I do agree that Bitcoin will need to be regulated eventually.  It simply can't co-exist with fiat currencies under existing laws without regulation and definition.

Still I think this is a case of people wanting to have their cake and eat it to.  Either Bitcoin is outside of regulation and statutes or it isn't.  It can't be "kinda" under the law.  If it is regulated that means tight AML, trade reporting to IRS, regulatory requirements for handling Bitcoins, licensing (VA requires a $500K bond to be a money transmitter for example), etc.

It can't be under the law when you want something and then outside regulation all the other times.  It is all or nothing baby.

Personally like it or not, I think on a long enough time line we will be in the "all" category.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:43:33 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

Who will cooperate in filing an injunction?

shtylman, where physically are you for service of process?


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 07:43:36 PM
New withdrawals are currently on hold while I work through the future of the exchange.

That is unacceptable.  Regardless of the future of the exchange you have an obligation to disburse funds to the ACH account on record.  You previously handled requests by email.  USD funds by depositors are the property of the depositor and not an investment.  You have no legal standing to hold those funds pending "anything".
I agree with TangibleCryptography.

In your own words:
I know exactly how much each user currently has in their account for both USD and BTC. No records were lost in this attack.

Unless you have gotten legal advice to the contrary (if you have please let us know), I would advise processing ACH withdrawals on a as needed basis.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:47:12 PM
Unless you have gotten legal advice to the contrary (if you have please let us know), I would advise processing ACH withdrawals on a as needed basis.

If BitFloor is insolvent, unable to meet all withdrawal request of all customers, then disbursing even one penny is a criminal act.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 07:49:00 PM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 04, 2012, 07:49:51 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
So basically, BTC withdrawals will be delayed until you have the funds to pay for them?  Or both BTC and USD withdrawals (after you allow whoever wants to withdraw via ACH to do so)?  What if I trade for USD (once you re-enable trading), then request an ACH withdrawal?


Title: Re: bitfloor needs your help!
Post by: Vladimir on September 04, 2012, 07:49:55 PM
Replace word "bitcoins" by "potatoes" and any judge will figure out on the spot what to do.

Potatoes aren't a digital construct thinly traded only on unregulated exchanges.  I do agree that Bitcoin will need to be regulated eventually.  It simply can't co-exist with fiat currencies without definition.  However that day isn't today.

Of course. However, potatoes have value, they can be stolen too. Imagine a commodity exchange where you can deposit bags of potatoes that you and other customers have "farmed". Those potatoes can be sent to the exchange as well as fiat money (legal tender btw). Someone have stolen all the potatoes, exchange goes BK... Effectively a judge has only two choices:

1. Distribute all fiat back to depositors and leave potato sellers to hold the bag (an empty potato bag no less).
2. Value all the lost potato deposits in fiat, distribute whatever fiat left proportionally.

I bet it will be 2.



Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:52:48 PM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023

Roman recently had traveled or moved possibly out of the country (London ?). 


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 07:54:02 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
So basically, BTC withdrawals will be delayed until you have the funds to pay for them?  Or both BTC and USD withdrawals (after you allow whoever wants to withdraw via ACH to do so)?  What if I trade for USD (once you re-enable trading), then request an ACH withdrawal?

The BTC are gone but I have records of how much each person had at the time of the theft. Once trading resumes you will be free to deposit new BTC and trade those for USD.


Title: Re: bitfloor needs your help!
Post by: vampire on September 04, 2012, 07:54:51 PM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023

Roman recently had traveled or moved possibly out of the country (London ?). 

The address is USPS PO Box. Roman went for the conference to london?


Title: Re: bitfloor needs your help!
Post by: runeks on September 04, 2012, 07:56:25 PM
Dammit! I'm sorry to hear this shtylman. I really had high hopes for bitfloor as well. The user interface is by far the best of any exchange I've seen.

I really hope you will release more information about how the attack was carried out. At least tell us what you know. Exchange security will never improve if we don't know how these hackers get in. Based on the number of exchanges that have been compromised, I assume that the attacks aren't terribly advanced. I mean, not via the sort of vulnerabilities that go for $100k on the black market and take months to discover. It would really help to know if it's SQL injection or an Apache/nginx vulnerability or something else.


Title: Re: bitfloor needs your help!
Post by: Otoh on September 04, 2012, 07:57:17 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

wow, sounds like he's found an angel backer, maybe it's the hacker, at least that would help sort out basic security issues as he wouldn't want anyone else running off with his new golden goose


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 07:57:38 PM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023

Roman recently had traveled or moved possibly out of the country (London ?). 

The address is USPS PO Box. Roman went for the conference to london?

He's been there since July at least:

 - http://bitcointalk.org/index.php?topic=94975.0

Related thread:

 - http://bitcointalk.org/index.php?topic=93655.0


Title: Re: bitfloor needs your help!
Post by: EnergyVampire on September 04, 2012, 07:57:49 PM
There is no single solution which meets the needs of every single service provider.  That being said having a hotwallet with 100% of the funds is simply inexcusable.   More than anything else it is sad.   Bitfloor was growing rapidly and was a great source of liquidity outside of MtGox (which is important IMHO).  It is destroyed now and honestly shtylman is better than that.

Agreed.  If Roman really learns as much as possible from this, let others review his security procedures, he can build the most secure exchange out there.  Large withdrawals may not be instant, who cares, at least they are safe.  If I deposit 1000 BTC with him, I want to trade it, not withdraw it back out immediately.

+1 I agree with BitPay(Tony?)

On another note, it might be possible to raise funds with a bond or equity (preferred shares, maybe?) issue. Not sure about the legality, regardless BitFloor will absorb the lost coins but at least your customers will be satisfied imo.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 07:58:15 PM
Dammit! I'm sorry to hear this shtylman. I really had high hopes for bitfloor as well. The user interface is by far the best of any exchange I've seen.

I really hope you will release more information about how the attack was carried out. At least tell us what you know. Exchange security will never improve if we don't know how these hackers get in. Based on the number of exchanges that have been compromised, I assume that the attacks aren't terribly advanced. I mean, not via the sort of vulnerabilities that go for $100k on the black market and take months to discover. It would really help to know if it's SQL injection or an Apache/nginx vulnerability or something else.

This I would be willing to donate towards a fund for the victims if detailed information on the attack as well as post-attack analysis and mitigating steps were provided.   I hope I am not the only one.  It could improve the security of other exchanges and service providers.


Title: Re: bitfloor needs your help!
Post by: gllen on September 04, 2012, 07:58:22 PM
Man, that's really too bad.

I've been nothing but impressed by bitfloor; from the video interview, to the github code, to the API and testnet, BF seems like one of the best implemented exchanges out there.

63k BTC (30 day volume) = 3.15k fees (converted to BTC)?

Maybe a dumb idea, but you could offer trade-able bonds to the current BTC balance holders, with a 12-24 month term, and a generous (but achievable) rate.


Edit: 0.3% fees = 189 BTC gross. My math above is way off  :-\


Title: Re: bitfloor needs your help!
Post by: ErnestoJuarell on September 04, 2012, 08:00:41 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
So basically, BTC withdrawals will be delayed until you have the funds to pay for them?  Or both BTC and USD withdrawals (after you allow whoever wants to withdraw via ACH to do so)?  What if I trade for USD (once you re-enable trading), then request an ACH withdrawal?

The BTC are gone but I have records of how much each person had at the time of the theft. Once trading resumes you will be free to deposit new BTC and trade those for USD.
Was the box holding the records compromised? How can you be sure the hacker didn't mess with the figures. Do you have offline backups to compare to to look for something fishy?


Title: Re: bitfloor needs your help!
Post by: LoweryCBS on September 04, 2012, 08:00:48 PM
I'd buy Bitfloor-issued bonds. Or even Bitfloor stock.

Man, that's really too bad.

I've been nothing but impressed by bitfloor; from the video interview, to the github code, to the API and testnet, BF seems like one of the best implemented exchanges out there.

63k BTC (30 day volume) = 3.15k fees (converted to BTC)?

Maybe a dumb idea, but you could offer trade-able bonds to the current BTC balance holders, with a 12-24 month term, and a generous (but achievable) rate.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 08:02:58 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

wow, sounds like he's found an angel backer, maybe it's the hacker, at least that would help sort out basic security issues as he wouldn't want anyone else running off with his new golden goose

What makes you think that.

"repaying BTC losses using the proceeds from fees".


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 08:07:31 PM
Replace word "bitcoins" by "potatoes" and any judge will figure out on the spot what to do.

Potatoes aren't a digital construct thinly traded only on unregulated exchanges.  I do agree that Bitcoin will need to be regulated eventually.  It simply can't co-exist with fiat currencies without definition.  However that day isn't today.

Of course. However, potatoes have value, they can be stolen too. Imagine a commodity exchange where you can deposit bags of potatoes that you and other customers have "farmed". Those potatoes can be sent to the exchange as well as fiat money (legal tender btw). Someone have stolen all the potatoes, exchange goes BK... Effectively a judge has only two choices:

1. Distribute all fiat back to depositors and leave potato sellers to hold the bag (an empty potato bag no less).
2. Value all the lost potato deposits in fiat, distribute whatever fiat left proportionally.

I bet it will be 2.
/me steals the idea and runs off to create Potatoe-ville for facebook.


Title: Re: bitfloor needs your help!
Post by: BitPay Business Solutions on September 04, 2012, 08:07:55 PM

+1 I agree with BitPay(Tony?)

On another note, it might be possible to raise funds with a bond or equity (preferred shares, maybe?) issue. Not sure about the legality, regardless BitFloor will absorb the lost coins but at least your customers will be satisfied imo.

Yes that's me.

Multiple options are being considered.  First and foremost, Roman needs a written security plan.  This is just processes and procedures, not passwords.

Beyond that, I have given Roman some ideas on how he can restart or rebuild Bitfloor stronger, but I will wait for him to review and circulate those ideas himself.  Taking outside investment capital is not out of the question.  He has the best technology of any exchange, and that is worth something to people looking to invest in this area.  He also needs to learn from this and have the best security of any exchange.



Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 08:10:53 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

Who will cooperate in filing an injunction?

Unless an injunction is filed, there is about a quarter million USD worth of customer funds from BTC balances that are going to disappear as Roman is out of the country and he has announced plans to process USD withdrawals.  i.e., those USDs are going to be leaving the BitFloor bank accounts very soon unless action is taken.

At least with an injunction, cents on the dollar (at the same level as USD depositors get) would be returned on those BTC balances.

Personally I don't have enough bitcoins with BitFloor to warrant me pursuing this myself.  

I would be surprised that nobody else cares though.


Title: Re: bitfloor needs your help!
Post by: Otoh on September 04, 2012, 08:14:13 PM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

wow, sounds like he's found an angel backer, maybe it's the hacker, at least that would help sort out basic security issues as he wouldn't want anyone else running off with his new golden goose

What makes you think that.

"repaying BTC losses using the proceeds from fees".

Well I hope he has found one or at least enough interest to expect one otherwise it would take forever to pay back from fees - I just don't think that would be realistic without someone buying in to the company


Title: Re: bitfloor needs your help!
Post by: BitPay Business Solutions on September 04, 2012, 08:14:51 PM
Personally didn't have enough bitcoins with BitFloor to warrant me pursuing this myself.  

I would be surprised that nobody else cares though.

Technically you are correct.  However I can verify that Roman is in regular contact with his largest depositors, and while I cannot speak for all of them, I do believe this will be resolved without a bankruptcy.  give the guy a chance to make some calls and look at his options to bring in capital.


Title: Re: bitfloor needs your help!
Post by: muyuu on September 04, 2012, 08:28:49 PM
Knowing that they had an unencrypted wallet somewhere with ALL the funds, and ran the whole thing on a Linode VPS despite all past happenings, I find it really hard to consider a potential investment in Bitfloor other than extremely high risk.

It's sad because shtylman sounds like a really nice lad and the interface is well done, but obviously he's punching above his weight with the exchange idea.

Maybe if he hired a team of security experts *cough*  ;) or maybe not...


Title: Re: bitfloor needs your help!
Post by: Joe200 on September 04, 2012, 08:30:01 PM
Thank you for allowing ACH withdrawals.

Could you please allow trading to resume? Then the people who really want to get out will be able to sell their bitcoins (for a fraction of their price outside of bitfloor). And people who are speculating that things will turn out will be able to buy up those bitcoins and potentially make money.

I think this will reduce the amount of customer discontent.


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 08:31:55 PM
Knowing that they had an unencrypted wallet somewhere with ALL the funds, and ran the whole thing on a Linode VPS despite all past happenings, I find it really hard to consider a potential investment in Bitfloor other than extremely high risk.

This translates to an AA- rating in Harnettopia, so buyer beware


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 08:33:48 PM
Thank you for allowing ACH withdrawals.

Could you please allow trading to resume? Then the people who really want to get out will be able to sell their bitcoins (for a fraction of their price outside of bitfloor). And people who are speculating that things will turn out will be able to buy up those bitcoins and potentially make money.

I think this will reduce the amount of customer discontent.

The problem with this is that there isn't enough coins to cover all (any?) withdrawal requests.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 04, 2012, 08:34:22 PM
Sorry to hear about that.
If security is verified by a trusted 3rd party I'd be interested in bonds should you choose to go that way.

+1


Title: Re: bitfloor needs your help!
Post by: Joe200 on September 04, 2012, 08:38:55 PM
Thank you for allowing ACH withdrawals.

Could you please allow trading to resume? Then the people who really want to get out will be able to sell their bitcoins (for a fraction of their price outside of bitfloor). And people who are speculating that things will turn out will be able to buy up those bitcoins and potentially make money.

I think this will reduce the amount of customer discontent.

The problem with this is that there isn't enough coins to cover all (any?) withdrawal requests.

People can withdraw USD.

Say, I had 100 BTC sitting on bitfloor before the hack. You had 100 USD. I give you the claim to my BTC, you give me your USD. I withdraw your USD (since that part was not compromised, right?). You have the claim to the 100 BTC. If, at some point in the future, some or all BTC will be paid out, you will get paid for that claim. If not, you lose. But you went in knowing that it was speculative. So we're both happy (or happier).


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 08:46:00 PM
Thank you for allowing ACH withdrawals.

Could you please allow trading to resume?

Right now, any USD withdrawals are subject to the funds being clawed back if BitFloor is insolvent.    So someone trading and then withdrawing bitcoins is better off (as bitcoin reversals are not reversible) than the party that withdrew USDs.

I hope for Roman's sake he either comes up with sufficient capital or if BitFloor is insolvent he gets legal advice before processing a single withdrawal.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 04, 2012, 08:52:02 PM
Please note that I have taken the website offline. I am consulting legal council about the current situation and will post once I have more details. I want to make sure the matter is handled appropriately given the financial situation the exchange is currently in.

The website was causing too much confusion in the current form and once I have more details I will post a very clear message for all users.


Title: Re: bitfloor needs your help!
Post by: eja on September 04, 2012, 08:54:49 PM
Crap, my entire bitcoin holdings down the drain (only 24BTC but still). And to think I was going to withdraw it all yesterday but procrastinated..


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 08:59:20 PM
Maybe if he hired a team of security experts *cough*  ;) or maybe not...
With what money? Bitfloor was netting 0.3% per transaction, and its monthly volume was like 60k BTC. So it was profiting 180 BTC per month. That's not enough to hire even one security expert, let alone a whole team.


Title: Re: bitfloor needs your help!
Post by: coga on September 04, 2012, 09:07:54 PM
Personally didn't have enough bitcoins with BitFloor to warrant me pursuing this myself.  

I would be surprised that nobody else cares though.

Technically you are correct.  However I can verify that Roman is in regular contact with his largest depositors, and while I cannot speak for all of them, I do believe this will be resolved without a bankruptcy.  give the guy a chance to make some calls and look at his options to bring in capital.

I am not sure if I could call myself his largest depositor, but I was trading on bitfloor regularly until the incident happened and I second opinion that he always acted in good faith so far (as far as I could tell), and he deserves a second chance


Title: Re: bitfloor needs your help!
Post by: muyuu on September 04, 2012, 09:08:19 PM
Maybe if he hired a team of security experts *cough*  ;) or maybe not...
With what money? Bitfloor was netting 0.3% per transaction, and its monthly volume was like 60k BTC. So it was profiting 180 BTC per month. That's not enough to hire even one security expert, let alone a whole team.

I know. Running an exchange with these financials is untenable. They should team up and go on IPO in order to get proper server infrastructure and staff, and ramp up to cover cost.

If they can't raise enough they shouldn't be running an exchange IMO. The same thing would happen. The standards for exchanges cannot be lowered this much, people expect their money not to go away and solvency to cover possible eventualities.


Title: Re: bitfloor needs your help!
Post by: Draino on September 04, 2012, 09:08:31 PM
Maybe if he hired a team of security experts *cough*  ;) or maybe not...
With what money? Bitfloor was netting 0.3% per transaction, and its monthly volume was like 60k BTC. So it was profiting 180 BTC per month. That's not enough to hire even one security expert, let alone a whole team.

pretty sure that was a dig on bitcoin consultancy

if not, it should be taken as one


Title: Re: bitfloor needs your help!
Post by: muyuu on September 04, 2012, 09:10:06 PM
pretty sure that was a dig on bitcoin consultancy

if not, it should be taken as one

That as well  ;D


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 09:12:38 PM
pretty sure that was a dig on bitcoin consultancy

if not, it should be taken as one
I don't know anything about "bitcoin consultancy," but I do work in the network security industry, and I will tell you that security experts make six figures (USD).


Title: Re: bitfloor needs your help!
Post by: xioustic on September 04, 2012, 09:49:03 PM
Please note that I have taken the website offline. I am consulting legal council about the current situation and will post once I have more details. I want to make sure the matter is handled appropriately given the financial situation the exchange is currently in.

The website was causing too much confusion in the current form and once I have more details I will post a very clear message for all users.
This is the best option for you. Given the size of the loss (assuming the courts system would hold up a value for the BTC lost if action was taken against you), you're looking at a huge risk if you handle things inappropriately and any one of your users files any sort of legal action against you. We appreciate the notice, but you need to cover your butt, especially if you're in the US. At current exchange rate, a loss of a quarter million U.S. dollars worth of a commodity is gigantic and definitely warrants legal council on how to proceed.

You seem like a nice guy and I really appreciated the service when it was running before all this. Assuming you're not the perpetrator (something that a few members might suggest in speculation), I wish you the best and hope things can be resolved. Your personally liability for this may be incredible compared to any sort of profit you may have realized for providing the service. Looking out for your personal future (not even the future of BitFloor), I would seek immediate legal council.

Sadly, if you seek GOOD legal council... Their first piece of advice would probably to take the site down with a notice and keep as quiet as possible until everything is figured out.

Best of luck.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 09:56:10 PM
Thank you for allowing ACH withdrawals.

Right now, any USD withdrawals are subject to the funds being clawed back if BitFloor is insolvent.    So someone trading and then withdrawing bitcoins is better off (as bitcoin reversals are not reversible) than the party that withdrew USDs.

I hope for Roman's sake he either comes up with sufficient capital or if BitFloor is insolvent he gets legal advice before processing a single withdrawal.

I'm sorry your bitcoins were stolen, but please stop trying to steal my Bitfloor USD to make up for it.  

Segregated accounts are segregated.  Your endorsement of MFGlobal style account pooling is unethical and shameful!

To Hell with your communist bankster logic and the (rare) corrupt courts that recognize it.  500 years of organic common law disagree.

Those are my USD, not yours, so please STFU about clawing back what was never your property to begin with.

My USD did not magically become your property just because your bitcoins were stolen.  That's freaking asinine, you should know better!

Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 10:02:37 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.


Title: Re: bitfloor needs your help!
Post by: thebaron on September 04, 2012, 10:03:24 PM
Doesn't anyone learn a goddamned thing from previous hacks? Christ.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 10:03:27 PM
Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.
Unfortunately for those of us who had significant USD balances at Bitfloor, what others are saying is correct: Roman must now cease all activity — even activity that many of us would consider "the right thing to do" — and seek legal counsel. Assuming everything is handled sanely in the court system (a big assumption), we might expect a refund of our USD balances in a few months — either all or in part, depending on whether the balances were legally segregated and allocated, which I doubt they were.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:15:22 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution



Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:20:35 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution

Actually, that clause is exactly the problem.  Until due process of law, it is not legally clear whether any of the USD controlled by bitfloor is the property of those who had BTC on deposit, the property of bitfloor, or solely the property of those who have USD on deposit with bitfloor.  Bitfloor therefore cannot legally give USD to anyone until due process determines exactly whose property each and every $0.01 is.


Title: Re: bitfloor needs your help!
Post by: ElectricMucus on September 04, 2012, 10:22:29 PM
Oh wow I nearly missed that one.

Nice "hack"


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:23:04 PM
Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.
Unfortunately for those of us who had significant USD balances at Bitfloor, what others are saying is correct: Roman must now cease all activity — even activity that many of us would consider "the right thing to do" — and seek legal counsel. Assuming everything is handled sanely in the court system (a big assumption), we might expect a refund of our USD balances in a few months — either all or in part, depending on whether the balances were legally segregated and allocated, which I doubt they were.

Wrong.  Presumption of ownership goes to the segregated account holders.

BitFloor will be sued successfully for holding USD without their OWNER'S consent, unless there is a clause in the TOS stating that any USD deposited into BitFloor automatically becomes part of a single pool of assets with shared liability.

If the communist scumbag Corzine supporters wish to claw back USD that never belonged to them, they are welcome to try AFTER the rightful owners get paid, not before.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:24:27 PM
Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.
Unfortunately for those of us who had significant USD balances at Bitfloor, what others are saying is correct: Roman must now cease all activity — even activity that many of us would consider "the right thing to do" — and seek legal counsel. Assuming everything is handled sanely in the court system (a big assumption), we might expect a refund of our USD balances in a few months — either all or in part, depending on whether the balances were legally segregated and allocated, which I doubt they were.

Wrong.  Presumption of ownership goes to the segregated account holders.

BitFloor will be sued successfully for holding USD without their OWNER'S consent, unless there is a clause in the TOS stating that any USD deposited into BitFloor automatically becomes part of a single pool of assets with shared liability.

If the communist scumbag Corzine supporters wish to claw back USD that never belonged to them, they are welcome to try AFTER the rightful owners get paid, not before.
I understand your frustration, but your anger will not help anything here.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:26:32 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution

Actually, that clause is exactly the problem.  Until due process of law, it is not legally clear whether any of the USD controlled by bitfloor is the property of those who had BTC on deposit, the property of bitfloor, or solely the property of those who have USD on deposit with bitfloor.  Bitfloor therefore cannot legally give USD to anyone until due process determines exactly whose property each and every $0.01 is.

That would depend on BitFloor's TOS.  I admit to never reading it, but who would be dumb enough to use an exchange that enforces communist bankster Corzine-style pooled accounts and shared liability for losses?  (Me, maybe...  :D) 


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:26:44 PM
Wrong.  Presumption of ownership goes to the segregated account holders. . .unless there is a clause in the TOS stating that . . .

I have not engaged in any business with BitFloor, so I'm not aware of their TOS.  Do you have a copy of that TOS?  Can you post a copy of it here?


Title: Re: bitfloor needs your help!
Post by: lologarithm on September 04, 2012, 10:27:19 PM
So last week I deposited about $1000 in bitfloor and hadn't even yet made a single trade with it. While it was extra savings money and I can survive without it, I am quite upset about not being able to pull my money out....


Title: Re: bitfloor needs your help!
Post by: repentance on September 04, 2012, 10:27:37 PM


Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution



US insolvency requirements are "due process of law".  It's up to those who don't believe that US insolvency law should be applied in this case to petition the court with on point arguments and case law supporting that assertion - the cost of defending against any such actions will come out of the bankrupt estate.  Unless USD holders can establish that they're secured or preferential creditors as defined by US insolvency law, there are no legal grounds on which they can be paid in full in preference to other unsecured creditors without the agreement of those other creditors.



Title: Re: bitfloor needs your help!
Post by: xioustic on September 04, 2012, 10:29:18 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution


These are all things for the legal council (and if it goes to U.S. court, the judge) to decide in order to figure out what actions are appropriate. That's where the "due process of law" comes in. You're entitled to your process, BitFloor is entitled to theirs. BitFloor seeking legal council is where he ensures that he is acting in a way most within the law. Your process would be serving BitFloor and/or suing them.

Things are not that simple that withdrawals can happen just for the solvent parts of the business held; welcome to the world of BitCoin, where everything is without absolute legal precedent (yet). If a legal precedent can be set that the BTC has value, it would be illegal for them to use any portion of the assets (including remaining balances held for what wasn't hacked) to pay out to anybody until the appropriate process on reimbursing has been determined in court.

This WILL not be a quick process. The only quick process would be if the coins were returned by the hacker, or if someone invested BTC in BitFloor in exchange for ownership (or a portion of). I'd imagine this case (albeit not a likely one) is the one that BitFloor is hoping for the most.

Best case for USD holders (and worst case for BTC holders) is that his legal council (or the court system) determines that BTC will be considered "worthless" and that USD should be distributed to account holders as it's the only part of BitFloor that needs to be legally held solvent. However, I can just about guarantee that if this happens, anyone holding a large amount of BTC will file an injunction and appeal, which will almost certainly prevent payout of USD funds from happening quickly.

Hang on folks, this is likely to be an interesting one, especially since it's occurring in the oh-so-litigious US.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:29:59 PM
Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.
Unfortunately for those of us who had significant USD balances at Bitfloor, what others are saying is correct: Roman must now cease all activity — even activity that many of us would consider "the right thing to do" — and seek legal counsel. Assuming everything is handled sanely in the court system (a big assumption), we might expect a refund of our USD balances in a few months — either all or in part, depending on whether the balances were legally segregated and allocated, which I doubt they were.

Wrong.  Presumption of ownership goes to the segregated account holders.

BitFloor will be sued successfully for holding USD without their OWNER'S consent, unless there is a clause in the TOS stating that any USD deposited into BitFloor automatically becomes part of a single pool of assets with shared liability.

If the communist scumbag Corzine supporters wish to claw back USD that never belonged to them, they are welcome to try AFTER the rightful owners get paid, not before.
I understand your frustration, but your anger will not help anything here.

Accusing me of "anger" is not the best way to rebut anything I've claimed.  The ALLCAPS are for emphasis, not rageposting.

Note that not a single exclamation point was used in my post.  I'll use bold next time, so as not to further confuse you.   8)


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:30:11 PM
. . .That would depend on BitFloor's TOS. . .
Exactly, and as such, it would be legally dubious for BitFloor to allow any withdrawl of any funds USD or otherwise, until due process of law has determined exactly what the TOS requires of them.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:31:13 PM
So last week I deposited about $1000 in bitfloor and hadn't even yet made a single trade with it. While it was extra savings money and I can survive without it, I am quite upset about not being able to pull my money out....
BF was my primary source of USD=>BTC so I feel your pain.  It very well could have been me so I feel your pain... esp with the price I would not have bought now so I narrowly missed the trap on this  one.

Sorry :(


Title: Re: bitfloor needs your help!
Post by: Ricochet on September 04, 2012, 10:31:21 PM
This is unrelated to anything, but holy crap, Roman?  I simultaneously can and cannot believe that it's you behind Bitfloor.  I haven't paid much attention to Bitcoin in the past few months, so this is really a shock to me.  Good to see you did something incredibly useful with your software skills after Robocup, and I wish the best in continuing the operation of the site.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 04, 2012, 10:32:10 PM
Please quantify the amount of BTC lost as well as the total BTC owed.
What % of BTC were lost?

From the tx it looks like 30K BTC in outputs (although one involved two large outputs so it is unclear what is going on there).

This was almost all of the BTC.

Was there a loss of any USD funds?

No. All USD bank accounts are secure. And all records for the current status of the exchange (accounts, trades, etc) are all also secure.

I had BTC BID order in place. Will all orders be canceled automatically or will business be as usual once you get up and going again?

I am revealed that USD is SAFE. My BID order will be the largest to date with Bitfloor.

I am not panicking. I am sure you have everything under control.

I can't wait to start trading with Bitfloor again!

If there is anything I can do let me know. Credentials are below in my SIG.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:32:26 PM
Accusing me of "anger" is not the best way to rebut anything I've claimed.  The ALLCAPS are for emphasis, not rageposting.

Note that not a single exclamation point was used in my post.  I'll use bold next time, so as not to further confuse you.   8)
My apologies then, I misinterpreted your intentions.


Title: Re: bitfloor needs your help!
Post by: greyhawk on September 04, 2012, 10:33:50 PM
@unclemantis... You should probably read the rest of the thread


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:34:39 PM
So last week I deposited about $1000 in bitfloor and hadn't even yet made a single trade with it. While it was extra savings money and I can survive without it, I am quite upset about not being able to pull my money out....

Didn't you know that your $1000 instantly became part of the BitFloor collective the moment you deposited it?

Oh wait, that's not a reasonable interpretation of US law at all.  Sorry, the communists here are starting to confuse me.   ::)

http://i.qkme.me/3ojj43.jpg



Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:36:52 PM


Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_tSates_Constitution



US insolvency requirements are "due process of law".  It's up to those who don't believe that US insolvency law should be applied in this case to petition the court with on point arguments and case law supporting that assertion - the cost of defending against any such actions will come out of the bankrupt estate.  Unless USD holders can establish that they're secured or preferential creditors as defined by US insolvency law, there are no legal grounds on which they can be paid in full in preference to other unsecured creditors without the agreement of those other creditors.


Please show me where BitFloor has filed for bankruptcy, and then you might have a point.  Otherwise your post is non sequitur.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:39:52 PM
. . .Please show me where BitFloor has filed for bankruptcy, and then you might have a point.  Otherwise your post is non sequitur.
I'm sure that is one of several options that are being considered and discussed with Legal Counsel.


Title: Re: bitfloor needs your help!
Post by: repentance on September 04, 2012, 10:41:11 PM


Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_tSates_Constitution



US insolvency requirements are "due process of law".  It's up to those who don't believe that US insolvency law should be applied in this case to petition the court with on point arguments and case law supporting that assertion - the cost of defending against any such actions will come out of the bankrupt estate.  Unless USD holders can establish that they're secured or preferential creditors as defined by US insolvency law, there are no legal grounds on which they can be paid in full in preference to other unsecured creditors without the agreement of those other creditors.


Please show me where BitFloor has filed for bankruptcy, and then you might have a point.  Otherwise your post is non sequitur.

The laws apply from the moment the insolvency occurs (or can be anticipated) whether or not bankruptcy has been filed - that's why payments made prior to the filing of bankruptcy can be clawed back and why making preferential payments within a class of creditors is an offence in and of itself.

The possibility of trading out in some way exists here and Bitfloor is legally obliged to consider all options which would maximise the return to its creditors (including selling the business in part or in whole), but it cannot legally give preference to any unsecured creditors while it's insolvent (which it is at this point in time).


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:41:32 PM
. . .I am quite upset about not being able to pull my money out....

Didn't you know that your $1000 instantly became part of the BitFloor collective the moment you deposited it?

Oh wait, that's not a reasonable interpretation of US law at all. . .
But it may be a reasonable interpretation of the BitFloor TOS.  This has not yet been established.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 10:41:36 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution

The fifth amendment has no bearing on this issue.

If your sole qualification for making statements about US law is the fact that you have an opinion about US law, you might want to STFU before you make a fool of yourself to a greater extent.


Title: Re: bitfloor needs your help!
Post by: IveBeenBit on September 04, 2012, 10:44:30 PM
Roman has already said he's going to talk to a real lawyer. So nothing that any of you Internet lawyers say will have any impact on his actions. The only thing to do now is sit back and wait for an update once Roman's lawyer advises him on what course of action he should take.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 10:44:39 PM
Not sure where people get the idea that bitfloor "can't" repay USD account holders.

http://en.wikipedia.org/wiki/Fraudulent_conveyance

Quote
A transfer will be fraudulent if made with actual intent to hinder, delay or defraud any creditor. Thus, if a transfer is made with the specific intent to avoid satisfying a specific liability, then actual intent is present. However, when a debtor prefers to pay one creditor instead of another that is not a fraudulent transfer.[1]

Given that both Bitcoin and USD creditors "could" sue bitfloor and considering the relatively likelihood of each lawsuit and the relative likelihood of each being successful, the prudent thing for bitfloor to do would be to repay those creditors who have a high probability of success to preempt the lawsuit and seek plans for long term restitution (if viable) for those who's only recourse would be a totally unproven lawsuit of dubious merit.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:44:45 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution


These are all things for the legal council (and if it goes to U.S. court, the judge) to decide in order to figure out what actions are appropriate. That's where the "due process of law" comes in. You're entitled to your process, BitFloor is entitled to theirs. BitFloor seeking legal council is where he ensures that he is acting in a way most within the law. Your process would be serving BitFloor and/or suing them.

Things are not that simple that withdrawals can happen just for the solvent parts of the business held; welcome to the world of BitCoin, where everything is without absolute legal precedent (yet). If a legal precedent can be set that the BTC has value, it would be illegal for them to use any portion of the assets (including remaining balances held for what wasn't hacked) to pay out to anybody until the appropriate process on reimbursing has been determined in court.

This WILL not be a quick process. The only quick process would be if the coins were returned by the hacker, or if someone invested BTC in BitFloor in exchange for ownership (or a portion of). I'd imagine this case (albeit not a likely one) is the one that BitFloor is hoping for the most.

Best case for USD holders (and worst case for BTC holders) is that his legal council (or the court system) determines that BTC will be considered "worthless" and that USD should be distributed to account holders as it's the only part of BitFloor that needs to be legally held solvent. However, I can just about guarantee that if this happens, anyone holding a large amount of BTC will file an injunction and appeal, which will almost certainly prevent payout of USD funds from happening quickly.

Hang on folks, this is likely to be an interesting one, especially since it's occurring in the oh-so-litigious US.

You are assuming facts not in evidence:

1)  Bitcoins have not been legally recognized as anything other than magical internetnerd tokens.

2)  Bitcoin is an experiment, there is no implied warranty or service-level agreement.

3)  BitFloor has not formally declared bankruptcy, which is the only way they can legally hold USD without the owners' consent.

4)  While bitcoin is uncharted legal territory, regulations for transactions regarding USD are well known and quite settled.  You can't detain or steal legally-recognized USD "because bitcoin."


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:47:40 PM
Roman has already said he's going to talk to a real lawyer. So nothing that any of you Internet lawyers say will have any impact on his actions. The only thing to do now is sit back and wait for an update once Roman's lawyer advises him on what course of action he should take.
What !??!?!?   What am I supposed to do with my Internet Law Degree?   I got it from this guy named pirate... he said it was legit....


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:47:45 PM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution


Full text:
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

Based on this it appears that it actually says:
"No person shall . . . in any criminal case . . . be a witness against himself, nor be deprived of life, liberty, or property, without due process of law."

Note the location of the semi-colons.

As such this amendment refers only to a limit on the government's ability to deprive you of your property without due process, and nothing to do with BitFloor's ability to deprive you of what you believe to be your property until they can determine their legal responsibilities.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 10:50:58 PM
Yeah IceBreaker the US constitution has absolutely nothing with this situation.  It actually weakens your position because it is so off-the-wall offtopic.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 04, 2012, 10:51:05 PM
Not sure where people get the idea that bitfloor "can't" repay USD account holders.

http://en.wikipedia.org/wiki/Fraudulent_conveyance

Quote
A transfer will be fraudulent if made with actual intent to hinder, delay or defraud any creditor. Thus, if a transfer is made with the specific intent to avoid satisfying a specific liability, then actual intent is present. However, when a debtor prefers to pay one creditor instead of another that is not a fraudulent transfer.[1]

Given that both Bitcoin and USD creditors "could" sue bitfloor and considering the relatively likelihood of each lawsuit and the relative likelihood of being successful the prudent thing for bitfloor to do would be to repay those creditors who essentially have an open and shut case when it comes to a lawsuit. 


^^This^^

Well put, thank you D&T for clearly making the point I've been struggling to establish.

In case it's not clear to the dimwit collectivists, the "creditors who essentially have an open and shut case when it comes to a lawsuit" are we who have USD held by BitFloor, not the magical internetnerd token owners.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:51:58 PM
Keep in mind that the law is not only the constitution.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 10:53:24 PM
I would also point out that our company is owed both USD & BTC but I am willing to give shtylman time to resolve the situation.  If it came to a lawsuit well we are simply writing the BTC off as trading losses and going forward with a USD lawsuit.  It simply isn't worth the filing costs for a claim with a snowball in hell's chance of even being heard.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:56:39 PM
It really would be interesting to have access to the TOS.  Without that, anything said by iCEBREAKER and DeathAndTaxes is nothing more than what they hope/want to have happen.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 10:57:13 PM
Not sure where people get the idea that bitfloor "can't" repay USD account holders.

Let's say I make sandwiches and I buy on credit some cooking equipment and I bought on credit some bread, meat, vegetables, etc.

And then my safe gets robbed overnight and I am insolvent.

I am not allowed to then let the cooking equipment vendor come and reclaim his equipment while the unpaid debt to the grocery supplier remains unpaid because I had previously sold the sandwiches and the food is now gone.

When you deposited USDs with BitFloor, you are in the same pool as the person that deposited BTCs.   They are all the same category -- customer assets.

Those with BTCs can get an injunction to freeze the USD funds but apparently nobody cares


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 04, 2012, 10:58:04 PM
It simply isn't worth the filing costs for a claim with a snowball in hell's chance of even being heard.
This.

And my guess is that you and TC would be two of the bigger holders.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 10:59:25 PM
. . .Those with BTCs can get an injunction to freeze the USD funds but apparently nobody cares
Why are you so sure that this isn't already happening?


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 11:01:34 PM
Well no.  The last sentence is correct but the rest isn't.

IF under an injunction bitfloor would be prohibited by law to make further repayment of any of its creditors.  However no injunction has been filed and certainly none is already enjoining bitfloor from resolving business debts in the manner it sees fit.  If Bitfloor is enjoined from making payments I am sure he will let creditors know via this site or forum.

I would question the probability of a BTC injunction being successful but I do concede that if a judge enjoined bitfloor from paying any of its creditors pending bankruptcy protection then you would be correct.

Quote
Tthose (sic) with BTCs can get an injunction to freeze the USD funds but apparently nobody cares
Well technically those with BTC (myself included) could SEEK an injunction.  It isn't that I don't care I just feel it has a 0.0% chance of being successful.  A sought but unsuccessful injunction would not provide any relief.

Injunctions are only granted where "no relief under the law" is possible.  Even if the claim otherwise had merit (which it probably doesn't) it would not be possible to show that their is no other "relief under the law".

For example if someone is going to tear down a historical building getting an injunction is viable because dollars can't compensate for the loss of the historical building if later the plaintiffs win in court.  The burden for injunctions are high as due to their time sensitive nature, they preempt the other business of the court.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 11:01:54 PM
. . .Those with BTCs can get an injunction to freeze the USD funds but apparently nobody cares
Why are you so sure that this isn't already happening?

Because there were only crickets after this:

Who will cooperate in filing an injunction?

I do hope that is happening.


Title: Re: bitfloor needs your help!
Post by: thebaron on September 04, 2012, 11:04:20 PM
I wonder how much profit has been gained by keeping your BTC in an online wallet for day trading vs. the amount stolen to hacks for keeping them on insecure online systems.


Title: Re: bitfloor needs your help!
Post by: repentance on September 04, 2012, 11:05:54 PM

Tthose with BTCs can get an injunction to freeze the USD funds but apparently nobody cares


Bitcoinica losses would have been substantially reduced had users sought injunctive relief.



Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:07:42 PM
Full text:
[...]
As such this amendment refers only to a limit on the government's ability to deprive you of your property without due process, and nothing to do with BitFloor's ability to deprive you of what you believe to be your property until they can determine their legal responsibilities.

It's even better than that - the 5th amendment, itself, only applies to the US federal government - it can be applied to state governments through the privileges & immunities clause of the 14th amendment, which itself has some similar due process language that might be of interest to our legal scholars.

Of course, they're still going to have to make the leap from the constitution's limits on the behavior of governments to controlling the behavior of individuals, which they will likely find impossible; though with just the right mix of capital letters and accusations of Communism it might be possible. If that's not strong enough medicine, season liberally (ha!) with Halliburton, Blackwater, Vince Foster, Oliver North, Obama's birth certificate, Jack Ruby, the Mafia, Paula Jones, and cocaine in south-central LA to taste.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 11:08:04 PM
. . .  If Bitfloor is enjoined from making payments I am sure he will let creditors know via this site or forum. . .
I suspect that if BitFloor's legal counsel advised them against further communications via this forum, that they would not let their creditors know via this site or forum.  As a matter of fact, I suspect that we won't see much further communication from BitFloor via this forum at this time unless they find a way to come back online and cover all losses.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 04, 2012, 11:11:41 PM
I suspect that if BitFloor's legal counsel advised them against further communications via this forum, that they would not let their creditors know via this site or forum.  As a matter of fact, I suspect that we won't see much further communication from BitFloor via this forum at this time unless they find a way to come back online and cover all losses.

Well if Bitfloor is enjoined by a court order they would be required to inform their creditors of that material fact.   They don't have to use this forum or their website but that would be the most effective means of communication. They don't need to explain the injunction or provide any other information but they do need to let their creditors know.   The court order would also become public record.

Of course all that is academic because no injunction will be granted.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 11:12:46 PM
I suspect that if BitFloor's legal counsel advised them against further communications via this forum, that they would not let their creditors know via this site or forum.  As a matter of fact, I suspect that we won't see much further communication from BitFloor via this forum at this time unless they find a way to come back online and cover all losses.
So is it now on me to remember to check Bitfloor.com or this thread a month, two months, three months from now to see if there's been unveiled a way for me to reclaim the part of my property that wasn't stolen?


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 11:15:46 PM
Well if Bitfloor is enjoined by a court order they would be required to inform their creditors of that material fact.  It would be in their best interest to do so (prevent filing of additional suits for a matter already heard by the court).  The court order would also become public record.
This is true, but I doubt that bitcointalk.org will be the method that legal counsel uses to disseminate this information. 

Of course all that is academic because no injunction will be granted.
This may be true.  Only time will tell.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:16:56 PM
It's also possible for a creditor to file a petition in bankruptcy court to force an uncooperative/insolvent debtor into bankruptcy.

There are tons of interesting legal projects here, the real question is whether or not anyone's lost enough money to make it worth pursuing, and if they're inclined to possibly throw good money after bad.

My hunch is that people who are sophisticated enough to maneuver through the issues were also savvy enough not to leave a lot of value in the hands of someone who leaves an unencrypted wallet on a Linode VPS. And if they made that mistake, they probably will choose to treat it as a learning experience and move on (the funds were probably intended for speculation, so their loss is likely to be inconsequential) rather than fight for control of a rapidly diminishing pool of assets.

People who were foolish enough (if there are any left after previous exchange disasters and the Pirate swindle) to leave most/all of their funds in an online exchange probably don't have any resources left with which to fight about this.


Title: Re: bitfloor needs your help!
Post by: ElectricMucus on September 04, 2012, 11:18:30 PM
lulz

The Bitcoin Show - 056 - Roman Shtylman of Bitfloor.com  (http://www.youtube.com/watch?v=F7SsavHX6tc)


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:22:34 PM
I suspect that if BitFloor's legal counsel advised them against further communications via this forum, that they would not let their creditors know via this site or forum.  As a matter of fact, I suspect that we won't see much further communication from BitFloor via this forum at this time unless they find a way to come back online and cover all losses.
So is it now on me to remember to check Bitfloor.com or this thread a month, two months, three months from now to see if there's been unveiled a way for me to reclaim the part of my property that wasn't stolen?

If a bankruptcy is filed and you had $ or BTC at bitfloor, you should be included on the list of creditors, and you'll get periodic mailings about the progress of the matter.

If some other legal action is filed, there's a pretty good chance you'll be included as a party, which would mean you'll get copies of filings, unless you hire an attorney, who'd handle them for you.

But, generally, this is how the world works. If you entrust someone else with your stuff, and shit happens to them where they have trouble giving back all of the stuff they've promised to others, it's gonna be ugly and inconvenient. This is even how it works if someone comes to your house and takes all of your shit involuntarily.

So the trick is to not let it happen in the first place.

Ask the Bitcoinica depositors how that claim process is going.

At least here, there's some chance that this will be handled in an orderly fashion in a single jurisdiction, instead of the international clusterfuck that is Bitcoinica.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 11:22:56 PM
So is it now on me to remember to check Bitfloor.com or this thread a month, two months, three months from now to see if there's been unveiled a way for me to reclaim the part of my property that wasn't stolen?
Good question.  Here's two for you.  If it turns out that the only way for anyone to regain any of their property, Bitcoin or USD, is to file a petition with the court, will you bother to do so?  How many will?


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 11:25:58 PM
If a bankruptcy is filed and you had $ or BTC at bitfloor, you should be included on the list of creditors, and you'll get periodic mailings about the progress of the matter.
Now we are getting to the really interesting stuff.  If BitFloor does not have any information on how to contact you, how will you get periodic mailings?

If some other legal action is filed, there's a pretty good chance you'll be included as a party, which would mean you'll get copies of filings,
See my question above.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:29:09 PM
. . . savvy enough not to leave a lot of value in the hands of someone who leaves an unencrypted wallet on a Linode VPS.

I want to be clear that while that sounds harsh, and I do view this as a pretty significant screw-up (in that several hundred thousand dollars have been lost) I respect the way Roman has handled this so far in terms of (apparently) being open with the community, trying to fix things, and in seeking help when he figured out that he was in over his head. I don't see what he could have done better other than not let this happen in the first place, which is a lot easier to say than to do.

My personal guess is that Bitfloor is dead but Roman will go on to do other, better things, wiser from the experience.

And so will the people who just learned an expensive lesson about the difference between an insured deposit at a real financial institution and an entry in a database table on a Linode VPS.



Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 04, 2012, 11:29:26 PM
To my knowledge, no USD deposits receive interest correct?

If interest was being earned then those deposits would be a different pool of "customer property" than the USDs deposited for the purpose of trading (which is the same purpose that my BTCs were deposited for -- only for the purpose of trading).


Title: Re: bitfloor needs your help!
Post by: repentance on September 04, 2012, 11:30:13 PM
I suspect that if BitFloor's legal counsel advised them against further communications via this forum, that they would not let their creditors know via this site or forum.  As a matter of fact, I suspect that we won't see much further communication from BitFloor via this forum at this time unless they find a way to come back online and cover all losses.
So is it now on me to remember to check Bitfloor.com or this thread a month, two months, three months from now to see if there's been unveiled a way for me to reclaim the part of my property that wasn't stolen?

If they have your contact details, then they would be obligated to inform you of what's going on using the contact methods they have for you.  One of the biggest dangers of using services which do not require real life contact details - or choosing not to provide them - is that you may miss out on important information.

Quote
It's also possible for a creditor to file a petition in bankruptcy court to force an uncooperative/insolvent debtor into bankruptcy.

While this is true, there is usually a requirement that you make a demand for payment of the debt and that it go unpaid for a period of time following that demand.  While a debtor is actively seeking solutions such as borrowing, selling personal assets, or selling equity in the enterprise, it's not necessarily smart to immediately petition for involuntary bankruptcy.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:34:39 PM
If a bankruptcy is filed and you had $ or BTC at bitfloor, you should be included on the list of creditors, and you'll get periodic mailings about the progress of the matter.
Now we are getting to the really interesting stuff.  If BitFloor does not have any information on how to contact you, how will you get periodic mailings?

If some other legal action is filed, there's a pretty good chance you'll be included as a party, which would mean you'll get copies of filings,
See my question above.


The best thing to do is to make sure that BitFloor does have a mailing address for you - then there's no excuse for not giving you notice of proceedings. It's possible that a judge would order them to send notice via E-mail; but it's also possible that won't happen. The standard in the legal community is to communicate via postal mail, and the assumption is that everyone's got a postal address where they can be notified of things.

People who don't want to participate in that system don't have to, but they'll also need to get their news second-hand.



Title: Re: bitfloor needs your help!
Post by: fcmatt on September 04, 2012, 11:36:36 PM
No clear answer on how the hacker got in.... Without that one might as well assume owner took it. Bitcoins missing.... Oh well.
Show the logs and analysis!!!


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on September 04, 2012, 11:37:45 PM
Quote
Personally like it or not, I think on a long enough time line we will be in the "all" category.

Never.
And in no case shall that "all" be US law.


Title: Re: bitfloor needs your help!
Post by: barbarousrelic on September 04, 2012, 11:40:23 PM
No clear answer on how the hacker got in.... Without that one might as well assume owner took it. Bitcoins missing.... Oh well.
Show the logs and analysis!!!

I agree, the site owner should be considered the number one suspect in all of these Bitcoin website hacks that result in stolen Bitcoin. They have the means, the motive, and the convenient excuse (those damn hackers!)


Title: Re: bitfloor needs your help!
Post by: repentance on September 04, 2012, 11:43:06 PM
I'd just like to point out the importance of Bitfloor consulting an insolvency specialist and not a general lawyer.  You need someone who'll advise you on all of the legal options available and their pros and cons.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 04, 2012, 11:45:31 PM
Quote
It's also possible for a creditor to file a petition in bankruptcy court to force an uncooperative/insolvent debtor into bankruptcy.

While this is true, there is usually a requirement that you make a demand for payment of the debt and that it go unpaid for a period of time following that demand.  While a debtor is actively seeking solutions such as borrowing, selling personal assets, or selling equity in the enterprise, it's not necessarily smart to immediately petition for involuntary bankruptcy.

Agreed - I'm not saying it's a good idea (frankly I don't have enough facts to have an opinion about that) but mentioning it as a possibility. To me, this seems like it's headed for bankruptcy, unless all of the creditors are so small that individually it's just not worth filing suit. My hunch is that there are going to be a couple of people with balances in the tens of thousands of dollars (or equivalent in BTC) who will go ahead and file (similar to Cartmell v. Bitcoinica) because they'd rather spend a few thousand more getting something filed and use that as leverage to settle and/or to use the civil discovery process to figure out what's going on . . . and from the company's point of view, it probably makes more sense to spend their cash on bankruptcy attorneys rather than fight lawsuits, only to end up in bankruptcy after losing the lawsuits. The bankruptcy action will create an automatic stay on other matters, so regular civil suits will be frozen while the bankruptcy is resolved.


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 04, 2012, 11:46:10 PM
No clear answer on how the hacker got in.... Without that one might as well assume owner took it. Bitcoins missing.... Oh well.
Show the logs and analysis!!!

I agree, the site owner should be considered the number one suspect in all of these Bitcoin website hacks that result in stolen Bitcoin. They have the means, the motive, and the convenient excuse (those damn hackers!)

reopening the website/ports without audit is madness too unless you know exactly what happened and how to close hole.
plus possible backdoor left if attacker had permits to do so.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 11:46:35 PM
So is it now on me to remember to check Bitfloor.com or this thread a month, two months, three months from now to see if there's been unveiled a way for me to reclaim the part of my property that wasn't stolen?
Good question.  Here's two for you.  If it turns out that the only way for anyone to regain any of their property, Bitcoin or USD, is to file a petition with the court, will you bother to do so?  How many will?
I already assume my BTC is irrecoverable, and I won't seek to take the property of others to make up for my loss. However, I did have a few hundred USD at Bitfloor, and I would consider that my property, and I would like it returned. Now, legally, I am aware that pooled accounts have some disadvantages in bankruptcy situations. Although I personally believe my entire USD balance should be returned to me, I recognize that a court may decide to lump all customer deposits, both USD and BTC, in one large pot and then pay out the unstolen USD proportionally. Since I had more value in BTC at Bitfloor than I had in USD, that latter scenario would could actually be better for me financially, but I still think it's less morally sound than the strict, allocated treatment. But my views on morality have no bearing on what a judge will say. I will attempt to recover my USD balance, and if the judge wants to pay me a fraction of my USD balance but also compensate me a fraction of my BTC balance, I suppose I would take that deal.


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 04, 2012, 11:48:00 PM


I'll use bold next time, so as not to further confuse you.   8)

use bold with caution, or have you not read the entire thread?


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 04, 2012, 11:51:00 PM
I'm in for $2k now. Just remembered I had moved $1k from my ING account into BF getting ready for a purchase. Whitslack, Icebreaker, consider me in if it happens.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 04, 2012, 11:53:59 PM
No clear answer on how the hacker got in.... Without that one might as well assume owner took it. Bitcoins missing.... Oh well.
Show the logs and analysis!!!

I agree, the site owner should be considered the number one suspect in all of these Bitcoin website hacks that result in stolen Bitcoin. They have the means, the motive, and the convenient excuse (those damn hackers!)
I am not sure there is a motive. Of course Roman would like to get away with 24k BTC, but why not 50k BTC? Why not 100k BTC? He had the means to steal the bitcoins whenever he wanted. Bitfloor was gaining popularity. He had every reason to believe that the BTC balance would only increase. Unless he had some urgent need for BTC, it would have been better for him to wait for a larger balance to cash out. In other words, unless it can be shown that Roman was personally suffering a cash crunch, it would have been illogical for him to steal 24k BTC when he could have waited and stolen much more.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 04, 2012, 11:57:45 PM


I'll use bold next time, so as not to further confuse you.   8)

use bold with caution, or have you not read the entire thread?
;)

I suspect that the issue people had with 1nject0r had more to do with what he was saying and how he was saying it than the fact that he was using bold on every single word (though he may still have been asked to limit the bold to things that needed emphasis if people didn't mind the rest of it).


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 05, 2012, 12:01:16 AM
I will attempt to recover my USD balance, and if the judge wants to pay me a fraction of my USD balance but also compensate me a fraction of my BTC balance, I suppose I would take that deal.

Well, that's the thing about court, it's not really a "deal" that you take or don't take - the judge does what s/he does, and if you can explain why it was legally incorrect you can ask an appellate court to change the ruling. If your exposure is a few thousand USD or less, there's really no economic sense in fighting, it will cost more to fight than it would to just take your losses and move on.


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 12:04:55 AM

Agreed - I'm not saying it's a good idea (frankly I don't have enough facts to have an opinion about that) but mentioning it as a possibility. To me, this seems like it's headed for bankruptcy, unless all of the creditors are so small that individually it's just not worth filing suit. My hunch is that there are going to be a couple of people with balances in the tens of thousands of dollars (or equivalent in BTC) who will go ahead and file (similar to Cartmell v. Bitcoinica) because they'd rather spend a few thousand more getting something filed and use that as leverage to settle and/or to use the civil discovery process to figure out what's going on . . . and from the company's point of view, it probably makes more sense to spend their cash on bankruptcy attorneys rather than fight lawsuits, only to end up in bankruptcy after losing the lawsuits. The bankruptcy action will create an automatic stay on other matters, so regular civil suits will be frozen while the bankruptcy is resolved.

Historically what has happened is that the larger creditors and/or other service operators have sought to buy out the venture in trouble - Cartmell et all offered to do this with Bitcoinica.  World Bitcoin Exchange and Bitcoinica did not accept the offers which would have paid out all customers and left the operators with no remaining liability but it doesn't mean that Roman won't consider and accept any such offers.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 12:09:27 AM
I will attempt to recover my USD balance, and if the judge wants to pay me a fraction of my USD balance but also compensate me a fraction of my BTC balance, I suppose I would take that deal.

Well, that's the thing about court, it's not really a "deal" that you take or don't take - the judge does what s/he does, and if you can explain why it was legally incorrect you can ask an appellate court to change the ruling. If your exposure is a few thousand USD or less, there's really no economic sense in fighting, it will cost more to fight than it would to just take your losses and move on.
By "take that deal," I meant I would accept that payment and not reject it on moral grounds. My only choices would be to accept whatever the judge wants to pay out to me or to reject it. I can always refuse to take money. If the court decides I should be paid out in USD more than my USD balance at Bitfloor, I might try to refuse or return the part of the settlement that is above and beyond my USD balance, on the basis that I will not knowingly accept stolen property (and any USD settlement beyond my USD balance would necessarily have been stolen from other users who had predominantly USD balances at Bitfloor).


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:23:25 AM
@unclemantis... You should probably read the rest of the thread

Why? Should there be reason to panic?


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 05, 2012, 12:25:37 AM
If the court decides I should be paid out in USD more than my USD balance at Bitfloor, I might try to refuse or return the part of the settlement that is above and beyond my USD balance, on the basis that I will not knowingly accept stolen property (and any USD settlement beyond my USD balance would necessarily have been stolen from other users who had predominantly USD balances at Bitfloor).

My bet is that everyone with funds at Bitfloor will end up with a pro rata share of the total "deposits", with BTC valued at today or yesterday's average USD exchange rate. And court fees, attorney fees, accountant fees, trustee's fees, and all of the rest come out first.

So a pretty good outcome would probably look like 25% of your total deposits (assuming, overall, that half of the value deposited was BTC (which is now gone) and half was USD, and half of what's left gets spent on the friction of litigation), and you'll probably get it in 12-18 months.

This is why we can't have nice things.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 05, 2012, 12:26:36 AM
@unclemantis... You should probably read the rest of the thread

Why? Should there be reason to panic?
Yes, it looks like bit floor as we knew it is gone :(


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:26:51 AM
I have put the website back online for users who have USD to request a withdrawal via ACH. If you choose to leave your USD funds in the account they will be available for trading once it resumes. I hope to resume trading later in the week.

If you had outstanding orders they have all been cancelled.

Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.

Can you give us a scheduled date and time so that we can be ready out of the gates?


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:35:50 AM
I have put the website back online for users who have USD to request a withdrawal via ACH. . .Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
Can you give us a scheduled date and time so that we can be ready out of the gates?

See here:

Please note that I have taken the website offline. I am consulting legal council about the current situation . . .


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 12:36:23 AM
Yes, it looks like bit floor as we knew it is gone :(
How sad it is that Bitfloor will be forced out of business and no one will be made whole, when Mr. Shtylman has already indicated that he would like to reopen trading and use the collected fees to repay everyone. It could take years to repay the losses, but eventual repayment of everything everyone is owed would be better than shutting it all down. This is an example of how our legal system is horribly broken. Roman wants to work to make it 100% right in the long-term, but the court wants the short-term compromise at the expense of making the long-term restitution impossible.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:38:09 AM
I have put the website back online for users who have USD to request a withdrawal via ACH. . .Once trading resumes, I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
Can you give us a scheduled date and time so that we can be ready out of the gates?

See here:

Please note that I have taken the website offline. I am consulting legal council about the current situation . . .

OH MY GOD!

I have a lot of money tied up in a BID.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:41:22 AM
Yes, it looks like bit floor as we knew it is gone :(
How sad it is that Bitfloor will be forced out of business and no one will be made whole, when Mr. Shtylman has already indicated that he would like to reopen trading and use the collected fees to repay everyone. It could take years to repay the losses, but eventual repayment of everything everyone is owed would be better than shutting it all down. This is an example of how our legal system is horribly broken. Roman wants to work to make it 100% right in the long-term, but the court wants the short-term compromise at the expense of making the long-term restitution impossible.
This isn't the fault of the court system.  If everyone involved wanted the same, the courts would likely be happy to allow it to proceed as you've described.

The issue is that there may be more people who want their BTC or USD returned now.  This means that the courts have to step in and dice it all up to satisfy the demands of the debtors.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:43:58 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:44:15 AM
. . . I hope to be able to start repaying BTC losses using the proceeds from fees. More information about this will be provided later.
Can you give us a scheduled date and time so that we can be ready out of the gates?
See here:
Please note that I have taken the website offline. I am consulting legal council about the current situation . . .
OH MY GOD!
Such are the risks of engaging in transactions with an uninsured, unregulated, un-audited business


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 12:44:28 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:46:28 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 05, 2012, 12:47:59 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.
+1 but I would want Roman to maintain some percentage of the company because we would need someone to run the show and we would want him to stay stay motiviated to continue the process.  With no motiviation I might as well invest in the post office or the government.  


Title: Re: bitfloor needs your help!
Post by: muyuu on September 05, 2012, 12:48:33 AM
Yes, it looks like bit floor as we knew it is gone :(
How sad it is that Bitfloor will be forced out of business and no one will be made whole, when Mr. Shtylman has already indicated that he would like to reopen trading and use the collected fees to repay everyone. It could take years to repay the losses, but eventual repayment of everything everyone is owed would be better than shutting it all down. This is an example of how our legal system is horribly broken. Roman wants to work to make it 100% right in the long-term, but the court wants the short-term compromise at the expense of making the long-term restitution impossible.

He can try two things:

- emergency partial or total buy-out for a sum big enough to cover the losses
- try an IPO in GLBSE for ~75K+, enough to repay, move out of the bloody VPS and hire at least 1 partner to overlook operation, and also keep some BTC to cover possible accidents with the hot-wallet. Satoshidice shot at ~320K, maybe enough people believe Bitfloor is worth more then 75K+ long term with the proper operation
- try to pull a pirateat40. He's way too public to try that, I certainly wouldn't recommend.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:49:05 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.
Nice idea, but what if someone who had a lot of BTC on deposit with BitFloor believes that they have a better chance in the courts than they do selling of shares of BitFloor?  How do you convince everybody to go along with your plan?


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 12:50:49 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.
+1 but I would want Roman to maintain some percentage of the company because we would need someone to run the show and we would want him to stay stay motiviated to continue the process.  With no motiviation I might as well invest in the post office or the government.

He would be able to purchase shares in Bitfloor on the GLBSE. If he doesn't want to, and if he doesn't want to continue operating Bitfloor, the shareholders could oust him from the company and vote in a new CEO.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:52:31 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 05, 2012, 12:52:46 AM
I go to the site and it reads this (which it still reads)

Bitfloor Website
Is currently offline.

It will be back shortly.

I check back later and its up. So I sent 136 coin to my deposit address.

Anyone else think the message on the site should read

DO NOT SEND ANY COIN TO US WE HAVE BEEN HACKED!!!!!

or something of that nature. I only keep my money in coin for less than 24 hours before converting it and got screwed. Guess I stop taking bitcoin cause its too risky.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:54:39 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.
You can hope so, but until the Terms Of Service are reviewed and all legal options are considered BitFloor isn't likely to agree with you.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:55:11 AM
I go to the site and it reads this (which it still reads)

Bitfloor Website
Is currently offline.

It will be back shortly.

I check back later and its up. So I sent 136 coin to my deposit address.

Anyone else think the message on the site should read

DO NOT SEND ANY COIN TO US WE HAVE BEEN HACKED!!!!!

or something of that nature. I only keep my money in coin for less than 24 hours before converting it and got screwed. Guess I stop taking bitcoin cause its too risky.

Speaking like a true Junior.

Imagine how Bitfloor feels right now.


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 12:56:15 AM
Roman wants to work to make it 100% right in the long-term, but the court wants the short-term compromise at the expense of making the long-term restitution impossible.

What court?  He hasn't even got legal advice yet and is - wisely - suspending the service until he has done so.

There is absolutely nothing to prevent someone who goes through formal insolvency proceedings from paying back every one of their creditors in full even decades later - that's a personal choice, not a legal requirement.

People willing to wait can also not file a claim against the insolvent estate - that would mean those who want quick and certain payment would be paid  out to the extent allowed by the assets while others could seek a different form of, longer term, repayment.



Title: Re: bitfloor needs your help!
Post by: jojo69 on September 05, 2012, 12:56:24 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.

you really need to read the whole thread, unless you had a USD transfer out pending your funds are likely to be tied up in court


Title: Re: bitfloor needs your help!
Post by: muyuu on September 05, 2012, 12:56:50 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.
+1 but I would want Roman to maintain some percentage of the company because we would need someone to run the show and we would want him to stay stay motiviated to continue the process.  With no motiviation I might as well invest in the post office or the government.

He would be able to purchase shares in Bitfloor on the GLBSE. If he doesn't want to, and if he doesn't want to continue operating Bitfloor, the shareholders could oust him from the company and vote in a new CEO.

Who would understand his code better than him?

It makes no sense to let him sell the 100% just for covering the loss and then, knowing it makes a measly 2K US$ a month and that it will be shared in dividends, pretend he will be motivated to work or that someone capable will work for wages low enough for the company to turn a profit.

The IPO should be for about 300% of the losses so infrastructure can be improved from the start, and at least a partner can be hired (a 1-man exchange is asking for trouble). It all depends on how much do people value a properly operating Bitfloor in the long term. I think 75K+ is fair, maybe 100K+.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:57:17 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.
You can hope so, but until the Terms Of Service are reviewed and all legal options are considered BitFloor isn't likely to agree with you.

That is bullshit. I have a lot of money held up in this MISTAKE. I am trying really hard not to be one of the bad buys but it is a lot of money :( In my eyes that is.

Also I TRUST BITCOIN. Just the coin.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:57:21 AM
. . .Guess I stop taking bitcoin cause its too risky.
Your first mistake was getting involved with bitcoin without understanding what the risks are and determining if those risks exceeded your risk tolerance.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 12:58:14 AM
. . .Guess I stop taking bitcoin cause its too risky.
Your first mistake was getting involved with bitcoin without understanding what the risks are and determining if those risks exceeded your risk tolerance.

I trust bitcoin. it is the human factor that is RISKY.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 12:58:23 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.
Nice idea, but what if someone who had a lot of BTC on deposit with BitFloor believes that they have a better chance in the courts than they do selling of shares of BitFloor?  How do you convince everybody to go along with your plan?
Maybe it's not necessary to convince everybody. Let it go to court. Let the settlements be decided. Then give each plaintiff the choice of whether to be paid out in USD or in Bitfloor stock. Ownership in the company would then be divided proportionately among all those who opted for stock. The dollars remaining in Bitfloor's coffers would be distributed proportionately to all those who opted for money. It would be up to the court to decide whether to distribute all of the USD to those requesting the monetary compensation option or to hold back an amount in proportion to the balances of those who opted for stock compensation and then issue a one-time dividend of that remaining amount to the new shareholders.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 05, 2012, 12:58:49 AM
Following from my previous post, here's an interesting idea. Roman Shtylman, please read this and consider...

What if Bitfloor went public on the GLBSE and distributed 100% ownership of the company to the users who lost BTC in the heist, proportionally according to their lost BTC balances. For example, issue ~24,000,000 shares (one share for each 0.001 BTC that was stolen), and distribute the shares proportionately to the users whose BTC was stolen. Then Bitfloor would pay 100% of its operating profits (revenues minus operating expenses) proportionately to its shareholders. The new shareholders could either sit on their newly granted shares, sell them to recoup whatever money they could get, or buy more shares from others who are unloading theirs.

So Roman would work eternally for 0% equity?  I don't see that being viable.

He would be much better off under Bankruptcy protection.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 05, 2012, 12:59:08 AM
He has a responsibility to let people know not to send bitcoin to hacked addresses. We will be back could be server maintenance ect.... I have checked the site all day and nothing so he waiting for how many trades to take place or api trades to take place before starting a thread on bitcointalk.org honestly I think bitfloor is the JR on this one. I'm in business to make money taking a thousand dollar hit on one of the most used trading sites can I really be blamed as feeling uneasy on my fourth bitcoin payment for my services being lost due to negligence.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 01:01:16 AM
He has a responsibility to let people know not to send bitcoin to hacked addresses. We will be back could be server maintenance ect.... I have checked the site all day and nothing so he waiting for how many trades to take place or api trades to take place before starting a thread on bitcointalk.org honestly I think bitfloor is the JR on this one. I'm in business to make money taking a thousand dollar hit on one of the most used trading sites can I really be blamed as feeling uneasy on my fourth bitcoin payment for my services being lost due to negligence.

Making money by pushing money around is risky.

You want to take zero risk? Open a coffee shop.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:01:29 AM
The IPO should be for about 300% of the losses so infrastructure can be improved from the start, and at least a partner can be hired (a 1-man exchange is asking for trouble). It all depends on how much do people value a properly operating Bitfloor in the long term. I think 75K+ is fair, maybe 100K+.
+1
I think Bitfloor has enormous growth potential. My opinion is that Bitfloor is vastly technologically superior to Mt. Gox, modulo today's failing. I suspect, with a proper treatise on the security failure and security architecture plan for moving forward, Bitfloor could raise enough in an IPO to pay everyone back and resume operations with an improved platform.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:02:43 AM
Making money by pushing money around is risky.

You want to take zero risk? Open a coffee shop.
LoL! Spoken like a total n00b! The only risk-free business is borrowing from the Federal Reserve at 0% and lending out at 5%+, and only Too-Big-To-Fail banks get to do that.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 05, 2012, 01:04:21 AM
The IPO should be for about 300% of the losses so infrastructure can be improved from the start, and at least a partner can be hired (a 1-man exchange is asking for trouble). It all depends on how much do people value a properly operating Bitfloor in the long term. I think 75K+ is fair, maybe 100K+.
+1
I think Bitfloor has enormous growth potential. My opinion is that Bitfloor is vastly technologically superior to Mt. Gox, modulo today's failing. I suspect, with a proper treatise on the security failure and security architecture plan for moving forward, Bitfloor could raise enough in an IPO to pay everyone back and resume operations with an improved platform.

So he has no responsibility and anyone who did business with him is just an idiot? I understand that I took a risk with bitfloor regardless you dont think its crap the HE STILL HAS NOTHING on the site about not sending payments to hacked accounts? I know anyone who sends money there is dumb and taking a huge risk but regardless he has zero responsibility in your eyes?


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 05, 2012, 01:05:46 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 01:07:17 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.
You can hope so, but until the Terms Of Service are reviewed and all legal options are considered BitFloor isn't likely to agree with you.

That is bullshit. I have a lot of money held up in this MISTAKE. I am trying really hard not to be one of the bad buys but it is a lot of money. . .
I can understand your frustration.  Unfortunately your point of view isn't the only point of view in this matter.  As such, BitCoin has done the only thing they can to protect themselves, they've engaged legal counsel.  After that, what happens will depend a lot more on how the lawyers interpret the Terms Of Service and current law than what you want to have happen.

For your sake I hope that the lawyers quickly determine that BitFloor is required to immediately pay back all USD on deposit.  Somehow, I doubt that will be the case though.

Such are the risks of handing over your money to an unregulated, uninsured, un-audited company.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:07:22 AM
I know anyone who sends money there is dumb and taking a huge risk but regardless he has zero responsibility in your eyes?
with a proper treatise on the security failure and security architecture plan for moving forward
I wouldn't blindly invest in Bitfloor now. I would need to see that the security of the platform has received an overhaul, and I would need to fully understand it and agree with its competency and adequacy. Then I would invest.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 05, 2012, 01:07:30 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement

BTC sent in after the hack will be going directly to the attacker.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 05, 2012, 01:07:47 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement

What about the people who don't go here. Shouldn't the site have a warning or an e-mail blast? This is kinda like lets post on bitcointalk and hope everyone knows to go read there before sending or god forbid an automated system since they advertized having api for that very reason.


Title: Re: bitfloor needs your help!
Post by: Shagnasty on September 05, 2012, 01:09:38 AM
So how do i get back that 20 dollars I deposited right before your announcement? Shouldn't have left your account accepting deposits.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 05, 2012, 01:09:54 AM
Making money by pushing money around is risky.

You want to take zero risk? Open a coffee shop.
LoL! Spoken like a total n00b! The only risk-free business is borrowing from the Federal Reserve at 0% and lending out at 5%+, and only Too-Big-To-Fail banks get to do that.

Correct. I am still a n00b in the bitcoin world only being in it for about a year.

Now the money part I am complete n00b. I let my wife handle the finances.

Now the technical part of bitcoin I am able to understand...

the money part.... not so much :)

I got burned and that is that.


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 01:10:12 AM

Maybe it's not necessary to convince everybody. Let it go to court. Let the settlements be decided. Then give each plaintiff the choice of whether to be paid out in USD or in Bitfloor stock. Ownership in the company would then be divided proportionately among all those who opted for stock. The dollars remaining in Bitfloor's coffers would be distributed proportionately to all those who opted for money. It would be up to the court to decide whether to distribute all of the USD to those requesting the monetary compensation option or to hold back an amount in proportion to the balances of those who opted for stock compensation and then issue a one-time dividend of that remaining amount to the new shareholders.


A court will order compensation in USD.  They're not going to fuck around consulting creditors about what they want - if credtors could agree with Bitfloor on that, then the matter wouldn't be before a court in the first place.

Also, before initiating convoluted court cases, it's wise to remember that the legal fees of an insolvent estate come out of that estate and further reduce the amount available for distribution to creditors.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 01:12:11 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement

What about the people who don't go here. Shouldn't the site have a warning or an e-mail blast? . . .

As soon as BitFloor realized the extent of their legal problem, they shut down the site, contacted legal counsel and haven't brought the site back up or said another word here on bitcointalk (as I would expect their lawyers would advise them).

What is their responsibility prior to their realization of how deep they were?  Did they act in good faith, or was there intentional fraud?  This is yet to be determined, but my personal suspicions are that they have acted in good faith (though poor security) so far.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:12:27 AM
Correct. I am still a n00b in the bitcoin world only being in it for about a year.

Now the money part I am complete n00b. I let my wife handle the finances.

Now the technical part of bitcoin I am able to understand...

the money part.... not so much :)

I got burned and that is that.
I didn't mean a n00b about Bitcoin or about money. I meant a n00b about business. If your impression is that running a coffee shop is risk-free, then I would advise you never to open a coffee shop.


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 05, 2012, 01:12:44 AM
The only people profiting from bitcoin are hackers. Fuck this shit.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:16:02 AM
A court will order compensation in USD.  They're not going to fuck around consulting creditors about what they want - if credtors could agree with Bitfloor on that, then the matter wouldn't be before a court in the first place.
Not necessarily. I've been a beneficiary in a class action lawsuit in which I was given options about how I wanted to receive settlement. I could opt for a check, or I could opt for a smaller check and some store credit, or I could opt for all store credit (in an amount larger than the check option). I see no reason why I couldn't be given an option regarding Bitfloor of either an ACH deposit of USD or a GLBSE grant of Bitfloor stock.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 01:17:10 AM
So how do i get back that 20 dollars I deposited right before your announcement? Shouldn't have left your account accepting deposits.
As soon as BitFloor realized they were in deep, they contacted legal counsel, shut down the site, and stopped posting here (as I would expect their lawyers to advise them).  Prior to this, it is my opinion that they acted in naive but good faith to attempt to address the situation as equitably as possible.  I may be wrong and you may disagree, but aside from getting your own legal counsel your recourse is rather limited at the moment.  Such are the risks taken when choosing to engage in business with BitFloor.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 05, 2012, 01:19:22 AM
I am pretty sure my order did not go through. Just ACH me the amount that I deposited the other day.

Thank you.
Unlikely to occur unless/until BitFloor's legal counsel advises them to proceed.  There is a possibility that this will go to courts to determine what BitFloor's liabilities are and how much (if anything) you will get.

If my order never went through then the money is still 100 percent mine.
You can hope so, but until the Terms Of Service are reviewed and all legal options are considered BitFloor isn't likely to agree with you.

That is bullshit. I have a lot of money held up in this MISTAKE. I am trying really hard not to be one of the bad buys but it is a lot of money :( In my eyes that is.

Also I TRUST BITCOIN. Just the coin.

Don't worry unclemantis, we USD owners are not the bad guys.  The Marxist lawyers infesting our legal system, and their enabling apologists here, are the bad guys. 

Are we going to let them tell us we have no property rights, "because bitcoin" or "because MFGlobal?"  I say Hell No!

If BitFloor (Roman) doesn't stop listening to them and keeps our USD without our consent, he becomes a bad guy as well.   :-\

Let's hope he decides to respect common law, common sense, and common decency by returning all USD to the rightful owners ASAP.

No court is going to grant bitcoins equal status to USD.  Bitcoins are ephemeral virtual tokens produced in an experiment which requires willful, voluntary participation (and thus assumption of associated risks/outcomes).

OTOH, USD are the legal tender of the US.  It is beyond ridiculous for BitFloor to steal our USD because of unrelated, unfortunate events pertaining to bitcoins.

Everyone owed USD by BitFloor should let them know we aren't playing, by sending him a Letter of Demand.  You don't have to have/be a lawyer to write/send one.

Until there is an official bankruptcy filing, no legal shield exists (besides TOS?) to insulate BitFloor from our lawful demands.


Title: Re: bitfloor needs your help!
Post by: exdirrk on September 05, 2012, 01:22:57 AM
The only people profiting from bitcoin are hackers. Fuck this shit.

I haven't lost anything yet from bitcoin but it does seem like hackers are just having a field day with it.  As much as everyone hates Mt.Gox because of the cost to put money on there and the loss of anonymity, it seems like they have the best methods on there.  I feel like bit floor should have known better than to have all of their coins in a hot wallet after btc-e and other hacks.  


Title: Re: bitfloor needs your help!
Post by: Ilikeham on September 05, 2012, 01:23:31 AM
Seems to me these places get hacked at a magic number that fits with a lifestyle change.



Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 01:25:25 AM
Roman is trying to do the right thing, with all the information he has available. You guys with USD on the site, please be patient. You can see he tried to let you withdraw, but probably thought it better to make sure he wasn't doing anything illegal as Stephen kept reiterating. There's nothing shady about that. Hopefully he will continue with that soon.

Every dealing I've had with Roman has been both pleasant and very professional. His exchange was by far the best Bitcoin exchange we currently have available to us. I never left holdings there, I just bought and withdrew, so I don't have an immediate financial stake in what happens next. But I implore those of you that are owed USD and BTC to give him chance to settle things in such a way that won't destroy his exchange. Selling securities is one option that could solve this. 24k BTC is a lot but it's not an unrecoverable amount.

How poorly things go from here on out will depend on more than just Roman. Please consider your demands and actions carefully.



Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:32:48 AM
Every dealing I've had with Roman has been both pleasant and very professional. His exchange was by far the best Bitcoin exchange we currently have available to us.
Likewise. A real class act. In retrospect, he is apparently not a security genius, but that doesn't make him evil or even shady. Once the legal system gets involved, everything slows down to a rate even slower than the Post Office. It's unbearable for those of us accustomed to the lightning-paced world of Bitcoin and the Internet in general, but the legal system is just ploddingly slow, and we'll have to accept that. Roman may not be responding to us right now, but that is because his hands are tied at present by the legal system. He's waiting for it to catch up just as much as we are.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 05, 2012, 01:32:59 AM
Seems to me these places get hacked at a magic number that fits with a lifestyle change.
As much as everyone hates Mt.Gox because of the cost to put money on there and the loss of anonymity, it seems like they have the best methods on there.

Don't forget that we don't know everything. It's perfectly possible that other exchanges are being hacked (broadly speaking) for less than "lifestyle change" amounts, but the operators choose to eat the losses themselves and keep operating (cf. BTC-E a few weeks ago).

It's also perfectly possible that other exchanges are being hacked in "lifestyle change" amounts but they continue to operate in a combination Ponzi/Flying Dutchman mode, accepting deposits and cheerfully reporting "balances" that are pure fiction, hoping that someday they'll make enough "profit" to earn their way back to solvency, or just because they can't bring themselves to admit that things are broken. The deeper the lies go, the harder it is to come clean.

If an exchange was doing that, some people would probably hold them up as a shining example of a well-run exchange that was impervious to hacks.



Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 05, 2012, 01:36:08 AM
Roman is trying to do the right thing, with all the information he has available. You guys with USD on the site, please be patient. You can see he tried to let you withdraw, but probably thought it better to make sure he wasn't doing anything illegal as Stephen kept reiterating. There's nothing shady about that. Hopefully he will continue with that soon.

Every dealing I've had with Roman has been both pleasant and very professional. His exchange was by far the best Bitcoin exchange we currently have available to us. I never left holdings there, I just bought and withdrew, so I don't have an immediate financial stake in what happens next. But I implore those of you that are owed USD and BTC to give him chance to settle things in such a way that won't destroy his exchange. Selling securities is one option that could solve this. 24k BTC is a lot but it's not an unrecoverable amount.

How poorly things go from here on out will depend on more than just Roman. Please consider your demands and actions carefully.

I am very willing to wait to withdraw my USD until BitFloor.com has been audited and secured.  That is a perfectly reasonable and desirable course of action.

I am not willing to wait to withdraw my USD while overpaid Marxist lawyers debate whether my property is, in fact, actually mine or simply a means to a communal end.

Common sense, common law, and common decency say that the presumption of ownership remains with the original USD depositors.

That is why I have no patience with anyone willing to entertain/support the amoral, collectivist Marxist lawyer POV of negotiable property rights.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 05, 2012, 01:37:02 AM
Quote
Roman is trying to do the right thing, with all the information he has available. You guys with USD on the site, please be patient. You can see he tried to let you withdraw, but probably thought it better to make sure he wasn't doing anything illegal as Stephen kept reiterating. There's nothing shady about that. Hopefully he will continue with that soon.

Well sadly Stephen was misinformed and likely turned a bad situation into a worse one.  His talk of injunctions and criminal activity were simply false.  I am just not certain if it was coming from a place of intentional malfeasance or simple ignorance.

I do agree with you jwzguy, that bitfloor has a lot going for it and the situation isn't intractable.


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 05, 2012, 01:38:03 AM
The only people profiting from bitcoin are hackers. Fuck this shit.

I haven't lost anything yet from bitcoin but it does seem like hackers are just having a field day with it.  As much as everyone hates Mt.Gox because of the cost to put money on there and the loss of anonymity, it seems like they have the best methods on there.  I feel like bit floor should have known better than to have all of their coins in a hot wallet after btc-e and other hacks.  

Any business researching bitcoin and thinking of accepting them will probably also say "fuck this shit" and avoid it altogether. Especially if their legal department has anything to say about it.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 01:38:49 AM
It's also perfectly possible that other exchanges are being hacked in "lifestyle change" amounts but they continue to operate in a combination Ponzi/Flying Dutchman mode, accepting deposits and cheerfully reporting "balances" that are pure fiction, hoping that someday they'll make enough "profit" to earn their way back to solvency, or just because they can't bring themselves to admit that things are broken. The deeper the lies go, the harder it is to come clean.

If an exchange was doing that, some people would probably hold them up as a shining example of a well-run exchange that was impervious to hacks.
I'll point out that Mt.Gox is a Japanese company. The culture over there is even less inclined to admit fiduciary mistakes than it is in the Western world. Look at TEPCO for a prime example. If the underbelly of Mt.Gox were being eroded away by security breaches, they might not say a word.


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 01:52:35 AM
The only people profiting from bitcoin are hackers. Fuck this shit.

I haven't lost anything yet from bitcoin but it does seem like hackers are just having a field day with it.  As much as everyone hates Mt.Gox because of the cost to put money on there and the loss of anonymity, it seems like they have the best methods on there.  I feel like bit floor should have known better than to have all of their coins in a hot wallet after btc-e and other hacks.  

Exchanges are damned if they do and damned if they don't.  People want the convenience of being able to do instant withdrawals and transfers without any of the risk.

Small Bitcoin services which hold large amounts of other people's BTC are hacker magnets and intruders know that such services are often one or two man operations without capital reserves to invest in infrastructure.  They're soft targets.  Security needs to be baked in from the day a service is created but many Bitcoin services are more concerned about rushing to market than they are about security (they probably tell themselves they'll invest in "proper" security once the profits are rolling in, not realising that a rapidly expanding business often makes little or no profit).

Until Bitcoin service providers lift their game security-wise, people should severely limit the amount of BTC they store on such services.   Bitcoins stored on a service are always at risk.  You accept the risk of them being lost or stolen by leaving them on deposit with a service.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 01:53:06 AM
Quote
Roman is trying to do the right thing, with all the information he has available. You guys with USD on the site, please be patient. You can see he tried to let you withdraw, but probably thought it better to make sure he wasn't doing anything illegal as Stephen kept reiterating. There's nothing shady about that. Hopefully he will continue with that soon.

Well sadly Stephen was misinformed and likely turned a bad situation into a worse one.  His talk of injunctions and criminal activity were simply false.  I am just not certain if it was coming from a place of intentional malfeasance or simple ignorance.

I do agree with you jwzguy, that bitfloor has a lot going for it and the situation isn't intractable.
I completely agree, and I think you're correct. Of course I'm not a lawyer, and not responsible for all that money...I certainly don't blame him for wanting to check. I can only imagine the stress he's going through right now.

Icebreaker - please don't jump to conclusions just because someone here is being very opinionated. From his behavior, I think Roman must agree with you.



Title: Re: bitfloor needs your help!
Post by: Shadow383 on September 05, 2012, 01:53:11 AM
Wow, somebody at Linode really is making a fortune from Bitcoin  ::)
Linode's stolen what? 80K BTC? About $800k?
Not bad.


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 05, 2012, 02:04:42 AM
Wow, somebody at Linode really is making a fortune from Bitcoin  ::)
Linode's stolen what? 80K BTC? About $800k?
Not bad.

i am of the opinion the owner of bitfloor has very little idea what happened.

put it this way.. he put the site back online. does that sound like someone who knows security?

at the very least you nuke the install from orbit, reinstall a clean patched os, recover from backups,

AND fix the darn hole.

I do not think that happened. I would like to know how they got in.


Title: Re: bitfloor needs your help!
Post by: giszmo on September 05, 2012, 02:15:14 AM
Maybe we should go for fractional reserve for security. Exchanges don't have to hold any bitcoins and instead of charging addresses, they show withdrawal addresses that were earlier posted to them by people wanting to withdraw. This would only imply a slight delay here and there but provide much more security.</irony>


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 05, 2012, 02:19:06 AM
Maybe we should go for fractional reserve for security. Exchanges don't have to hold any bitcoins and instead of charging addresses, they show withdrawal addresses that were earlier posted to them by people wanting to withdraw. This would only imply a slight delay here and there but provide much more security.</irony>


It would be a lot easier if the hackers would accept USD, then we wouldn't have to go to the trouble of converting to BTC so it can be stolen.

Or we could just put the account records on a wiki, and we can just update the wiki when we make deposits and withdrawls. Then the exchange operators wouldn't even need to log in to their own site.



Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 02:28:02 AM
It would be a lot easier if the hackers would accept USD, then we wouldn't have to go to the trouble of converting to BTC so it can be stolen.
LoL! They do. Those hackers are known as "banksters."


Title: Re: bitfloor needs your help!
Post by: stoppots on September 05, 2012, 02:47:48 AM

Sounds like the cold storage was deposited with pirate.
 


Title: Re: bitfloor needs your help!
Post by: bitcorn on September 05, 2012, 02:48:20 AM
I go to the site and it reads this (which it still reads)

Bitfloor Website
Is currently offline.
It will be back shortly.
I check back later and its up. So I sent 136 coin to my deposit address.
Anyone else think the message on the site should read
DO NOT SEND ANY COIN TO US WE HAVE BEEN HACKED!!!!!
or something of that nature. I only keep my money in coin for less than 24 hours before converting it and got screwed. Guess I stop taking bitcoin cause its too risky.

Speaking like a true Junior.

Imagine how Bitfloor feels right now.

Speaking of Junior League: looking through Google's cache of bitfloor, and maybe I'm just missing something obvious here, but I don't see TOS at all. Did bitfloor users agree to a specific TOS via email, or some form of messaging, or… what?


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 05, 2012, 02:57:56 AM
Wow, somebody at Linode really is making a fortune from Bitcoin  ::)
Linode's stolen what? 80K BTC? About $800k?
Not bad.

i am of the opinion the owner of bitfloor has very little idea what happened.

put it this way.. he put the site back online. does that sound like someone who knows security?

at the very least you nuke the install from orbit, reinstall a clean patched os, recover from backups,

AND fix the darn hole.

I do not think that happened. I would like to know how they got in.

Especially on a supposed semi-airgapped machine.  My theory:  roman allowed access from his machine for connivence and they compromised THAT which allowed them to pivot into the cold storage server.

Also as to the backun on an unencrypted portion of the disk:  this would make no difference if they were logged into the running server, unless the encrypted volume was usually unmounted (which does not sound like it was).  It sounds like the machine used encryption, but that only really defeats cold attacks on the disk.


Title: Re: bitfloor needs your help!
Post by: IveBeenBit on September 05, 2012, 03:10:47 AM
Speaking of Junior League: looking through Google's cache of bitfloor, and maybe I'm just missing something obvious here, but I don't see TOS at all. Did bitfloor users agree to a specific TOS via email, or some form of messaging, or… what?

I actually don't remember seeing one, either, and at one point, I DID go looking for one to clarify one of their policies, but wound up just emailing support instead.


Title: Re: bitfloor needs your help!
Post by: thebaron on September 05, 2012, 03:16:49 AM
In b4 pirateat40 ran bitfloor.


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 05, 2012, 03:23:16 AM
Wow, somebody at Linode really is making a fortune from Bitcoin  ::)
Linode's stolen what? 80K BTC? About $800k?
Not bad.

i am of the opinion the owner of bitfloor has very little idea what happened.

put it this way.. he put the site back online. does that sound like someone who knows security?

at the very least you nuke the install from orbit, reinstall a clean patched os, recover from backups,

AND fix the darn hole.

I do not think that happened. I would like to know how they got in.

Especially on a supposed semi-airgapped machine.  My theory:  roman allowed access from his machine for connivence and they compromised THAT which allowed them to pivot into the cold storage server.

Also as to the backun on an unencrypted portion of the disk:  this would make no difference if they were logged into the running server, unless the encrypted volume was usually unmounted (which does not sound like it was).  It sounds like the machine used encryption, but that only really defeats cold attacks on the disk.

I dunno. He used linode and i would guess to save money it was vps. Not a few dedicated machines.


Title: Re: bitfloor needs your help!
Post by: dust on September 05, 2012, 03:27:21 AM
I'm not sure why anyone would use Linode for anything bitcoin related after multiple simultaneous hackings of bitcoin services through the internal customer service panel resulted in barely any response or details from Linode admins.


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 05, 2012, 03:30:05 AM
I'm not sure why anyone would use Linode for anything bitcoin related after multiple simultaneous hackings of bitcoin services through the internal customer service panel resulted in barely any response or details from Linode admins.

It is cheap, advertised, and maybe OP did not read the threads about it.

I am going to guess mysql inject, found a crypt pass or plain text pass of OP, then logged in via ssh or web which had no acls.


Title: Re: bitfloor needs your help!
Post by: Shadow383 on September 05, 2012, 03:42:42 AM
I'm not sure why anyone would use Linode for anything bitcoin related after multiple simultaneous hackings of bitcoin services through the internal customer service panel resulted in barely any response or details from Linode admins.

It is cheap, advertised, and maybe OP did not read the threads about it.

I am going to guess mysql inject, found a crypt pass or plain text pass of OP, then logged in via ssh or web which had no acls.
I'm going to guess someone at linode has a car that seems very expensive for their salary.


Title: Re: bitfloor needs your help!
Post by: Domrada on September 05, 2012, 03:45:27 AM
Roman:

If you decide to raise money from investors, please send me a pm.


Title: Re: bitfloor needs your help!
Post by: lomax on September 05, 2012, 04:33:01 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement

What about the people who don't go here. Shouldn't the site have a warning or an e-mail blast? This is kinda like lets post on bitcointalk and hope everyone knows to go read there before sending or god forbid an automated system since they advertized having api for that very reason.

You are 100% correct, there is still nothing on the website to indicate that it is down for anything other than some trivial maintenance. Relying on your customers to read this thread is insane.


Title: Re: bitfloor needs your help!
Post by: Maria on September 05, 2012, 04:44:16 AM
I had 4,231 BTC in Bitfloor. I want my money NOW!


Just kidding, lol! Thank God a few months ago I was going to make a HUGE deposit to bitfloor but a very Wise Man told me.."Stay away from that dude, hes a fucking idiot, he uses his personal bank account for deposits and withdrawals.."

I Thank You Sir You Know Who You Are!!

MultiCoin Maria.

Dont hate


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 04:48:56 AM
I had 4,231 BTC in Bitfloor. I want my money NOW!


Just kidding, lol! Thank God a few months ago I was going to make a HUGE deposit to bitfloor but a very Wise Man told me.."Stay away from that dude, hes a fucking idiot, he uses his personal bank account for deposits and withdrawals.."

I Thank You Sir You Know Who You Are!!

MultiCoin Maria.

Dont hate
Oh look, the forex scammer! And another lie. How predictable.
Glad to see that so many people have you on ignore, Leo.


Title: Re: bitfloor needs your help!
Post by: Shagnasty on September 05, 2012, 04:49:40 AM
it seems likely that BTC sent in AFTER the hack announcement may be set aside in an eventual settlement

What about the people who don't go here. Shouldn't the site have a warning or an e-mail blast? This is kinda like lets post on bitcointalk and hope everyone knows to go read there before sending or god forbid an automated system since they advertized having api for that very reason.

You are 100% correct, there is still nothing on the website to indicate that it is down for anything other than some trivial maintenance. Relying on your customers to read this thread is insane.
Would have saved me 20 bucks. This morning around 3am it was down and then it was running around 5 am so Ithought it was maintence. I made a deposit request at 5 am. Woke up around 4:30 pm and went to chase and made the deposit. I then checked the site and it was down again with no explanation. I emailed support with no response. Why wouldn't he send an email the minute he learned or thought something was wrong to not deposit money if you haven't done it yet.


Title: Re: bitfloor needs your help!
Post by: peasant on September 05, 2012, 04:49:59 AM
I don't understand why no one was emailed. For a situation this serious the forum isn't gonna cut it.


Title: Re: bitfloor needs your help!
Post by: BkkCoins on September 05, 2012, 05:50:48 AM
This is so exasperating. It's no wonder Bitcoin is becoming a laughing stock. It's simply not enough to claim the blockchain is safe when every service that people use ends up getting hacked and large sums being lost.

Frankly, if an unencrypted backup of keys was left on the server then the current operators are not worthy of continuing to run the exchange and anyone who places their trust in righting the ship and sailing onwards as if all is ok, is a fool. Is this going to be a payback-over-a-year ordeal or yet another "oops, we were hacked!" type scam. Exactly what is the OP trying to figure out?

I've already stopped putting any funds in any Bitcoin service. It's obvious few of them have a clue how to secure their sites and there is no way to know who does and who doesn't.



Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 06:07:23 AM
I've already stopped putting any funds in any Bitcoin service. It's obvious few of them have a clue how to secure their sites and there is no way to know who does and who doesn't.
Wrong. There is a way to know. But it requires the code for the entire system, from front end to back end, to be published for public scrutiny. And not just the program code, but the server configs and software versions and everything. In fact, it should be possible for the entire file system of every server to be available via public, read-only, anonymous FTP — minus the one directory containing the private keys and the one directory that holds the database table containing the users' personal information, if such a table exists. There is no reason that the remainder of the systems' contents shouldn't be held out for the light of day to wash over them. Security through obscurity is no security at all. Cryptographic algorithms are secure despite their method of operation being public knowledge. The same should be true of web sites.


Title: Re: bitfloor needs your help!
Post by: Phinnaeus Gage on September 05, 2012, 06:57:42 AM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023

Roman recently had traveled or moved possibly out of the country (London ?). 

The address is USPS PO Box. Roman went for the conference to london?

Pardon me for adding this, but why is it that the last three major hacks involve the words genjix and conference? Just an observation that may, or may not, have relevance.

~Bruno~


Title: Re: bitfloor needs your help!
Post by: flower1024 on September 05, 2012, 06:59:59 AM
shtylman, where physically are you for service of process?
https://bitfloor.com/about

Quote
Mailing Address
Bitfloor Inc.
27-29 W 60th St. #21053
New York, NY 10023

Roman recently had traveled or moved possibly out of the country (London ?). 

The address is USPS PO Box. Roman went for the conference to london?

Pardon me for adding this, but why is it that the last three major hacks involve the words genjix and conference? Just an observation that may, or may not, have relevance.

~Bruno~


please use phantomcircuit for your accusations: much more fun and he deserved it


Title: Re: bitfloor needs your help!
Post by: thebaron on September 05, 2012, 07:31:27 AM
This is so exasperating. It's no wonder Bitcoin is becoming a laughing stock. It's simply not enough to claim the blockchain is safe when every service that people use ends up getting hacked and large sums being lost.

I guess it's sort of like the Pirate fiasco, people turned a blind eye to due diligence.

Make sure the bank has a vault before you deposit money in it. If they have nothing to show, your mattress may be a better storage medium.

Someone brought up a great point the other day: since lots of people here never really *earned* the money that their BTC is now worth, they tend to be very careless with where they put them.


Title: Re: bitfloor needs your help!
Post by: Phinnaeus Gage on September 05, 2012, 07:51:18 AM
If a bankruptcy is filed and you had $ or BTC at bitfloor, you should be included on the list of creditors, and you'll get periodic mailings about the progress of the matter.
Now we are getting to the really interesting stuff.  If BitFloor does not have any information on how to contact you, how will you get periodic mailings?

If some other legal action is filed, there's a pretty good chance you'll be included as a party, which would mean you'll get copies of filings,
See my question above.


BitFloor has no ID requirement for BTC withdrawals.

I'd just like to point out the importance of Bitfloor consulting an insolvency specialist and not a general lawyer.  You need someone who'll advise you on all of the legal options available and their pros and cons.

Enter Patrick Murck.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 05, 2012, 08:10:48 AM
Well sadly Stephen was misinformed and likely turned a bad situation into a worse one.  His talk of injunctions and criminal activity were simply false.  I am just not certain if it was coming from a place of intentional malfeasance or simple ignorance.

Here:

Quote
But once a corporation reaches insolvency, the fiduciary duties that once flowed to equity-holders divert instead to creditors. Again quoting the Delaware Supreme Court, "the corporation's insolvency makes the creditors the principal constituency injured by any fiduciary breaches that diminish the firm's value.

Quote
But once the moment of insolvency arrives, as the Delaware Court of Chancery has explained, "the creditors become the enforcement agents of fiduciary duties because the corporation's wallet cannot handle the legal obligations owed." The court continued: "Because, by contract, the creditors have the right to benefit from the firm's operations until they are fully repaid, it is they who have an interest in ensuring that the directors comply with their traditional fiduciary duties of loyalty and care."

 - http://www.faegrebd.com/8365

tl;dr: Things change when your organization becomes insolvent.

I am not a lawyer, but I'm aware that in the U.S., bad things can happen to you as an officer or director if you then take action after establishing insolvency that ends up further harming your creditors -- especially actions which might favor one creditor over another.  Now customer funds are even more sacrosanct.  My argument was that legal counsel should be obtained BEFORE paying out one single dime.

Roman had reopened the site to allow ACH withdrawals so I was making the argument that the only way to stop it was to get an injunction filed.

Personally, I don't have that many BTC involved and have already mentally booked mine as a total write off.  I could see though how Roman might be persuaded because releasing USDs to depositors would mean some people (those with USD balances) would be less pissed off -- though others (those with BTC balances), would be more pissed off.  But an insolvent organization no longer does what is best for the company or for its shareholders and instead is in dire need of legal advice before taking further action.

It looks like that might be what then happened.


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on September 05, 2012, 08:33:07 AM
Here's a chance for someone to buy part or all of BitFloor. Potential investors include other BTC exchanges, large mining pools, holders of large quantities of BTC and developers of bitcoin and bitcoin related products and services or an angel investor. BitFloor did have a lot of positive characteristics prior to this hack.


Title: Re: bitfloor needs your help!
Post by: davout on September 05, 2012, 08:39:32 AM
Here's a chance for someone to buy part or all of BitFloor. Potential investors include other BTC exchanges, large mining pools, holders of large quantities of BTC and developers of bitcoin and bitcoin related products and services or an angel investor. BitFloor did have a lot of positive characteristics prior to this hack.
I don't see an investor buying a business with such a low entry barrier, a quarter million dollar debt, and (AFAIK) no valuable partnerships or financial licenses.


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on September 05, 2012, 08:48:28 AM
Perhaps one of the large creditors that had a large amount of USD or BTC on BitFloor has some balls and wants to double down. Where's Matthew when you need him ;)


Title: Re: bitfloor needs your help!
Post by: ashleyconnor on September 05, 2012, 09:35:30 AM
Bit Flaw  ;D


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 10:13:14 AM
The story got picked up quickly by Arstechnica, C-Net et all.


Title: Re: bitfloor needs your help!
Post by: the_thing on September 05, 2012, 10:43:02 AM
The story got picked up quickly by Arstechnica, C-Net et all.
Bitcoins sold, let's wait for a FUD storm! I expect the price to hit <$8 in next few days.


Title: Re: bitfloor needs your help!
Post by: muyuu on September 05, 2012, 10:49:00 AM

Bitfloor Hacked, $250,000 Missing (bitcoinmagazine.net)
http://news.ycombinator.com/item?id=4477376

http://www.reddit.com/r/Bitcoin/comments/zchfn/bitfloor_hacked/

http://arstechnica.com/tech-policy/2012/09/hacker-steals-250k-in-bitcoins-from-online-exchange-bitfloor/


Title: Re: bitfloor needs your help!
Post by: bitbonga on September 05, 2012, 11:42:29 AM
The system was connected to from one of our other boxes which was accessed through a virtual console. The wallet box had all public ports blocked but was able to be connected to from a few of the other boxes.
Thanks for confirming.  This is why I prefer no incoming connections allowed on the secure box.  If you must have occasional ssh, you can have it enabled on boot and then login to disable it.  That way you can reboot first if you must login.

How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?


Title: Re: bitfloor needs your help!
Post by: JoelKatz on September 05, 2012, 12:00:57 PM
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?
IMO, the best solution is to walk a request to the box. You can also have the box connect out to a web server that provides it with transfer requests that then just have to be manually approved at the box. The most common transaction will be to move coins to the cold wallet, so all you need is an amount.


Title: Re: bitfloor needs your help!
Post by: vampire on September 05, 2012, 12:01:15 PM
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?

The secluded server will have a payment processor that will access the production database from behind a firewall, verify transactions for fraud and send the payments out.


Title: Re: bitfloor needs your help!
Post by: davout on September 05, 2012, 12:01:29 PM
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?
Polling another box? Connections allowed only from select IPs?


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 12:17:27 PM
. . . The wallet box had all public ports blocked but was able to be connected to from a few of the other boxes.
. . . This is why I prefer no incoming connections allowed on the secure box . . .
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?
I'm no expert on security matters and am not familiar with what the current best practices are in such a matter, so there are probably better solutions than the one I'm about to explain.  Regardless, as a system architect, it only took me a few seconds to come up with one possible solution to your question:

While nothing should be allowed to connect in to the wallet box, processes on the wallet box can still reach out to other boxes.

A separate daemon can be written to run on the wallet box and reach out regularly (every second?) to a database held on some other box.  Entries in this database can indicate actions that should be taken on the hot wallet (procedure numbers to indicate which function to run, additional columns or tables to hold parameters).  The daemon can be written to validate the database entries against a set of sanity checks (size, frequency, destination, etc). It can then trigger an alert (pager, txt msg, phone call) to system administrators and refuse to process the request from the database when any transaction, or set of transactions, exceeds any sanity check.  System administrators can then determine if the attempted interaction with the hot wallet is legitimate and handle the situation as needed. If the private keys for the hot wallet are known to be kept offline in cold storage, the daemon can even shut down bitcoind and delete the local copy of wallet.dat when it detects any obvious sign of intrusion.


Title: Re: bitfloor needs your help!
Post by: Vladimir on September 05, 2012, 12:23:13 PM
A separate daemon can be written to run on the wallet box and reach out regularly (every second?) to a database held on some other box.  Entries in this database can indicate actions that should be taken on the hot wallet (procedure numbers to indicate which function to run, additional columns or tables to hold parameters).  The daemon can be written to validate the database entries against a set of sanity checks (size, frequency, destination, etc). It can then trigger an alert (pager, txt msg, phone call) to system administrators and refuse to process the request from the database when any transaction, or set of transactions, exceeds any sanity check.  System administrators can then determine if the attempted interaction with the hot wallet is legitimate and handle the situation as needed. If the private keys for the hot wallet are known to be kept offline in cold storage, the daemon can even shut down bitcoind and delete the local copy of wallet.dat when it detects any obvious sign of intrusion.

Yep, this is a no brainer.



Title: Re: bitfloor needs your help!
Post by: marcus_of_augustus on September 05, 2012, 12:25:34 PM
Sheesh ... 25K unencrypted keys lying around at an exchange ... really??

I'm sure they were doing all the right AML/KYC fiat protection racket crap though ... it does make one wonder if any of these exchanges have actually been set-up intentionally to fail?

Maybe time for another Goxing?


Title: Re: bitfloor needs your help!
Post by: muyuu on September 05, 2012, 12:40:52 PM
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?
IMO, the best solution is to walk a request to the box. You can also have the box connect out to a web server that provides it with transfer requests that then just have to be manually approved at the box. The most common transaction will be to move coins to the cold wallet, so all you need is an amount.

IMO the best solution is this: https://bitcointalk.org/index.php?topic=92496.0 (Armory on web servers)

Plus an offline wallet to store the bulk of the reserves, not in any actual running computer connected to anything. http://bitcoinarmory.com/index.php/using-offline-wallets-in-armory

If etothepi could commit to Bitfloor I'd be all over the IPO with a 100K+ valuation.


Title: Re: bitfloor needs your help!
Post by: bitbonga on September 05, 2012, 12:46:09 PM
How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?

IMO, the best solution is to walk a request to the box. You can also have the box connect out to a web server that provides it with transfer requests that then just have to be manually approved at the box. The most common transaction will be to move coins to the cold wallet, so all you need is an amount.

The secluded server will have a payment processor that will access the production database from behind a firewall, verify transactions for fraud and send the payments out.

Polling another box? Connections allowed only from select IPs?

While nothing should be allowed to connect in to the wallet box, processes on the wallet box can still reach out to other boxes.


Thanks for the replies.

I guess most newly incoming bitcoins can go straight to the cold wallet and have the exchange run on a manually updated hot wallet.

It's more the hot wallet I'm trying to understand. It is needed for the exchange to instantly process transactions directed by customers. So there'll always be a kind of command path going from website to wallet, no matter how far away you hide the hot wallet, and we'll have to trust that path we setup ourselves. A good hacker will find that path and command the bitcoind. So there's actually no need to trust our path if we can't trust our website.

Now, of course you can have the hot wallet pull for commands and transactions, but then.. how do you trust the content of those commands and transactions? Because, basically, that is that same public website with input from customers.

If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?


Title: Re: bitfloor needs your help!
Post by: JoelKatz on September 05, 2012, 01:01:30 PM
I guess most newly incoming bitcoins can go straight to the cold wallet and have the exchange run on a manually updated hot wallet.
That's correct. There are serious risks if you don't have incoming bitcoins go directly to the cold wallet.

For example, recently an exchange was hacked with a bogus LR transfer. The hackers bought up Bitcoins and pushed the price up to some absurd amount. This encouraged people to deposit more Bitcoins in their accounts to sell them at the bogus rate. If deposits had gone to the hot wallet, these deposits could have been stolen as well.

Quote
It's more the hot wallet I'm trying to understand. It is needed for the exchange to instantly process transactions directed by customers. So there'll always be a kind of command path going from website to wallet, no matter how far away you hide the hot wallet, and we'll have to trust that path we setup ourselves. A good hacker will find that path and command the bitcoind. So there's actually no need to trust our path if we can't trust our website.
Right, that's why you don't keep that much money in the hot wallet. A starting point is your average one-day volume.

Quote
Now, of course you can have the hot wallet pull for commands and transactions, but then.. how do you trust the content of those commands and transactions? Because, basically, that is that same public website with input from customers.
You can't. That's the point of the hot wallet. It holds the coins you can afford to lose if you're hacked.

Quote
If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?
You can't, that's why you don't keep a lot of money in the hot wallet.

To be clear, you do make the hot wallet as secure as you can. But the risks you mention above are fundamental and they are the reason having a cold wallet is essential. If an account is holding more than about $100,000, the keys to that account should never appear on any one machine that provides remote access from the Internet.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 05, 2012, 01:04:12 PM
If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?

Well no security system is absolutely foolproof.  Even a 100% cold wallet can be compromised by physically attacking the cold wallet and/or operator.  The idea is to make the attack harder.

The hot wallet can validate commands internally.  For example it could limit the tx based on:
a) limit per hour
b) max limit until supervisor reset
c) limit per tx/address
d) limited to only preset withdraw addresses (adhoc address may be allowed but at lower limit)

If the attacker can't steal the keys directly, and must send commands to the hot wallet indirectly the attack becomes more difficult and the amount limited.  It is possible the attacker doesn't know that a withdraw request of 6,000 BTC will trigger a lockout and in doing so prevents him from stealing anything.   Combine that with sending all incoming funds to a cold wallet and only keeping say 10% of total funds in hot wallet and the potential theft becomes even more limited.

Even simply limiting the size of the hot wallet to say 10% of total funds and doing nothing else would have limited the attack to ~$20,000.  That is a bad breech but far easier to overcome than a complete loss of funds.


Title: Re: bitfloor needs your help!
Post by: justusranvier on September 05, 2012, 01:07:01 PM
If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?
You never fully can trust it, but you can make it more difficult for an attacker by having the hot wallet independently check the incoming commands for deviations from normal patterns which could indicate the website has been compromised.

At the cost of requiring more manual human action you can add more safeguards, like requiring customers to pre-register their withdrawal addresses and transferring a list of valid addresses via sneakernet to the hot wallet every 8 hours. Now an attacker can't break into the website and send the hot wallet a command to withdraw all the bitcoins to some arbitrary address because that address won't be on the authorized list.


Title: Re: bitfloor needs your help!
Post by: epetroel on September 05, 2012, 01:08:28 PM
A separate daemon can be written to run on the wallet box and reach out regularly (every second?) to a database held on some other box.  Entries in this database can indicate actions that should be taken on the hot wallet (procedure numbers to indicate which function to run, additional columns or tables to hold parameters).  The daemon can be written to validate the database entries against a set of sanity checks (size, frequency, destination, etc). It can then trigger an alert (pager, txt msg, phone call) to system administrators and refuse to process the request from the database when any transaction, or set of transactions, exceeds any sanity check.  System administrators can then determine if the attempted interaction with the hot wallet is legitimate and handle the situation as needed. If the private keys for the hot wallet are known to be kept offline in cold storage, the daemon can even shut down bitcoind and delete the local copy of wallet.dat when it detects any obvious sign of intrusion.

Yep, this is a no brainer.



I've been thinking about a similar method as part of the code for an exchange I'm working on, and it's almost correct other than if somebody has access to your database and knows your rules, they can insert or alter records in the database table that controls your payment processing service.  The solution here would be to have the requests (database records) be nonced & signed.  Preferably with both a server/application private key and a per-user private key derived from the users password.


Title: Re: bitfloor needs your help!
Post by: BkkCoins on September 05, 2012, 01:09:30 PM
If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?

You could enforce some simple rules. Such as require payments into the exchange be made by an "owned" address such that withdrawls will only go back to the same address. And then check any btc withdraw against separate account balances such that people cannot withdraw more than they have on account. And then there is always that thing that Paypal and most other money handlers do - delay xfers for a few days giving time for reconciliation and verification. Given the track record of exchanges allowing instant withdraws I'd think users would be ready to put up with some delay.

But all of this is moot if you keep an unencrypted backup copy of keys anywhere even remotely possible to reach - which makes this yet another fiasco.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 05, 2012, 01:14:16 PM
. . .How do you trust the content of those commands and transactions? Because, basically, that is that same public website with input from customers.

If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?
You can't eliminate your risk 100% and still have a functional usable interface, but you can drastically limit your risk.  If you put sanity checks into the daemon that runs on the box that does the polling, you can limit the size of any single transaction, you can limit the total amount of BTC that are transferred out over any time range, you can require authorization for certain transactions, and as I said earlier you can immediately shut down bitcoind, and the polling daemon as well as delete the wallet.dat in the event of anything that is identified as a theft attempt.  Without access to the code in this daemon, a hacker can't know what limits exist or what triggers will result in the system administrators being alerted to his efforts.  If the hacker unknowingly attempts a few really large transfers he will be stopped in his tracks.  If a hacker is more patient, he might be able to size his transactions to match the typical transaction of the service and keep the total number of transactions in line with typical traffic.  This might allow the hacker to get away with a few coins, but it will slow them way down limiting your exposure and allowing you time to identify the breach and respond.  I suspect that most users of most services would be willing to wait on human authorization and manual transfer of any large transaction if it means keeping their money safe in the first place.


Title: Re: bitfloor needs your help!
Post by: muyuu on September 05, 2012, 01:19:49 PM

Bitfloor Hacked, $250,000 Missing (bitcoinmagazine.net)
http://news.ycombinator.com/item?id=4477376

http://www.reddit.com/r/Bitcoin/comments/zchfn/bitfloor_hacked/

http://arstechnica.com/tech-policy/2012/09/hacker-steals-250k-in-bitcoins-from-online-exchange-bitfloor/

BBC as well: http://www.bbc.com/news/technology-19486695


Title: Re: bitfloor needs your help!
Post by: barbarousrelic on September 05, 2012, 01:23:54 PM
It's simply not believable that anyone involved enough with Bitcoin to make such a site, who has undoubtedly heard about all the other large-scale hacks, would simply leave an unencrypted wallet file worth a quarter mil lying around waiting to be hacked.

Right now, the owner should be desperately trying to convince us he didn't steal the money himself.

I have but a tiny percentage of the wealth of that wallet, and I am not smart enough to run such an exchange website, but I know enough to encrypt my fucking wallet .


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 05, 2012, 02:02:22 PM
The system was connected to from one of our other boxes which was accessed through a virtual console. The wallet box had all public ports blocked but was able to be connected to from a few of the other boxes.
Thanks for confirming.  This is why I prefer no incoming connections allowed on the secure box.  If you must have occasional ssh, you can have it enabled on boot and then login to disable it.  That way you can reboot first if you must login.

How do you solve getting to the secluded bitcoind to command it to sent bitcoins out?
You don't.  You have a process on the 'wallet server' that checks an external source and base it off of that.

In a 100% ideal security scenario you don't have ANY incoming connections.  That isn't 100% possible because bitcoind needs to get blocks so that has to be at least port 8333 open.  Also other ports were probably open as well for convenience, just firewalled to allow certain machines access.

EDIT:  Or what the other 100 people above me said (teach me to reply without reading the whole thread).


Title: Re: bitfloor needs your help!
Post by: Cluster2k on September 05, 2012, 03:01:08 PM
Interesting.  After we saw hacks and/or incompetent management from MtGox, Bitomat, Bitconica (x2), etc, exchanges are still getting hacked.  Probably best to leave matters to the professionals with 24/7 monitoring of both hardware and software involved in the project.

Anyone else running an exchange without 24/7 surveillance and independent auditing?  Best to own up now so users can proactively flee.


Title: Re: bitfloor needs your help!
Post by: peasant on September 05, 2012, 03:09:01 PM
It's a shame. I really liked this exchange. Lets see if the owner makes things right.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 05, 2012, 03:09:56 PM
Interesting.  After we saw hacks and/or incompetent management from MtGox, Bitomat, Bitconica (x2), etc, exchanges are still getting hacked.  Probably best to leave matters to the professionals with 24/7 monitoring of both hardware and software involved in the project.

Anyone else running an exchange without 24/7 surveillance and independent auditing?  Best to own up now so users can proactively flee.

Tangible Cryptography doesn't have 24/7 manned monitoring or independent auditing.  Then again we never accept sales we can't promptly pay and we hold all coins in an offline wallet which greatly reduces out attack surface.

The reality is setting the bar that high is probably useless.  Bitcoin simply isn't that big.  MtGox "maybe" meets your requirement.  All the hacks to date could have been prevented and/or reduced in scope with some more realistic standards.


Title: Re: bitfloor needs your help!
Post by: sd on September 05, 2012, 03:12:35 PM
Interesting.  After we saw hacks and/or incompetent management from MtGox, Bitomat, Bitconica (x2), etc, exchanges are still getting hacked.  Probably best to leave matters to the professionals with 24/7 monitoring of both hardware and software involved in the project.

This is exactly right. Banking website have to comply with countless rules and regulations. BitCoin websites are setup by people with no practical experience of building secure sites and those people always miss things.



Title: Re: bitfloor needs your help!
Post by: bg002h on September 05, 2012, 03:18:40 PM
the stupid feature of exchanges are instant withdrawals....why not keep everything in cold wallets and process btc withdrawls once a day...manually...


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 05, 2012, 03:24:05 PM
the stupid feature of exchanges are instant withdrawals....why not keep everything in cold wallets and process btc withdrawls once a day...manually...
That's kind of what I was thinking... I'd much rather have secured funds at this point than the ability to instantly withdraw them.


Title: Re: bitfloor needs your help!
Post by: padrino on September 05, 2012, 03:25:00 PM
Interesting.  After we saw hacks and/or incompetent management from MtGox, Bitomat, Bitconica (x2), etc, exchanges are still getting hacked.  Probably best to leave matters to the professionals with 24/7 monitoring of both hardware and software involved in the project.

This is exactly right. Banking website have to comply with countless rules and regulations. BitCoin websites are setup by people with no practical experience of building secure sites and those people always miss things.



What's interesting is how all of these activities tend to drive the community toward the kinds of rules and regulations that many tend to despise.. I know the answer will be that "we can do it better" but ultimately I think it will drive down the same path because the community as a whole isn't much different, ultimately purists aren't driving the value of bitcoins, the same types that play in other financial markets are.


Title: Re: bitfloor needs your help!
Post by: Kris on September 05, 2012, 03:30:07 PM
 :-\


Title: Re: bitfloor needs your help!
Post by: giszmo on September 05, 2012, 03:40:54 PM
If ever I'm putting any service public (I have a Facebook wallet), I will have my cold storage on an air gaped computer and not hold more in hot storage than I can afford to loose as I would get hacked like all the others. If that service doesn't make money to hire people to charge the hot wallet, this would mean the service might perform much worse when I'm on vacation but I would never loose money to a hacker exceeding what I can afford to loose.

(Ok, if the hacker manages to send out payments that look legit over an extended period of time without my users reporting anything, this could kill me but so far, all hacks went in one go and frankly I can't believe all these stories of being hacked.)


Title: Re: bitfloor needs your help!
Post by: drrussellshane on September 05, 2012, 03:44:35 PM
It's simply not believable that anyone involved enough with Bitcoin to make such a site, who has undoubtedly heard about all the other large-scale hacks, would simply leave an unencrypted wallet file worth a quarter mil lying around waiting to be hacked.

Right now, the owner should be desperately trying to convince us he didn't steal the money himself.

I have but a tiny percentage of the wealth of that wallet, and I am not smart enough to run such an exchange website, but I know enough to encrypt my fucking wallet .

I like Roman and Bitfloor, but I agree with barbarousrelic.


Title: Re: bitfloor needs your help!
Post by: Phinnaeus Gage on September 05, 2012, 03:48:42 PM
I go to the site and it reads this (which it still reads)

Bitfloor Website
Is currently offline.
It will be back shortly.
I check back later and its up. So I sent 136 coin to my deposit address.
Anyone else think the message on the site should read
DO NOT SEND ANY COIN TO US WE HAVE BEEN HACKED!!!!!
or something of that nature. I only keep my money in coin for less than 24 hours before converting it and got screwed. Guess I stop taking bitcoin cause its too risky.

Speaking like a true Junior.

Imagine how Bitfloor feels right now.

Speaking of Junior League: looking through Google's cache of bitfloor, and maybe I'm just missing something obvious here, but I don't see TOS at all. Did bitfloor users agree to a specific TOS via email, or some form of messaging, or… what?

This is the closest I could find: http://webcache.googleusercontent.com/search?q=cache:sm6wAI8jZJYJ:https://bitfloor.com/docs/+&cd=1&hl=en&ct=clnk&gl=us

Somebody else may desire to copy and paste what's available.

~Bruno~


Title: Re: bitfloor needs your help!
Post by: Rassah on September 05, 2012, 03:52:41 PM
I don't think selling ownership of the company is a good idea. Loans or bonds may be a better way to go. Running the numbers, to borrow $260k for 15 years at 5% interest will cost $2,056 per month (extra $20k to get the infrastructure and security rebuilt). If Roman can't borrow that from a bank, it may be prudent to sell long-term bonds that pay out a dividends the sum of which equal to that monthly amount. Now, in bitcoinworld, a paltry 5% a year dividend may seem like crap, especially compared to 7% a week ponzis, AND there's a huge risk that this business may not survive for very long anyway (using personal bank accounts for deposits?), but the benefits are:

1) All the money needed to cover stolen BTC are raised immediately
2) Roman still takes a hit (punishment) by working for zero profit for a few months, until revenues exceed the dividend payouts.
3) Roman still retains ownership of the company, and has incentive in keeping it going, because
4) While the volume continues to grow, and Bitcoin continues to increase in value, the fixed ~$2,000 monthly payments remain the same, and become easier and easier to pay off, and once the business is established enough, Roman can start buying the bonds back early (though he may not have the incentive to do so).

Again, it's important to keep in mind that this business itself is risky, with plenty of competition and regulatory traps, and it's dealing with a risky currency, so 15 years (even with the hope that once Bitfloor revenues improve, it may turn into 2 to 5 years) may be hard for people to swallow. Especially since this is in computer years. We were using dial-up and Windows 95 15 years ago. Who knows where Bitcoin and our tech will be 15 years from now. But, if run well, a 5% a year bond is still a damn good investment in the real world.


Title: Re: bitfloor needs your help!
Post by: Rassah on September 05, 2012, 03:59:46 PM
Also, I trust MtGox because it was previously hacked, and was forced to review its security procedures. Someone new may not care until they got hurt badly. Should it come back, I would trust Bitfloor more than other new exchanges (assuming their security policies we're also publicly scrutinized), because, like MtGox, they were forced to learn from mistakes and the owner knows just now much stupid oversights can cost him.


Title: Re: bitfloor needs your help!
Post by: peasant on September 05, 2012, 04:04:35 PM
Interestingly, Mt.Gox is down also it seems.


Title: Re: bitfloor needs your help!
Post by: davecoin on September 05, 2012, 04:06:37 PM
Interestingly, Mt.Gox is down also it seems.

False.  Good one though.


Title: Re: bitfloor needs your help!
Post by: peasant on September 05, 2012, 04:07:58 PM
It was for at least an hour, but it started working right after i posted.  :D


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 05, 2012, 04:08:40 PM
Also, I trust MtGox because it was previously hacked, and was forced to review its security procedures. Someone new may not care until they got hurt badly. Should it come back, I would trust Bitfloor more than other new exchanges (assuming their security policies we're also publicly scrutinized), because, like MtGox, they were forced to learn from mistakes and the owner knows just now much stupid oversights can cost him.
+1 to this.  If Bitfloor comes back, I would trust it a lot more than any new exchange that might come to take its place, because I know Bitfloor has learned its lesson the hard way already, and hopefully won't have to learn it again.  A new guy will probably fall into the same "oh, it won't happen to ME" trap that Roman did.


Title: Re: bitfloor needs your help!
Post by: dreamwatcher on September 05, 2012, 04:28:13 PM
Also, I trust MtGox because it was previously hacked, and was forced to review its security procedures. Someone new may not care until they got hurt badly. Should it come back, I would trust Bitfloor more than other new exchanges (assuming their security policies we're also publicly scrutinized), because, like MtGox, they were forced to learn from mistakes and the owner knows just now much stupid oversights can cost him.



Do not forget about the LR hack that BTC-E went through in July. BTC-E covered all the users losses through a rollback and was up and running about a day later with most of the customers funds back in place.

I now trust them equally to  GOX and more than any of the others, but GOX can be so difficult and slow to withdrawal USD.

I had the unfortunate luck of transferring some 60 BTC to Bitfloor that I wanted to cash out the night Bitfloor got hacked...... :(







Title: Re: bitfloor needs your help!
Post by: mufa23 on September 05, 2012, 04:28:47 PM
Interestingly, Mt.Gox is down also it seems.

False.  Good one though.
I was having a lot of trouble with it last night. Very slow loading, sometimes would just time out. Works fine now.


Title: Re: bitfloor needs your help!
Post by: Rygon on September 05, 2012, 04:33:47 PM
Also, I trust MtGox because it was previously hacked, and was forced to review its security procedures. Someone new may not care until they got hurt badly. Should it come back, I would trust Bitfloor more than other new exchanges (assuming their security policies we're also publicly scrutinized), because, like MtGox, they were forced to learn from mistakes and the owner knows just now much stupid oversights can cost him.
+1 to this.  If Bitfloor comes back, I would trust it a lot more than any new exchange that might come to take its place, because I know Bitfloor has learned its lesson the hard way already, and hopefully won't have to learn it again.  A new guy will probably fall into the same "oh, it won't happen to ME" trap that Roman did.

Any bussiness that has to learn all the lessons the hard way instead of avoiding the mistakes of predecessors is going to have a tough time being competitive. That goes for life too.


Title: Re: bitfloor needs your help!
Post by: sd on September 05, 2012, 04:39:54 PM
+1 to this.  If Bitfloor comes back, I would trust it a lot more than any new exchange that might come to take its place, because I know Bitfloor has learned its lesson the hard way already, and hopefully won't have to learn it again.  A new guy will probably fall into the same "oh, it won't happen to ME" trap that Roman did.

Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.


Title: Re: bitfloor needs your help!
Post by: Rassah on September 05, 2012, 04:54:33 PM
+1 to this.  If Bitfloor comes back, I would trust it a lot more than any new exchange that might come to take its place, because I know Bitfloor has learned its lesson the hard way already, and hopefully won't have to learn it again.  A new guy will probably fall into the same "oh, it won't happen to ME" trap that Roman did.

Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.

If I understand what happened correctly, the issue was not as much security related as just a dumb, careless mistake. I.e. this may have happened even on a very well secured system (though not to this extent if cold storage was used). Having this happen to an operator instills some really healthy paranoia, and changes their operating procedures, i.e. the human factor of security. Despite MtGox having vastly improved their technical security, we still don't really know if they have standard procedures that everyone must follow, and if they might not accidentally copy a wallet someplace unsafe while upgrading as well.

I do understand your point though, and mine does seem counterintuitive.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 05, 2012, 04:56:03 PM
1) All the money needed to cover stolen BTC are raised immediately
Did you account for slippage in your calculation?  I have not ran the numbers but highly doubt that you could acquire that many coins all at once for one price point.


Title: Re: bitfloor needs your help!
Post by: JoelKatz on September 05, 2012, 05:01:35 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 05, 2012, 05:07:03 PM
+1 to this.  If Bitfloor comes back, I would trust it a lot more than any new exchange that might come to take its place, because I know Bitfloor has learned its lesson the hard way already, and hopefully won't have to learn it again.  A new guy will probably fall into the same "oh, it won't happen to ME" trap that Roman did.

Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.

No, I am saying I trust people more who have "learned their lesson" already vs people who haven't.  I trust someone who has been through the hell of losing $200k of customer funds more than someone who hasn't, because they're going to do everything in their power to make sure it doesn't happen again.  They will have better security practices, procedures, and knowledge the second time around.

Of course, that's not a statement that stands entirely on its own.  Obviously, I will do my own due diligence to make sure that they actually have implemented better security measures, and that I am satisfied with the way they have resolved the prior security breach, etc.

It's like riding a bike up a hill.  Some people may try to ride straight up the hill, but it is too steep to do it - they will fail.  Others will take the longer path that winds around the hill.  Now, I don't know who is taking the path and who is trying to ride straight up, but I know that if someone DOES try to ride straight up, and fails, they're unlikely to try it again.  Therefore, anyone who fails is more likely to take the longer path that winds around than anyone who hasn't failed yet.


Title: Re: bitfloor needs your help!
Post by: barbarousrelic on September 05, 2012, 05:21:25 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 05, 2012, 05:25:35 PM
No, I am saying I trust people more who have "learned their lesson" already vs people who haven't.  I trust someone who has been through the hell of losing $200k of customer funds more than someone who hasn't, because they're going to do everything in their power to make sure it doesn't happen again.  They will have better security practices, procedures, and knowledge the second time around.

There are two different qualities at issue here - the first is a person's diligence/competence, the second is their honesty.

A painful mistake is likely to help a person learn to be more diligent/careful in the future, because they do not want to experience the consequences again.

A painful mistake won't make a dishonest person into an honest person.

I don't know the man personally but my impression is that Roman is an honest person who was insufficiently diligent/competent in the operation of his business. His behavior post-event seems to be that of a person owning up to and trying to fix the error in the best way possible.


Title: Re: bitfloor needs your help!
Post by: LazyOtto on September 05, 2012, 05:32:27 PM
Well, my impression is just that the operator of Bitfloor is young and inexperienced. With age and wide experience, not just ten or twenty years of the same thing over and over, Murphy's Laws become entrenched. Just automatic habit.

And paranoia becomes a professional asset. :)

--

I do praise him for immediately coming forward / fessing up.
Most people's first inclination is usually to hide or attempt a cover-up.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 05, 2012, 05:37:37 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
Tis a valid point, but not everyone learns well secondhand.  Many people learn best by failure.  I don't think failure implies purposeful negligence in all cases.

No, I am saying I trust people more who have "learned their lesson" already vs people who haven't.  I trust someone who has been through the hell of losing $200k of customer funds more than someone who hasn't, because they're going to do everything in their power to make sure it doesn't happen again.  They will have better security practices, procedures, and knowledge the second time around.

There are two different qualities at issue here - the first is a person's diligence/competence, the second is their honesty.

A painful mistake is likely to help a person learn to be more diligent/careful in the future, because they do not want to experience the consequences again.

A painful mistake won't make a dishonest person into an honest person.

I don't know the man personally but my impression is that Roman is an honest person who was insufficiently diligent/competent in the operation of his business. His behavior post-event seems to be that of a person owning up to and trying to fix the error in the best way possible.
Absolutely agree.  I believe Roman to be honest, and I wasn't trying to say that I would trust a dishonest person more after they stole people's money.  I trust an honest person more if they make a mistake, own up to it, and learn from it.


Title: Re: bitfloor needs your help!
Post by: LazyOtto on September 05, 2012, 05:42:45 PM
And one more thought, the professional software industry knows very well how to avoid these types of failures.

There just isn't enough money / ROI involved here to make it worth applying full-scale software engineering practices.

--

And that goes well beyond just 'slinging code'. It gets into Project Management, Administration Practices, Policies and Procedures, etc.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 05:43:04 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
Bullshit. That's like saying that because a car wreck has happened before, every future car wreck points to "gross negligence or criminal intent."  

How Roman resolves the current situation can certainly lead to further confidence in him.


Title: Re: bitfloor needs your help!
Post by: barbarousrelic on September 05, 2012, 05:52:10 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
Bullshit. That's like saying that because a car wreck has happened before, every future car wreck points to "gross negligence or criminal intent."  

How Roman resolves the current situation can certainly lead to further confidence in him.
Holding unencrypted wallet files on online computers in a business where you know you are likely to be a target is either gross negligence or it's a fake story to cover criminal intent.

To extend your car analogy, if you had seen many of your friends die in car crashes from not wearing a seatbelt, and you drive without a seatbelt and allow your children to ride with you without a seatbelt, you are grossly negligent.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 05:55:27 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
Bullshit. That's like saying that because a car wreck has happened before, every future car wreck points to "gross negligence or criminal intent."  

How Roman resolves the current situation can certainly lead to further confidence in him.
Holding unencrypted wallet files on online computers in a business where you know you are likely to be a target is either gross negligence or it's a fake story to cover criminal intent.

To extend your car analogy, if you had seen many of your friends die in car crashes from not wearing a seatbelt, and you drive without a seatbelt and allow your children to ride with you without a seatbelt, you are grossly negligent.

You are working on very limited information and yet you're speaking in absolutes. Sounds like you're just here to bash him, or you love speaking in unsupported hyperbole.


Title: Re: bitfloor needs your help!
Post by: Rassah on September 05, 2012, 06:00:31 PM
You are working on very limited information and yet you're speaking in absolutes. Sounds like you're just here to bash him, or you love speaking in unsupported hyperbole.

Let them bash him. Frustrated people who lost money need an outlet for their anger, and Roman admittedly deserves the scolding  :P


Title: Re: bitfloor needs your help!
Post by: barbarousrelic on September 05, 2012, 06:00:52 PM
Sorry, but that's flawed reasoning. You are saying you trust people more because they have proved they are not trustworthy. By that reasoning you should trust bitcoinica with everything you have.
+1, unfortunately. My life experience suggests that people actually don't learn lessons and instead repeat prior behavior if they can get away with it. (This is not a personal judgment about any particular person.)
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
Bullshit. That's like saying that because a car wreck has happened before, every future car wreck points to "gross negligence or criminal intent."  

How Roman resolves the current situation can certainly lead to further confidence in him.
Holding unencrypted wallet files on online computers in a business where you know you are likely to be a target is either gross negligence or it's a fake story to cover criminal intent.

To extend your car analogy, if you had seen many of your friends die in car crashes from not wearing a seatbelt, and you drive without a seatbelt and allow your children to ride with you without a seatbelt, you are grossly negligent.

You are working on very limited information and yet you're speaking in absolutes. Sounds like you're just here to bash him, or you love speaking in unsupported hyperbole.

He admitted he had an unencrypted wallet file on an online computer.

There's no excuse for someone with fifty bitcoins to have that, let alone someone with twenty-five thousand, on a (relatively) high-profile website.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 05, 2012, 06:17:07 PM
He admitted he had an unencrypted wallet file on an online computer.

There's no excuse for someone with fifty bitcoins to have that, let alone someone with twenty-five thousand, on a (relatively) high-profile website.
He didn't have them "on a high-profile website." Thanks for proving my point.

Did he make a mistake? Sure. Hindsight is 20/20. Does this mistake equal "gross negligence?" It's possible, but you don't know.

Feel free to keep running your mouth, I'm sure it will help.


Title: Re: bitfloor needs your help!
Post by: bitcorn on September 05, 2012, 06:27:49 PM
It was glossed over earlier, but it would appear that bitfloor had no TOS as part of their operating practices. At least seemingly not accessible from their website. TOS would usually be incorporated into a greater contract for use, etc. I am curious if users had some form of contract or use agreement with bitfloor before using the service.

If not, how could this affect bitfloor and their customers moving forward?


Title: Re: bitfloor needs your help!
Post by: ObviousSock on September 05, 2012, 06:31:34 PM
The operators of Bitfloor should have learned their lesson from the hacks of all the other Bitcoin exchanges. That they did not points to either gross negligence or criminal intent, neither of which should instill confidence in anyone.
I don't think you understand the meaning of gross negligence.  I do not think that is the case here.

Holding unencrypted wallet files on online computers in a business where you know you are likely to be a target is either gross negligence or it's a fake story to cover criminal intent.
Except that this machine was semi airgapped, so roman had no reason to believe it would be broken into. 


Title: Re: bitfloor needs your help!
Post by: Domrada on September 05, 2012, 06:54:56 PM
Bitfloor, Inc. is a registered corporation, with the complete protection of limited liability. Roman could walk away from this. But I predict he will come through and make his account holders whole, anyway. Think I'm bonkers?

http://betsofbitco.in/item?id=635

-edit-

Update: Unfortunately they did not approve my statement. They said it was too vague, and I refused to let them change it. This is what I proposed:

"On or before Nov 1, 2012, Roman Shtylman will announce via bitcointalk.org or bitfloor.com that all of Bitfloor's accountholders have either been made whole (account balances as of the Sep 3 loss event fully funded and available), or voluntarily agreed to suitably satisfactory repayment arrangements."



Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 07:14:08 PM
http://betsofbitco.in/item?id=635
Bet has not yet been approved.


Title: Re: bitfloor needs your help!
Post by: repentance on September 05, 2012, 07:25:53 PM
Is this going to be yet another theft which doesn't get reported to the police?


Title: Re: bitfloor needs your help!
Post by: whitslack on September 05, 2012, 07:40:55 PM
Is this going to be yet another theft which doesn't get reported to the police?
"SAVE US, PO-PO!" Give me a break. The police aren't going to be able to do jack shit; Bitcoin was designed with anonymity and irreversibility as core features. And the police aren't going to care either, as Bitcoin is still seen as a fringe element. It's like how murders of homeless people and prostitutes largely go unprosecuted.

ADDENDUM: You can't have your cake and eat it too. If you want your money to be free from the State, then you can't go running to the State when things don't go your way.


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 05, 2012, 07:43:47 PM
Is this going to be yet another theft which doesn't get reported to the police?

yeah go run to the daddy/god/state

"oooh look, the bitcoin kiddies need their diapers changed again"


Title: Re: bitfloor needs your help!
Post by: LazyOtto on September 05, 2012, 08:10:56 PM
You can't have your cake and eat it too. If you want your money to be free from the State, then you can't go running to the State when things don't go your way.
+1


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 05, 2012, 10:30:58 PM
You can't have your cake and eat it too. If you want your money to be free from the State, then you can't go running to the State when things don't go your way.
Quoting just because I think it is important.


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 05, 2012, 10:51:10 PM
You can't have your cake and eat it too. If you want your money to be free from the State, then you can't go running to the State when things don't go your way.
Quoting just because I think it is important.

and as a life long libertarian, I'm going to go ahead and disagree with it. If a state needs to exist at all, it only purpose (edit: if anything else) should be to protect citizens against fraud and violence and resolve civil issues.


Title: Re: bitfloor needs your help!
Post by: Vod on September 05, 2012, 10:51:49 PM
No police report equals an inside job.


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 05, 2012, 10:54:27 PM
You can't have your cake and eat it too. If you want your money to be free from the State, then you can't go running to the State when things don't go your way.
Quoting just because I think it is important.

and as a life long libertarian, I'm going to go ahead and disagree with it. If a state needs to exist at all, it only purpose (edit: if anything else) should be to protect citizens against fraud and violence and resolve civil issues.

Exactly. I will point out there is a difference between peace officers and law enforcement officers.

http://freemanontheland.com/canadian-common-corps-of-peace-officers/ (http://freemanontheland.com/canadian-common-corps-of-peace-officers/)


Title: Re: bitfloor needs your help!
Post by: alans on September 05, 2012, 11:39:55 PM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted. 

I would assume that had he been the culprit these monies would also have disappeared.


Title: Re: bitfloor needs your help!
Post by: TangibleCryptography on September 05, 2012, 11:42:53 PM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted.  

I would assume that had he been the culprit these monies would also have disappeared.

Our pending ACHs also cleared today.  Not insignificant sums.
For what it is worth we have done a lot of business with Roman and honestly I just don't see him pulling any kind of scam or fake hack.


Title: Re: bitfloor needs your help!
Post by: JoelKatz on September 05, 2012, 11:54:14 PM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted. 

I would assume that had he been the culprit these monies would also have disappeared.
It's much more dangerous to steal USD than Bitcoins. Also, if it was Roman, how would he explain the missing USD? (Not that I'm saying Roman stole the coins, I'm just saying this reasoning is very flimsy.)


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 05, 2012, 11:57:50 PM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted. 

I would assume that had he been the culprit these monies would also have disappeared.
It's much more dangerous to steal USD than Bitcoins. Also, if it was Roman, how would he explain the missing USD? (Not that I'm saying Roman stole the coins, I'm just saying this reasoning is very flimsy.)


Beat me to it. Leave the usd alone. Authorities understand that easily. Not that i am saying he did it but so far i have not read how the hacker got in....


Title: Re: bitfloor needs your help!
Post by: adamstgBit on September 06, 2012, 12:14:14 AM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted. 

I would assume that had he been the culprit these monies would also have disappeared.
It's much more dangerous to steal USD than Bitcoins. Also, if it was Roman, how would he explain the missing USD? (Not that I'm saying Roman stole the coins, I'm just saying this reasoning is very flimsy.)


Beat me to it. Leave the usd alone. Authorities understand that easily. Not that i am saying he did it but so far i have not read how the hacker got in....

bitfloor was hosted by Lindon, need i say more?


Title: Re: bitfloor needs your help!
Post by: nimda on September 06, 2012, 12:20:57 AM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted. 

I would assume that had he been the culprit these monies would also have disappeared.
It's much more dangerous to steal USD than Bitcoins. Also, if it was Roman, how would he explain the missing USD? (Not that I'm saying Roman stole the coins, I'm just saying this reasoning is very flimsy.)


Beat me to it. Leave the usd alone. Authorities understand that easily. Not that i am saying he did it but so far i have not read how the hacker got in....

bitfloor was hosted by Lindon, need i say more?
Linode?


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 06, 2012, 12:59:28 AM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted.  

I would assume that had he been the culprit these monies would also have disappeared.
It's much more dangerous to steal USD than Bitcoins. Also, if it was Roman, how would he explain the missing USD? (Not that I'm saying Roman stole the coins, I'm just saying this reasoning is very flimsy.)


Beat me to it. Leave the usd alone. Authorities understand that easily. Not that i am saying he did it but so far i have not read how the hacker got in....

bitfloor was hosted by Lindon, need i say more?
Linode?

Yes, linode. But even they need a root passwd right? Thus a reset which happened to bitcoinica? Unless can read filesystem with no problems...


Title: Re: bitfloor needs your help!
Post by: ElectricMucus on September 06, 2012, 01:06:19 AM
No police report equals an inside job.
+1


Title: Re: bitfloor needs your help!
Post by: Cluster2k on September 06, 2012, 02:05:37 AM
Is this going to be yet another theft which doesn't get reported to the police?

yeah go run to the daddy/god/state

"oooh look, the bitcoin kiddies need their diapers changed again"

Sounds like stealing bitcoins IS the perfect crime.  Difficult to track the attacker, commodity is easily convertible into the currency of the attacker's choice, and the police (in every country) don't care.  If it's an inside job then even better.  Just declare the hax0rz got the goodies and close up shop.


Title: Re: bitfloor needs your help!
Post by: Yankee (BitInstant) on September 06, 2012, 02:26:34 AM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted.  

I would assume that had he been the culprit these monies would also have disappeared.

Our pending ACHs also cleared today.  Not insignificant sums.
For what it is worth we have done a lot of business with Roman and honestly I just don't see him pulling any kind of scam or fake hack.

I can +1 this.

I've met Roman many times, and lives/works not far from our NYC office.

I dont see him pulling any scams...but you never know!

-Charlie


Title: Re: bitfloor needs your help!
Post by: Rassah on September 06, 2012, 03:14:09 AM
Regarding reporting this to police, other than covering his butt and adding to their list of crimes, I just don't think police have the resources to track this theft down. If it's through an anonymous proxy, from Russia, and in a currency that's easily "mixed," there's really noting they can do. Not even sure the FBI would have the resources to track this down.


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 06, 2012, 03:31:46 AM
FYI - I had some ACH (USD) transactions from the weekend pending when bitfloor went down that *did* complete this afternoon.

As Roman promised these transactions were not stopped/interrupted.  

I would assume that had he been the culprit these monies would also have disappeared.

Our pending ACHs also cleared today.  Not insignificant sums.
For what it is worth we have done a lot of business with Roman and honestly I just don't see him pulling any kind of scam or fake hack.

I can +1 this.

I've met Roman many times, and lives/works not far from our NYC office.

I dont see him pulling any scams...but you never know!

-Charlie
I can say that funds I pulled on Sunday did show up as normal.  Funds I pulled Tuesday during that small window of time are on hold.  Wish I had pulled my coins too on Sunday.


Title: Re: bitfloor needs your help!
Post by: talktojer on September 06, 2012, 04:13:12 AM
Seems like you'd want to be insured.  Insurance Co likes police reports.  In general, having a police report isn't a bad idea.  It can't work against you.  If they will take a report, one should be filed.  Not to suggest they'll do anything about it, but at least there is a record that a crime occurred.

Is there any reason a police report should not be filed?


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 06, 2012, 04:36:05 AM
Is there any reason a police report should not be filed?

Those with USDs will likely get most / all of their funds back, so them filing a complaint with the police is not probably seen as being necessary.

Those with BTCs were there for a variety of reasons.  Some might have just been using BitFloor as a hosted (shared) EWallet  (there aren't many options for EWallets like BitFloor's which have one-time password protection and no fees)  Others had funds there for doing market timing trades, without ever intending to withdraw USDs.  They may not even be from the U.S.  Filing a complaint with the police would require providing identity, which is not always desirable.  Others had amounts too small to bother trying to recover by going to the police.

So that might explain why no customers might be filing a complaint.  As far as why the operator doesn't?  There's really no upside.  The coins are gone.  Nobody has ever been charged with a crime, even those holding customer's funds that didn't use cold storage. Also, BitFloor's operator is out of the country.

The Bitcoinica lawsuit is the first publicly known lawsuit regarding breach of contract, negligence, etc., and that hasn't been decided or settled yet so there's no great worry about covering your ass by filing a complaint with the police.

[Edit: There may be laws in BitFloor's jurisdiction that could require contacting the police or federal agency in cases of theft of customer funds, I've no idea]


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 06, 2012, 05:09:48 AM
As far as why the operator doesn't?  There's really no upside.  The coins are gone.  Nobody has ever been charged with a crime, even those holding customer's funds that didn't use cold storage. Also, BitFloor's operator is out of the country.

One upside would be potential identification or incapacitation of the criminals, even if the stolen funds cannot be recovered. This would be good for everyone but the criminals; it would be especially good for Roman because it would help address suspicions that this was an inside job.

On the other hand, if the operator of a business that has experienced the mysterious disappearance of other people's property decides not to involve law enforcement, I would certainly be more inclined to imagine they were complicit in the crime, or that they were afraid that investigation of the crime would reveal other misbehavior with serious consequences.

I am more sympathetic to the "it's the operator's choice" argument if the operator is in a position to make good the customer losses out of his own funds - but if his story for his customers is "I can't be bothered to cooperate with the police in tracking down the people who stole your stuff, also the loss of your stuff is not my problem, too bad for you!", well, that doesn't leave a very nice taste in anyone's mouth.

"It's too much trouble to talk to the police" sounds pretty hollow next to the loss of $250K of other people's money.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 06, 2012, 05:23:23 AM
"It's too much trouble to talk to the police" sounds pretty hollow next to the loss of $250K of other people's money.

Anyone owed even a single satoshi can file a complaint.   Has anyone?
/me listens to sound of crickets ...


Title: Re: bitfloor needs your help!
Post by: Rassah on September 06, 2012, 05:29:17 AM
"It's too much trouble to talk to the police" sounds pretty hollow next to the loss of $250K of other people's money.

Anyone owed even a single satoshi can file a complaint.   Has anyone?
/me listens to sound of crickets ...

Time not worth the $20USD I "lost."


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 06, 2012, 05:40:00 AM
"It's too much trouble to talk to the police" sounds pretty hollow next to the loss of $250K of other people's money.

Anyone owed even a single satoshi can file a complaint.   Has anyone?
/me listens to sound of crickets ...

Time not worth the $20USD I "lost."

Which is why it would make a lot of sense for the person(s) last entrusted with the funds before they were stolen to make the report, and cooperate with the investigation.

It's not going to look very good for Bitfloor if someone else (with a loss big enough to attract attention) makes the first report, and the Bitfloor operators were too busy with other projects to take care of business.

If this were a bike store, and there were a lot of customer bikes in the back room being worked on, and someone picked the lock to the back door and stole all of the customers' bikes, but the bike store owner just shrugged and said "oh, the police never do anything anyway, I'll let someone else call if they really care" then they don't seem like a very trustworthy merchant to me.

The lack of law enforcement involvement in the previous hacks didn't leave me with a very good impression of those exchange operators. Ignoring for a moment the possibility of inside jobs, it's possible that there's one guy/crew doing all of these hacks, and they're going to keep going until they're caught.


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 05:42:19 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 


Title: Re: bitfloor needs your help!
Post by: Rassah on September 06, 2012, 06:03:53 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?


Title: Re: bitfloor needs your help!
Post by: Keyur @ Camp BX on September 06, 2012, 06:16:47 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Interesting find!  Bruce's mailing list is awfully quiet about this hack.


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 06:17:10 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

I haven't read much of this thread -- do people think this Bitfloor guy didn't just rip them off?  It's just all the more funny if he's in cahoots with Bruce Pedo Wagner. 

Edit:  But yes, only the same P.O. Box Office.  Coincidence?  Eh...


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 06:40:25 AM
The only people profiting from bitcoin are hackers. Fuck this shit.

I haven't lost anything yet from bitcoin but it does seem like hackers are just having a field day with it.  As much as everyone hates Mt.Gox because of the cost to put money on there and the loss of anonymity, it seems like they have the best methods on there.  I feel like bit floor should have known better than to have all of their coins in a hot wallet after btc-e and other hacks.  

Exchanges are damned if they do and damned if they don't.  People want the convenience of being able to do instant withdrawals and transfers without any of the risk.

Small Bitcoin services which hold large amounts of other people's BTC are hacker magnets and intruders know that such services are often one or two man operations without capital reserves to invest in infrastructure.  They're soft targets.  Security needs to be baked in from the day a service is created but many Bitcoin services are more concerned about rushing to market than they are about security (they probably tell themselves they'll invest in "proper" security once the profits are rolling in, not realising that a rapidly expanding business often makes little or no profit).

Until Bitcoin service providers lift their game security-wise, people should severely limit the amount of BTC they store on such services.   Bitcoins stored on a service are always at risk.  You accept the risk of them being lost or stolen by leaving them on deposit with a service.

Take a look at Open Transactions and help us make it more accessible to people.

I notice this case is yet another Linode case, is there any reason to think there was any real vulnerability other than the fact of being hosted by a third party instead of being a server physically controlled by the operator of the service?

-MarkM-


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 06:44:07 AM

Sounds like the cold storage was deposited with pirate.
 

That was an obvious idea to jump to right off the bat but seemingly someone has traced some transaction(s) thought to possibly be the thief moving the coins, which would not really be possible if the coins had already been sent to pirate would it?

It is amazing though the clever ways people come up with of making their coins accessible to hackers.

-MarkM-


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 06, 2012, 06:50:01 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

I haven't read much of this thread -- do people think this Bitfloor guy didn't just rip them off?  It's just all the more funny if he's in cahoots with Bruce Pedo Wagner. 

Edit:  But yes, only the same P.O. Box Office.  Coincidence?  Eh...

Roman was on Bruce's show.


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 06:52:37 AM
I've already stopped putting any funds in any Bitcoin service. It's obvious few of them have a clue how to secure their sites and there is no way to know who does and who doesn't.
Wrong. There is a way to know. But it requires the code for the entire system, from front end to back end, to be published for public scrutiny. And not just the program code, but the server configs and software versions and everything. In fact, it should be possible for the entire file system of every server to be available via public, read-only, anonymous FTP — minus the one directory containing the private keys and the one directory that holds the database table containing the users' personal information, if such a table exists. There is no reason that the remainder of the systems' contents shouldn't be held out for the light of day to wash over them. Security through obscurity is no security at all. Cryptographic algorithms are secure despite their method of operation being public knowledge. The same should be true of web sites.

Please come help us get Open Transactions polished up...

-MarkM-


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 06, 2012, 06:56:34 AM

Sounds like the cold storage was deposited with pirate.
 

That was an obvious idea to jump to right off the bat but seemingly someone has traced some transaction(s) thought to possibly be the thief moving the coins, which would not really be possible if the coins had already been sent to pirate would it?

It is amazing though the clever ways people come up with of making their coins accessible to hackers.

-MarkM-


http://i.imgur.com/s4IKe.png


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 06:58:30 AM
Well sadly Stephen was misinformed and likely turned a bad situation into a worse one.  His talk of injunctions and criminal activity were simply false.  I am just not certain if it was coming from a place of intentional malfeasance or simple ignorance.

Here:

Quote
But once a corporation reaches insolvency, the fiduciary duties that once flowed to equity-holders divert instead to creditors. Again quoting the Delaware Supreme Court, "the corporation's insolvency makes the creditors the principal constituency injured by any fiduciary breaches that diminish the firm's value.

Quote
But once the moment of insolvency arrives, as the Delaware Court of Chancery has explained, "the creditors become the enforcement agents of fiduciary duties because the corporation's wallet cannot handle the legal obligations owed." The court continued: "Because, by contract, the creditors have the right to benefit from the firm's operations until they are fully repaid, it is they who have an interest in ensuring that the directors comply with their traditional fiduciary duties of loyalty and care."

 - http://www.faegrebd.com/8365

tl;dr: Things change when your organization becomes insolvent.

I am not a lawyer, but I'm aware that in the U.S., bad things can happen to you as an officer or director if you then take action after establishing insolvency that ends up further harming your creditors -- especially actions which might favor one creditor over another.  Now customer funds are even more sacrosanct.  My argument was that legal counsel should be obtained BEFORE paying out one single dime.

Roman had reopened the site to allow ACH withdrawals so I was making the argument that the only way to stop it was to get an injunction filed.

Personally, I don't have that many BTC involved and have already mentally booked mine as a total write off.  I could see though how Roman might be persuaded because releasing USDs to depositors would mean some people (those with USD balances) would be less pissed off -- though others (those with BTC balances), would be more pissed off.  But an insolvent organization no longer does what is best for the company or for its shareholders and instead is in dire need of legal advice before taking further action.

It looks like that might be what then happened.

I hope to cover this stuff for my Open Transactions server by taking the position that although the tokens representing assets are intended to do so in a non fractional reserve manner, nonetheless the actions of theives, acts of god, force majeur etc could contrive to force some of those tokens into being fractional (or even zero) reserve; but that each type of token is independent such that loss of dollars to back dollar tokens would cause only those tokens into being less thasn full reserve, whereas tokens representing assets not lost would remain fully backed.

Not sure how long it would take though for the system to earn itself enough moneu to have that cast into legally airtight form...

-MarkM-


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 06:59:08 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

I haven't read much of this thread -- do people think this Bitfloor guy didn't just rip them off?  It's just all the more funny if he's in cahoots with Bruce Pedo Wagner. 

Edit:  But yes, only the same P.O. Box Office.  Coincidence?  Eh...

Also, it's probably completely random, and it's nothing that I know about anyways, but both Bitfloor and Bruce Wagner's multiple phone numbers are in the same prefix (646-580-XXXX), which is run by a small company, BandWidth.com.  There are hundreds of prefixes for the 646 area code, and Bandwidth owns 17 . . . kinda coincidental that Bruce and Bitfloor not only use the same post office for their P.O. box, but also use the same telcomm and apparently set up their plans around the same time (assuming that's why the company gave them numbers within the same prefix).  It's like they're in cahoots or something.  


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 07:02:48 AM
Quote
Roman was on Bruce's show.

It's kinda clever to advertise and talk up the business before cashing it out.  With his cut, maybe Bruce can finally send the poor guy his $951 in BTC from that other thread now. 


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 07:05:51 AM
It's more the hot wallet I'm trying to understand. It is needed for the exchange to instantly process transactions directed by customers. So there'll always be a kind of command path going from website to wallet, no matter how far away you hide the hot wallet, and we'll have to trust that path we setup ourselves. A good hacker will find that path and command the bitcoind. So there's actually no need to trust our path if we can't trust our website.

Now, of course you can have the hot wallet pull for commands and transactions, but then.. how do you trust the content of those commands and transactions? Because, basically, that is that same public website with input from customers.

If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?

The route I am going is to have the customers sign everything using their own private keys.

If a hacker uses their private keys unauthorised that will be totally outside my control and I will have no way even to distinguish between a hacker and the actual customer, since to me the private key is the customer.

This seems nice and safe from my end as service, but admittedly is not going to be very nice for people who let hackers get hold of their private keys.

-MarkM-


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 07:12:29 AM
If we can't trust the website giving commands into the hot wallet, [edited:]how can we trust that same website to collect and offer the hot wallet valid and intended commands to pull?
You never fully can trust it, but you can make it more difficult for an attacker by having the hot wallet independently check the incoming commands for deviations from normal patterns which could indicate the website has been compromised.

At the cost of requiring more manual human action you can add more safeguards, like requiring customers to pre-register their withdrawal addresses and transferring a list of valid addresses via sneakernet to the hot wallet every 8 hours. Now an attacker can't break into the website and send the hot wallet a command to withdraw all the bitcoins to some arbitrary address because that address won't be on the authorized list.

I am not really convinced that you cannot set up the system to be trustable.

For example if I base sending out of bitcoins on my having received bitcoin-tokens in a certain account, then it looks to me as if the only way I can get those tokens arriving in my account (and thus triggering a send-out-coins request) is if the hacker has the private keys of a user who has bitcoin-tokens. Those tokens in turn could only have arrived there through a properly signed transaction, and the signatures go all the way back to the account that actually issues the tokens. The whole point of all this signing is so the server does not actually have to be trusted...

-MarkM-


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 07:14:19 AM
I've been thinking about a similar method as part of the code for an exchange I'm working on, and it's almost correct other than if somebody has access to your database and knows your rules, they can insert or alter records in the database table that controls your payment processing service.  The solution here would be to have the requests (database records) be nonced & signed.  Preferably with both a server/application private key and a per-user private key derived from the users password.

Please look at Open Transactions system and maybe come help us get it widely deployed...

-MarkM-


Title: Re: bitfloor needs your help!
Post by: Shagnasty on September 06, 2012, 08:04:27 AM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.


Title: Re: bitfloor needs your help!
Post by: ErnestoJuarell on September 06, 2012, 10:00:49 AM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

I haven't read much of this thread -- do people think this Bitfloor guy didn't just rip them off?  It's just all the more funny if he's in cahoots with Bruce Pedo Wagner. 

Edit:  But yes, only the same P.O. Box Office.  Coincidence?  Eh...

Also, it's probably completely random, and it's nothing that I know about anyways, but both Bitfloor and Bruce Wagner's multiple phone numbers are in the same prefix (646-580-XXXX), which is run by a small company, BandWidth.com.  There are hundreds of prefixes for the 646 area code, and Bandwidth owns 17 . . . kinda coincidental that Bruce and Bitfloor not only use the same post office for their P.O. box, but also use the same telcomm and apparently set up their plans around the same time (assuming that's why the company gave them numbers within the same prefix).  It's like they're in cahoots or something.  
It could be a "virtual office" (http://www.virtualoffice.com/landing.php).


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 06, 2012, 10:09:10 AM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.

That (offline wallet) is one of the requests on the Raspberry Pi thread:

 - http://bitcointalk.org/index.php?topic=93724.msg1155722#msg1155722


Title: Re: bitfloor needs your help!
Post by: Domrada on September 06, 2012, 12:17:41 PM
I've been thinking about a similar method as part of the code for an exchange I'm working on, and it's almost correct other than if somebody has access to your database and knows your rules, they can insert or alter records in the database table that controls your payment processing service.  The solution here would be to have the requests (database records) be nonced & signed.  Preferably with both a server/application private key and a per-user private key derived from the users password.

Please look at Open Transactions system and maybe come help us get it widely deployed...

-MarkM-


I've been watching the #opentransactions channel and it looks like FT & co. are still working out the bugs. Are you sure it's stable enough to "widely deploy"?


Title: Re: bitfloor needs your help!
Post by: Phinnaeus Gage on September 06, 2012, 02:01:10 PM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

Nah! Two different box numbers at the same address by two Bitcoiners of which one interviewed the other one on a show that was sponsored by another Bitcoiner. Nothing further to see here.

~Bruno~


Title: Re: bitfloor needs your help!
Post by: Rassah on September 06, 2012, 02:13:16 PM

I think a more accurate picture would be the same diagram, but with text reading People who know math, People who know currency, and People who know investing, and with a third of a Bitcoin at the very far tip of each circle, as far away from the center as possible (so, 3 separate pieces of a Bitcoin), and the middle section should just have text saying "NOBODY, Except maybe Satoshi"


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 06, 2012, 02:15:50 PM
ha!

http://webcache.googleusercontent.com/search?q=cache:UYt4pj002acJ:https://bitfloor.com/about+&cd=1&hl=en&ct=clnk&gl=us

http://buybitcoin.com/home/contact/

Too funny. 

Same P. O. Box office?

Nah! Two different box numbers at the same address by two Bitcoiners of which one interviewed the other one on a show that was sponsored by another Bitcoiner. Nothing further to see here.

~Bruno~

Charlie's also been on the show. He is also located close to Bruce. Are you going to say BitInstant also deserves to share whatever shady reputation Bruce has?
Give me a fucking break. They're in NYC and they're involved in Bitcoin. The fact that they're in the same area of a densely populated city doesn't equate to conspiracy.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 06, 2012, 02:51:12 PM
+1 to jwzguy.

IIRC Roman even posted a while back that he went on the show because Bruce lived in the same neighborhood.  Utterly bizarre people from the same neighborhood might use the same Post Office.

DUN DUN DUUUUNNNNN


Title: Re: bitfloor needs your help!
Post by: bg002h on September 06, 2012, 02:55:21 PM
anyone notice the title of the thread? I don't see many responses to the plea for help...That said, just because we want Bitcoin to be decentralized and all that jazz, it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.


Title: Re: bitfloor needs your help!
Post by: LazyOtto on September 06, 2012, 03:01:41 PM
it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.
It doesn't mean he shouldn't get law enforcement involved.

It does seem to fall within one or another of the USA 'computer abuse' laws.

However, if all the existing USD in accounts as of time of hack are honored, I don't see it as a fiscal / monetary issue.

At this point, bitcoins are not "money".


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 06, 2012, 03:18:40 PM
it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.
It doesn't mean he shouldn't get law enforcement involved.

It does seem to fall within one or another of the USA 'computer abuse' laws.

However, if all the existing USD in accounts as of time of hack are honored, I don't see it as a fiscal / monetary issue.

At this point, bitcoins are not "money".
But they are something of value, which means those who held a Bitcoin balance at the exchange have a valid claim to the remaining assets of the company in the event in a liquidation.


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 03:20:49 PM
+1 to jwzguy.

Utterly bizarre people from the same neighborhood might use the same Post Office.



And use the same small telcomm company.  And set up their telcomm plans around the same time.  And pulled a big ol' scam.  Nope, nothing to see here.  Bitfloor definitely just got hacked; no need to believe that a bitcoin operator worked with the "Most famous man (and pedo) in bitcoin" to run off with $200k.  


Title: Re: bitfloor needs your help!
Post by: markm on September 06, 2012, 04:04:25 PM
I've been watching the #opentransactions channel and it looks like FT & co. are still working out the bugs. Are you sure it's stable enough to "widely deploy"?

All balances have been kept perfectly. I don't think I've actually seen that before, its amazing to me with all we've been through. Seems to me over the decades I got used to financial software always screwing up balances here and there so correcting entries of some sort always ended up being needed. So to me it is amazingly robust. Forcing every change of any balance to have to be signed off on seems to be a very good system.

That said, I want first off lots and lots of test clients deployed so more and more people can test it... The recent bugs have been to do with scaling up; I have been doing load testing, in effect, running lots of scripts automatically placing lots of offers in the markets and, it turned out, mostly without downloading the outcomes thus letting people's account-inboxes grow huge, running into limits of string buffers. So basically, testing to destruction, driving the thing to its limits, yet still all balances remain correct.

-MarkM-


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 06, 2012, 04:12:49 PM
anyone notice the title of the thread? I don't see many responses to the plea for help...That said, just because we want Bitcoin to be decentralized and all that jazz, it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.

Excellent point. Bitfloor  has been very good to it's customers. Lowest fees, very easy to use, excellent (and personalized) customer service. No shady "account locking." No information extortion.

How can we help?
1) If you have funds there, be patient. We gave gox forever and a day, and they were making WAY more than Bitfloor. (quadruple the fees on a 10x-100x the volume)
2) Offer to invest in Bitfloor.

Roman, if you're reading this: This thread is clearly not the place to discuss it, but if you're willing to accept investment, that seems like the best way your user base can help you recover ASAP.

I'm not a big enough player to make much of a dent, but I would be willing to invest. It seems like you should start some kind of discussion on going forward with this, if you're considering it.

I also think you should let your accountholders with USD withdraw immediately before any other steps are taken.

Best wishes.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 06, 2012, 04:15:38 PM
+1 to jwzguy.

Utterly bizarre people from the same neighborhood might use the same Post Office.



And use the same small telcomm company.  And set up their telcomm plans around the same time.  And pulled a big ol' scam.  Nope, nothing to see here.  Bitfloor definitely just got hacked; no need to believe that a bitcoin operator worked with the "Most famous man (and pedo) in bitcoin" to run off with $200k.  
And both ate food. And breathed air. And wore pants. Any other nonsensical bullshit you want to throw out there?


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 04:33:14 PM
Quote
And both ate food. And breathed air. And wore pants. Any other nonsensical bullshit you want to throw out there?

Man, when you're in such denial, you really deserve to be scammed (and scammed, and scammed, and scammed . . . bitcoin!). 


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 04:36:54 PM
Quote

Excellent point. Bitfloor  has been very good to it's customers. Lowest fees, very easy to use, excellent (and personalized) customer service. No shady "account locking." No information extortion.

How can we help?
1) If you have funds there, be patient. We gave gox forever and a day, and they were making WAY more than Bitfloor. (quadruple the fees on a 10x-100x the volume)
2) Offer to invest in Bitfloor.

Roman, if you're reading this: This thread is clearly not the place to discuss it, but if you're willing to accept investment, that seems like the best way your user base can help you recover ASAP.

I'm not a big enough player to make much of a dent, but I would be willing to invest. It seems like you should start some kind of discussion on going forward with this, if you're considering it.



So a guy with shady connections to a known scammer/pedophile "loses" everyone's money and your idea is that people should "invest" in him?  Holy fuck that's stupid. 


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 06, 2012, 04:59:54 PM
And use the same small telcomm company.  And set up their telcomm plans around the same time.  And pulled a big ol' scam.  Nope, nothing to see here.  Bitfloor definitely just got hacked; no need to believe that a bitcoin operator worked with the "Most famous man (and pedo) in bitcoin" to run off with $200k.  

Border is your brain incapable of logic?

Why exactly would Roman need Bruce help to steal from his own server?  Even assuming he did this as an inside job (which I doubt) why exactly would he want to include Bruce and split the profit?  What exactly did Bruce bring to the table?  Did Bruce drive the getaway car?

I mean lets compare:
a) do it yourself:  $200K & no accomplices.
vs
b) include Bruce: $100K & an accomplice who would probably rat you out for $20 and a pack of menthols.

Hmm.  You sure cracked the case wide open Inspector!


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 06, 2012, 05:01:45 PM
Quote

Excellent point. Bitfloor  has been very good to it's customers. Lowest fees, very easy to use, excellent (and personalized) customer service. No shady "account locking." No information extortion.

How can we help?
1) If you have funds there, be patient. We gave gox forever and a day, and they were making WAY more than Bitfloor. (quadruple the fees on a 10x-100x the volume)
2) Offer to invest in Bitfloor.

Roman, if you're reading this: This thread is clearly not the place to discuss it, but if you're willing to accept investment, that seems like the best way your user base can help you recover ASAP.

I'm not a big enough player to make much of a dent, but I would be willing to invest. It seems like you should start some kind of discussion on going forward with this, if you're considering it.



So a guy with shady connections to a known scammer/pedophile "loses" everyone's money and your idea is that people should "invest" in him?  Holy fuck that's stupid. 
Not as stupid as your "connections"....do you know how many people went on Bruce's show? Why don't you let the adults talk newb/sockie?


Title: Re: bitfloor needs your help!
Post by: ElectricMucus on September 06, 2012, 05:03:39 PM
And use the same small telcomm company.  And set up their telcomm plans around the same time.  And pulled a big ol' scam.  Nope, nothing to see here.  Bitfloor definitely just got hacked; no need to believe that a bitcoin operator worked with the "Most famous man (and pedo) in bitcoin" to run off with $200k.  

Border is your brain incapable of logic?

Why exactly would Roman need Bruce help to steal from his own server?  Even assuming he did this as an inside job (which I doubt) why exactly would he want to include Bruce and split the profit?  What exactly did Bruce bring to the table?  Did Bruce drive the getaway car?

I mean lets compare:
a) do it yourself:  $200K & no accomplices.
vs
b) include Bruce: $100K & an accomplice who would probably rat you out for $20 and a pack of menthols.

Hmm.  You sure cracked the case wide open Inspector!

I think the point here is that it stinks from the same direction, and assuming a scam it would make sense for him to get some pointers from his mentor, if he receives a cut or not.

I don't really think that matters at this point, given the track-record of other incidents, it's over and most likely there isn't any new info to be revealed at a later date.


Title: Re: bitfloor needs your help!
Post by: ErnestoJuarell on September 06, 2012, 05:26:29 PM
Why would someone pull an inside job like you are claiming if their real identity is publicly known? They could face harassment, physical threats, and legal issues. Especially with Bitcoin being used by such shady people.


Title: Re: bitfloor needs your help!
Post by: ElectricMucus on September 06, 2012, 05:37:47 PM
Why would someone pull an inside job like you are claiming if their real identity is publicly known? They could face harassment, physical threats, and legal issues. Especially with Bitcoin being used by such shady people.

Not shady enough...at this point, it's basically

Arr, I've got your coins!!


http://images.wikia.com/central/images/3/38/Okay_face.jpg


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 06, 2012, 05:53:51 PM
anyone notice the title of the thread? I don't see many responses to the plea for help...That said, just because we want Bitcoin to be decentralized and all that jazz, it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.

Excellent point. Bitfloor  has been very good to it's customers. Lowest fees, very easy to use, excellent (and personalized) customer service. No shady "account locking." No information extortion.

How can we help?
1) If you have funds there, be patient. We gave gox forever and a day, and they were making WAY more than Bitfloor. (quadruple the fees on a 10x-100x the volume)
2) Offer to invest in Bitfloor.

Roman, if you're reading this: This thread is clearly not the place to discuss it, but if you're willing to accept investment, that seems like the best way your user base can help you recover ASAP.

I'm not a big enough player to make much of a dent, but I would be willing to invest. It seems like you should start some kind of discussion on going forward with this, if you're considering it.

I also think you should let your accountholders with USD withdraw immediately before any other steps are taken.

Best wishes.


I agree about the USD. This theft had to do with BTC not USD. Please release my funds.

This is an unfortunate event. I really want to stay with Bitfloor. I want to offer any of my professional services pro-bono.

Bitfloor has potential. I am just personally upset about the USD thing. If it was BTC then it is out of my hands and I will have to wait. But it is USD and it is still in the form of USD and this is something I know I have some control about or I would not be doing as much bitching :(

Roman, I am on your side, I am just annoyed :(


Title: Re: bitfloor needs your help!
Post by: peasant on September 06, 2012, 06:37:37 PM
This long with no reply or contact. Doesn't look good. Hope i'm wrong.


Title: Re: bitfloor needs your help!
Post by: Vod on September 06, 2012, 07:07:56 PM
Why would someone pull an inside job like you are claiming if their real identity is publicly known? They could face harassment, physical threats, and legal issues. Especially with Bitcoin being used by such shady people.

They could yes.  But judging from history, the bitcoin community is more likely to roll over and take it.


Title: Re: bitfloor needs your help!
Post by: qxzn on September 06, 2012, 07:19:00 PM
I've personally met Roman a number of times, and even worked with him on a project (thewalletlist.com). I have significant funds with bitfloor (mostly USD, 5 figures), and I'm not at all concerned that he's going to run off with any of it. Dunno if that helps reassure at all. I totally understand the suspicion -- it's easy to get frightened and let your imagination run wild when your money hangs in the balance.

Also knowing Roman, $250k is probably not all that much money to him. It seems totally counter to his interests for him to destroy his reputation in the bitcoin world for what amounts to a mediocre sum. On the other hand, he has a lot to gain by resolving this situation responsibly (and ideally, without bankruptcy) and earning a good chunk of reputation and trust. I'm convinced he will do so, enough so that I'd gladly take the "Roman is not a thief" side of a betting contract :).

As far as the future...

It would be sad to see Bitfloor fold! It has a lot of good aspects, most notably it has far and away the best exchange technology platform. I'm talking about the matching engine design and algorithms and apis, not the security obviously. I say this having done automated trading with mtgox, campbx, virwox, and tradehill -- in my view bitfloor is a large step ahead of all of these.

On the other hand, an exchange is more than just a fast matching engine. It needs a whole supporting team; legal, banking, accounting, security, marketing etc. This may be the wakeup call Roman needs to see that Bitfloor may benefit from some help. I've long thought that a partnership where Roman handles the exchange technology, and others deal with other components, could produce something really robust and good. Whether that means hiring other people, selling out to another exchange, or just leasing technology/support to an exchange; I'm not sure.

For getting out of the immediate slump -- my favorite idea so far is for Roman to raise funds by selling preferred shares -- equity & debt -- to bring on small handful of investors (including yours truly :). He should maintain more than 50% equity for sure, so the shares can be mostly debt with a smallish equity component. The debt should be countersigned by Roman personally and probably repay aggressively i.e. 100% of revenues until it's been fully repaid. With an arrangement like this I expect he can attract enough investors to make this just a bump in the road for Bitfloor.


Title: Re: bitfloor needs your help!
Post by: qxzn on September 06, 2012, 07:22:29 PM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.

There's definitely profit to be made by coming up with a way to keep coins that is both secure and easy to use (but not necessarily cheap or free!).


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 06, 2012, 07:36:11 PM
anyone notice the title of the thread? I don't see many responses to the plea for help...That said, just because we want Bitcoin to be decentralized and all that jazz, it doesn't mean we shouldn't get law enforcement involved when thefts occur.  It's computer hacking or fraud at the very least.

Excellent point. Bitfloor  has been very good to it's customers. Lowest fees, very easy to use, excellent (and personalized) customer service. No shady "account locking." No information extortion.

How can we help?
1) If you have funds there, be patient. We gave gox forever and a day, and they were making WAY more than Bitfloor. (quadruple the fees on a 10x-100x the volume)
2) Offer to invest in Bitfloor.

Roman, if you're reading this: This thread is clearly not the place to discuss it, but if you're willing to accept investment, that seems like the best way your user base can help you recover ASAP.

I'm not a big enough player to make much of a dent, but I would be willing to invest. It seems like you should start some kind of discussion on going forward with this, if you're considering it.

I also think you should let your accountholders with USD withdraw immediately before any other steps are taken.

Best wishes.

+1 and it is nice to read a positive post on here when this stuff happens.  It is what it is and in the end I hope something like this happens that is listed above.  I will say this at the end of the day either bitfloor will comeback or something like it will pop up to take its place.  Having just Mtgox (mainly I know there are other but) is just not an option.  I am not sure how they do things in Japan but I will say that for us U.S. folks bitfloor hit a solid home run and so we need something like that again.  (Just with better security ops :) )


Title: Re: bitfloor needs your help!
Post by: Otoh on September 06, 2012, 07:38:19 PM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.

There's definitely profit to be made by coming up with a way to keep coins that is both secure and easy to use (but not necessarily cheap or free!).

needs:

http://i.ebayimg.com/t/CHINA-1985-GOLD-VAULT-PROTECTOR-/00/s/NDIwWDMwMA==/$T2eC16ZHJF8E9nnC8G5iBQP6GQrwSQ~~60_12.JPG

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&item=320973579902 I didn't win it :-\ but at least the image is free


Title: Re: bitfloor needs your help!
Post by: rjbtc on September 06, 2012, 07:46:13 PM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.

Something like a cheap netbook with Linux and a flash drive?


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 06, 2012, 08:46:01 PM
I've personally met Roman a number of times, and even worked with him on a project (thewalletlist.com). I have significant funds with bitfloor (mostly USD, 5 figures), and I'm not at all concerned that he's going to run off with any of it. Dunno if that helps reassure at all. I totally understand the suspicion -- it's easy to get frightened and let your imagination run wild when your money hangs in the balance.

Also knowing Roman, $250k is probably not all that much money to him. It seems totally counter to his interests for him to destroy his reputation in the bitcoin world for what amounts to a mediocre sum. On the other hand, he has a lot to gain by resolving this situation responsibly (and ideally, without bankruptcy) and earning a good chunk of reputation and trust. I'm convinced he will do so, enough so that I'd gladly take the "Roman is not a thief" side of a betting contract :).

As far as the future...

It would be sad to see Bitfloor fold! It has a lot of good aspects, most notably it has far and away the best exchange technology platform. I'm talking about the matching engine design and algorithms and apis, not the security obviously. I say this having done automated trading with mtgox, campbx, virwox, and tradehill -- in my view bitfloor is a large step ahead of all of these.

On the other hand, an exchange is more than just a fast matching engine. It needs a whole supporting team; legal, banking, accounting, security, marketing etc. This may be the wakeup call Roman needs to see that Bitfloor may benefit from some help. I've long thought that a partnership where Roman handles the exchange technology, and others deal with other components, could produce something really robust and good. Whether that means hiring other people, selling out to another exchange, or just leasing technology/support to an exchange; I'm not sure.

For getting out of the immediate slump -- my favorite idea so far is for Roman to raise funds by selling preferred shares -- equity & debt -- to bring on small handful of investors (including yours truly :). He should maintain more than 50% equity for sure, so the shares can be mostly debt with a smallish equity component. The debt should be countersigned by Roman personally and probably repay aggressively i.e. 100% of revenues until it's been fully repaid. With an arrangement like this I expect he can attract enough investors to make this just a bump in the road for Bitfloor.

I am sure his lawyer has told him to keep his mouth shut at this moment.

I do hope Bitfloor doesn't fold. I am working on a project right now and my partner and I would LOVE to partner up with Bitfloor.

I will try and just bite the bullet. :)


Title: Re: bitfloor needs your help!
Post by: shtylman on September 06, 2012, 08:48:13 PM
Bitfloor status update - September 6, 2012 (https://bitcointalk.org/index.php?topic=106251.0)


Title: Re: bitfloor needs your help!
Post by: qxzn on September 06, 2012, 09:50:02 PM
Relevant comment from a newbie thread:

https://bitcointalk.org/index.php?topic=106234.0


Title: Re: bitfloor needs your help!
Post by: marcus_of_augustus on September 06, 2012, 10:40:29 PM
Why can't someone invent a machine that can be switched on or off to connect to the internet and it's only purpose is to be a bitcoin wallet. It can have a little screen that says how many BTC you have. Just connect and it updates and disconnect. And the main thing would be if you needed to send BTC, it would require you to insert some type of key or swipe a card or something.

There's definitely profit to be made by coming up with a way to keep coins that is both secure and easy to use (but not necessarily cheap or free!).

Automated multi-sig is the answer to this ... Gavin already outlined it in one of his blog posts.


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 06, 2012, 11:30:52 PM
It's absolutely amazing to see that someone loses $200k+ through, at minimum, gross negligence, and this community rallies behind them and suggests they raise money through an IPO.  There is no sympathy to be had anytime these idiots get scammed.  I've never seen so many gullible marks gathered in one place. 

Did Mr. Bitfloor know about Bruce Wagner's mortgage fraud and pedophilia before or after appearing on his show?  If the answer is the former (and it's REALLY hard to believe he hadn't heard a thing about it), why would anyone dealing with BTC trust someone who willingly and enthusiastically promotes their business with a known scammer and pedophile? 


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 06, 2012, 11:45:34 PM
Customer assets are customer assets.  It doesn't matter if they are dollars, bitcoins or bananas.  If BitFloor does not have reserves (and that was reported in OP) or any other way to make customers whole, then this is a bankruptcy case.  This exchange is operating in the U.S., there are very specific laws as to how to proceed.

Disbursing funds to some customers and not others would be a criminal act under those.

I believe a court order (injunction) should be filed to help ensure the exchange operator proceeds as prescribed by law.

Bitcoins were stolen, not cash. That cash is not Bitfloors to distribute to other customers. It's mine.

Doesn't work that way in the U.S.

A quick search and I couldn't find the exact description about how customer funds are pooled (giving a net balance), regardless if the account had a balance of securities or cash, then disbursed. 

Here's from Canada, which is pretty much the same in the U.S.

^^^What total idiocy.  Next time, listen to your intellectual superiors instead of the low-information voices in your hollow shell of a head thing.   ;)

After careful consideration, ACH withdrawals of USD from Bitfloor will soon be re-enabled, with details to be posted on bitfloor.com.

cheers,
~Roman


Bwah-haha-hahaha!  Gornick jurisprudence FTW!!1!

Please Steve, tell everyone "how it works in the U.S." again.  Share some more of your hilarious 'Canadian legal wisdom.' 

I could use another good laugh at your (thieving communist) expense.   ;D


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 06, 2012, 11:46:26 PM
This user is currently ignored.
I'm sorry, what's that? I'm sure it was important and insightful, maybe post it again.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 06, 2012, 11:52:16 PM
Replace word "bitcoins" by "potatoes" and any judge will figure out on the spot what to do.

Why would any judge with half a brain do that?

Potatoes are real items, produced by potato farmers farming their potato farms.

Bitcoins are just numbers, produced by an experiment requiring voluntary, willful participation.

You and Gornick should partner up and start an internet law firm.  You can specialize in ridiculous, inapplicable arguments without basis in reality.

And stealing USD, "because bitcoin."


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:03:53 AM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Wrong!  Roman has talked with a lawyer, and of course that lawyer confirmed what was immediately obvious to those of us possessing both ethics and intellect.

Why presume to speak about which you know nothing?  It only leads to public embarrassment.

What a shame that so many strain (to no avail in this case) to overturn its common law, common sense, and common decency in the name of Marxist notions of equal outcomes and false 'fairness.'


Title: Re: bitfloor needs your help!
Post by: BorderBits on September 07, 2012, 12:12:47 AM
This user is currently ignored.
I'm sorry, what's that? I'm sure it was important and insightful, maybe post it again.

Hey look, a bitcoiner plugging his ears and shouting "lalalalalala."  Man it's funny to watch idiots get scammed.  Where's my popcorn? 


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 07, 2012, 12:13:55 AM
Let it go iCEBREAKER.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:14:10 AM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution

Actually, that clause is exactly the problem.  Until due process of law, it is not legally clear whether any of the USD controlled by bitfloor is the property of those who had BTC on deposit, the property of bitfloor, or solely the property of those who have USD on deposit with bitfloor.  Bitfloor therefore cannot legally give USD to anyone until due process determines exactly whose property each and every $0.01 is.

Here's your "due process" champ: Roman talked to a lawyer, who told him exactly what Death&Taxes, myself, and others have been saying all along.   :D

Here's your "legal clarity" ace: The burden is on those who 'lost' BTC to sue those of us who are looking forward to a nice, juicy ACH transfer into our happy bank accounts.

Good luck with that flimsy pretext, which will be thrown out of court like last week's garbage as completely frivolous and totally without merit.

Recognition of property rights is enshrined in the US Constitution.  Specifically, the 5th Amendment.  If you can't understand that, STFU when the adults are talking.   8)


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:18:37 AM
Holding our USD without our consent is illegal.  BitFloor must start accepting and processing USD withdrawals ASAP.
Unfortunately for those of us who had significant USD balances at Bitfloor, what others are saying is correct: Roman must now cease all activity — even activity that many of us would consider "the right thing to do" — and seek legal counsel. Assuming everything is handled sanely in the court system (a big assumption), we might expect a refund of our USD balances in a few months — either all or in part, depending on whether the balances were legally segregated and allocated, which I doubt they were.

Nope, they (and you) were 100% flat-out wrong.  That's what happens when you disagree with me.  You turn out to be wrong.  Usually sooner than later.   ;D

Cheers to Roman for doing the right thing, and for checking with a lawyer to make sure the law still allows for such outrageous meritorious actions!


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:30:31 AM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution


These are all things for the legal council (and if it goes to U.S. court, the judge) to decide in order to figure out what actions are appropriate. That's where the "due process of law" comes in. You're entitled to your process, BitFloor is entitled to theirs. BitFloor seeking legal council is where he ensures that he is acting in a way most within the law. Your process would be serving BitFloor and/or suing them.

Things are not that simple that withdrawals can happen just for the solvent parts of the business held; welcome to the world of BitCoin, where everything is without absolute legal precedent (yet). If a legal precedent can be set that the BTC has value, it would be illegal for them to use any portion of the assets (including remaining balances held for what wasn't hacked) to pay out to anybody until the appropriate process on reimbursing has been determined in court.

This WILL not be a quick process. The only quick process would be if the coins were returned by the hacker, or if someone invested BTC in BitFloor in exchange for ownership (or a portion of). I'd imagine this case (albeit not a likely one) is the one that BitFloor is hoping for the most.

Best case for USD holders (and worst case for BTC holders) is that his legal council (or the court system) determines that BTC will be considered "worthless" and that USD should be distributed to account holders as it's the only part of BitFloor that needs to be legally held solvent. However, I can just about guarantee that if this happens, anyone holding a large amount of BTC will file an injunction and appeal, which will almost certainly prevent payout of USD funds from happening quickly.

Hang on folks, this is likely to be an interesting one, especially since it's occurring in the oh-so-litigious US.

Making a very simple case of ownership too complex and complicated to be dealt with without expensive lawyers is a hallmark of cultural Marxism.

In this case, happily, you have utterly failed to correctly predict the immediate future.  That's a good reason to start checking your premises.

There were never any due process concerns, that was just a weak, lousy excuse to steal USD by those who lost BTC.

So much for your certainty that "This WILL not be a quick process."

So much for your "guarantee
that if this happens, anyone holding a large amount of BTC will file an injunction and appeal, which will almost certainly prevent payout of USD funds from happening quickly."

Maybe Gornick and Vladimir will let you join their internet law firm, and help them lose 100% of their cases by making specious Marxist arguments that fly directly in the face of common law, common sense, and common decency?

Fail, Failure, and Falemore. 
Internet Attorneys at Fail Law. 
A proven track record of blithering ignorance. 
Specializing in not recovering stolen BTC since 2010.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:37:54 AM
If your sole qualification for making statements about US law is the fact that you have an opinion about US law, you might want to STFU before you make a fool of yourself to a greater extent.

iCEBREAKER: Expressed an opinion about US law that was soon proven to be correct.

blakdawg: Expressed an opinion about US law that was soon proven to be incorrect.

So dawg, who needed to STFU?  Oh yes, it was you!

So dawg, who made a fool of themselves to a great extent?  Again, it was you!


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 12:48:10 AM
My bet is that everyone with funds at Bitfloor will end up with a pro rata share of the total "deposits", with BTC valued at today or yesterday's average USD exchange rate. And court fees, attorney fees, accountant fees, trustee's fees, and all of the rest come out first.

So a pretty good outcome would probably look like 25% of your total deposits (assuming, overall, that half of the value deposited was BTC (which is now gone) and half was USD, and half of what's left gets spent on the friction of litigation), and you'll probably get it in 12-18 months.

Well you lost that bet.  Big Time.  You were wrong about both the terms and the timing.

And it didn't take long for you to lose it either!   ;D

At this rate you'll soon be a senior partner in the disreputable internet law firm of

Fail, Failure, and Failmore.
Providing worthless opinions regarding matters far beyond our comprehension since 2010.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 07, 2012, 12:52:52 AM
If your sole qualification for making statements about US law is the fact that you have an opinion about US law, you might want to STFU before you make a fool of yourself to a greater extent.

iCEBREAKER: Expressed an opinion about US law that was soon proven to be correct.

blakdawg: Expressed an opinion about US law that was soon proven to be incorrect.

So dawg, who needed to STFU?  Oh yes, it was you!

So dawg, who made a fool of themselves to a great extent?  Again, it was you!

Nothing has been proven. I suspect that Roman's actions indicate that he will absorb the BTC losses himself, or investors/lenders will provide him with funds to do so. I suspect (but do not know) that Roman has talked to one or more attorneys, hopefully he'll be smart enough to keep his mouth shut about what they told him so that he won't waive the attorney/client privilege.

Whether or not the Fifth Amendment controls the behavior of private individuals was never in question - it does not, and never has. Any claim to the contrary reveals the maker as a buffoon. This is not an interesting question, or a close question, or even a question. It's basic constitutional law. Disputing it is like insisting that "2 + 2 = 5" or that the sun orbits the earth. You can shout and call names all you like - the harder you fight, the dumber you look.

But, I'll say this for you - you are amusing, though you might want to give that "communist" thing a rest.



Title: Re: bitfloor needs your help!
Post by: blakdawg on September 07, 2012, 12:54:43 AM
My bet is that everyone with funds at Bitfloor will end up with a pro rata share of the total "deposits", with BTC valued at today or yesterday's average USD exchange rate. And court fees, attorney fees, accountant fees, trustee's fees, and all of the rest come out first.

So a pretty good outcome would probably look like 25% of your total deposits (assuming, overall, that half of the value deposited was BTC (which is now gone) and half was USD, and half of what's left gets spent on the friction of litigation), and you'll probably get it in 12-18 months.

Well you lost that bet.  Big Time.  You were wrong about both the terms and the timing.

If I was wrong about that, I think it's great news. I don't like to see people lose money to criminal behavior.

On the other hand, we're not done. This story wasn't over yesterday and it's not over today and it's not going to be over tomorrow. So it's a little early to be calling wins and losses.



Title: Re: bitfloor needs your help!
Post by: marcus_of_augustus on September 07, 2012, 01:05:40 AM
Quote
Those are my USD, not yours . . .

This is not at all clear under US law, which would presumably apply given Bitfloor's ties to the US.

Au contraire, US law is perfectly clear on the matter:

Quote
No person shall be...deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution

Actually, that clause is exactly the problem.  Until due process of law, it is not legally clear whether any of the USD controlled by bitfloor is the property of those who had BTC on deposit, the property of bitfloor, or solely the property of those who have USD on deposit with bitfloor.  Bitfloor therefore cannot legally give USD to anyone until due process determines exactly whose property each and every $0.01 is.

Here's your "due process" champ: Roman talked to a lawyer, who told him exactly what Death&Taxes, myself, and others have been saying all along.   :D

Here's your "legal clarity" ace: The burden is on those who 'lost' BTC to sue those of us who are looking forward to a nice, juicy ACH transfer into our happy bank accounts.

Good luck with that flimsy pretext, which will be thrown out of court like last week's garbage as completely frivolous and totally without merit.

Recognition of property rights is enshrined in the US Constitution.  Specifically, the 5th Amendment.  If you can't understand that, STFU when the adults are talking.   8)

Sounds like we need get you onto Jon Corzine on behalf of the MF Global customers who are still waiting for their deposits back ....


Title: Re: bitfloor needs your help!
Post by: UNOE on September 07, 2012, 01:06:16 AM
How many triple post are you going to make.  In fact I've actually never seen a quintuple post.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 01:10:16 AM
Let it go iCEBREAKER.

Common sense, common law, and common decency say that the presumption of ownership remains with the original USD depositors.

That is why I have no patience with anyone willing to entertain/support the amoral, collectivist Marxist lawyer POV of negotiable property rights.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 01:39:45 AM
If your sole qualification for making statements about US law is the fact that you have an opinion about US law, you might want to STFU before you make a fool of yourself to a greater extent.

iCEBREAKER: Expressed an opinion about US law that was soon proven to be correct.

blakdawg: Expressed an opinion about US law that was soon proven to be incorrect.

Nothing has been proven. I suspect that Roman's actions indicate that he will absorb the BTC losses himself, or investors/lenders will provide him with funds to do so. I suspect (but do not know) that Roman has talked to one or more attorneys, hopefully he'll be smart enough to keep his mouth shut about what they told him so that he won't waive the attorney/client privilege.

I didn't think you would lose the argument gracefully, Mr. "Nothing has been proven despite imminent ACH transfers."  Thanks for living down to my low expectations.   ::)


I have waited to post updates until I had a clearer understanding of how to move forward.

After careful consideration, ACH withdrawals of USD from Bitfloor will soon be re-enabled, with details to be posted on bitfloor.com.
cheers,
~Roman

It's perfectly obvious that Roman has been given legal advice and he is now proceeding to operate under its direction.   ;D

All of your random yammering about waiving attorney/client privilege is as irrelevant as your previous threadjacking blather regarding incorporation of the US Bill of Rights. 


For those of you in Rio Linda (cough *blakdawg* cough), when Roman says

Quote
until I had a clearer understanding of how to move forward.
  he means 'until I had a chance to talk to 3 or 4 lawyers.'

And for those of you weak of mind and slow in wit (cough *blakdawg again* cough), when Roman says
Quote
After careful consideration
he means 'I have now talked with 3 or 4 lawyers.'

Finally, for the slow learners in the class (cough *who else but blakdawg* cough), when Roman says
Quote
ACH withdrawals of USD from Bitfloor will soon be re-enabled
he means 'the lawyers have confirmed that iCEBREAKER was correct as usual, and if I hold USD without their owners' consent I will be in a big stinky heap of trouble with the law, blakdawg's farcical communist opinions notwithstanding.'



Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 01:55:58 AM
Sounds like we need get you onto Jon Corzine on behalf of the MF Global customers who are still waiting for their deposits back ....

Heh.  Don't get me started!   >:(

Give me Corzine, a soundproof basement, and a box of pliers.  Plus some thick rubber gloves.  I'll find the MFGlobal money he stole PDQ.

Actually, let Gerald Celente handle Corzine.  He's old school NY Italian and could teach me some 'classic methods of persuasion.'   :o

There are already enough wanna-be Corzine rat finks running around here to keep me and my (verbal) dissection kit plenty busy.


Title: Re: bitfloor needs your help!
Post by: blakdawg on September 07, 2012, 02:01:21 AM
I didn't think you would lose the argument gracefully, Mr. "Nothing has been proven despite imminent ACH transfers."  Thanks for living down to my low expectations.   ::)

Look, maybe you just fell off the turnip truck, but if I got excited every time someone told me something was happening "soon" or that it was "imminent", well, I'd probably be babbling incoherently on the Internet about Marxists or something.

Like I said, I think it's great news if my prediction turns out to be wrong. But I'll believe that when dollars hit bank accounts and BTC's hit wallets (or don't).



Title: Re: bitfloor needs your help!
Post by: miscreanity on September 07, 2012, 03:11:04 AM
Relevant comment from a newbie thread:

https://bitcointalk.org/index.php?topic=106234.0

Agreed - the only way out is through.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 03:51:43 AM
I didn't think you would lose the argument gracefully, Mr. "Nothing has been proven despite imminent ACH transfers."  Thanks for living down to my low expectations.   ::)

Look, maybe you just fell off the turnip truck, but if I got excited every time someone told me something was happening "soon" or that it was "imminent", well, I'd probably be babbling incoherently on the Internet about Marxists or something.

Like I said, I think it's great news if my prediction turns out to be wrong. But I'll believe that when dollars hit bank accounts and BTC's hit wallets (or don't).

*climbs back on turnip truck*

You're right, "imminent" was the wrong word to use.  

Because I, among others, just logged on to BitFloor and initiated an ACH transfer despite your endless whiny impotent protests.   ;D

Why don't you put your money where your overused mouth is, and file an injunction against Bitfloor to stop these shameful, illegal actions?

Better still, why don't you sue me and try to claw back some USD that were never yours and always mine?  

My guess is you know you have zero, zip, zilch, nada chance of success but just can't bring yourself to admit that you were 100% wrong.

Your embrace of Corzine-style bankster logic is communist because it disregards property rights and falsely conflates equality of outcomes with fairness.  Now do you hear what I'm saying bro; now do you know what I mean, dawg?

Your embrace of overcomplicating, complexifying, and lawyering what should be a simple matter is a trademark of cultural Marxism.  Is that clear enough or do you require further elaboration (perhaps even citation) to facilitate comprehension?

Could you possibly fail any harder, Mr. "Nothing has been proven despite current and ongoing ACH transfers."?  

I don't think so.  If you found a way to be any more wrong, that in itself would be some kind of accomplishment.   8)



Title: Re: bitfloor needs your help!
Post by: blakdawg on September 07, 2012, 04:11:31 AM
Why don't you put your money where your overused mouth is, and file an injunction against Bitfloor to stop these shameful, illegal actions?

Better still, why don't you sue me and try to claw back some USD that were never yours and always mine? 

My guess is you know you have zero, zip, zilch, nada chance of success but just can't bring yourself to admit that you were 100% wrong.

I'm not going to sue anyone because I didn't lose anything. I realize this idea may simple be too complicated for you to grasp - but it is possible to think and reason about things that aren't actually happening directly to me.

Talking to you is like playing hide-and-go-seek with a very young child who thinks that because they he can't see anyone else, nobody can see him, either.

Here's the deal: it doesn't actually work that way. Not with hide-and-seek, and not with facts or law.

Your "reasoning" (which has the same relationship to actual thinking as mud pies do to apple pies) seems to spring from one source: your own self-interest. You want the USD back that you had deposited at Bitfloor so you could exchange it for some worthless experimental imaginary internet nerd tokens. Accordingly, any possible facts or ideas which might get in the way of YOU getting what YOU wanted, RIGHT NOW, are to be rejected as communist tricks; and any formulation of words, no matter how ridiculous, which apparently supports you getting what you want is celebrated as "common sense" or "common decency".

(And I'm sure your ideas about "common sense" and "common law" would have dictated an opposite result, in the event that you had BTC on deposit instead of USD.)

What happens or doesn't happen to Bitfloor has zero impact on my finances because I do not leave significant funds (in whatever currency) on "deposit" with online exchanges.

I had approximately 11 cents at Bitfloor at the time of the hack, left over from an exchange transaction - I don't remember if it was BTC or USD, and don't really care either way.

So when I write something about Bitfloor, it's not because I'm panicked that I exchanged my last funds on this earth for "experimental imaginary internet nerd tokens" that were stolen - or because I'm elated because it turns out that I can get my USD back since my money hadn't been exchanged yet.

I realize that you're excited that you were able to access a web page that led you to believe you'll get an ACH/wire transfer in a few days. That's good news for you. I can see you feel like a winner. And I can see that you think that since you're a winner, everyone who you don't like is a loser.

So go ahead. Run with that. Celebrate. You win!


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 07, 2012, 04:43:40 AM
. . .What total idiocy. . .
. . .Why would any judge. . .
. . .Wrong! . . .
. . .Au contraire. . .
. . .Nope, they (and you) were 100% flat-out wrong. . .
. . .Au contraire. . .
. . .iCEBREAKER: Expressed an opinion. . .
. . .Well you lost that bet. . .
. . .Common sense, common law, and common decency say. . .
. . .I didn't think you would lose the argument gracefully. . .
. . .Heh.  Don't get me started! . . .
. . .*climbs back on turnip truck*. . .
Wow. 12 posts in a row all to say "Neener, neener, neener. I'm great and you are all dumb!"
You might want to cut back on the caffeine.

BitFloor did the right thing.  They contacted legal help and made sure that everything was handled properly rather than taking the advice of you, me, or any other random person trying to give advice on an internet discussion forum.  They shut down ALL withdrawals, and stopped all public communication for a few days (probably on advice from those lawyers) giving the lawyers time to figure out the best legal course of action.  It is not yet clear exactly what the final determinations were, but they have decided that ACH withdrawals of USD are now acceptable.  That's great and I'm glad to hear it, but there may be a lot of circumstances behind that decision, and it might not be as simple as you've implied.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 04:52:53 AM
I'm not going to sue anyone because I didn't lose anything.

[irrelevant, long winded, tedious ad hominem removed for brevity]
[irrelevant, long winded, tedious cool bro story removed for brevity]


I realize that you're excited that you were able to access a web page that led you to believe you'll get an ACH/wire transfer in a few days. That's good news for you. I can see you feel like a winner. And I can see that you think that since you're a winner, everyone who you don't like is a loser.

So go ahead. Run with that. Celebrate. You win!

That's nice you didn't lose anything, hooray! 

But you are still wrong about those who did lose BTC having the standing to enjoin/sue USD anyone.  They don't have standing, won't file for an injunction, and can't sue for clawbacks.  Period.  Case dismissed!

The "web page" I accessed that led me "to believe" I'll get an ACH/wire transfer in a few days is BitFloor.com, not some random geocities page.

How reprehensibly immature of you to purposefully conflate a well-known, reputable exchange with just any old probable scam site!   >:(

Should we can be taking this to Scam Accusations?   ???

If you truly and honestly believe Roman and his BitFloor exchange are not going to pay out the requested ACH transfers as promised, please present your evidence for that conclusion. 

Oh wait, you don't have any.   :D

Silly widdle dawggy, you really should learn to stop pooping on the carpet.  Wait to go outside, or at least use the newspaper.  Until then, I'll just have to keep swatting you with the newspaper and rubbing your nose in it.   :-\


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 07, 2012, 05:12:33 AM
. . .Heh.  Don't get me started! . . .
Wow. 12 posts in a row all to say "Neener, neener, neener. I'm great and you are all dumb!"
You might want to cut back on the caffeine.

Wrong again.  That "Don't get me started" quote is about Corzine's actions re:MFGlobal and has nothing to do with the fact that I am great and all who disagreed with me acted stupidly.

You might want to have some more coffee.   :)

Wow.  12 quotes in a row just to say "Boo hoo hoo, I don't like being held accountable for being foolish enough to debate iCEBREAKER on topics he is more knowledgeable about than myself."

You might want to cut back on the meth.   ;)

BitFloor did the right thing. 

I agree.  Finally, you got something right!  Good for you.

They shut down ALL withdrawals, and stopped all public communication for a few days (probably on advice from those lawyers) giving the lawyers time to figure out the best legal course of action.  It is not yet clear exactly what the final determinations were, but they have decided that ACH withdrawals of USD are now acceptable.

Oops, now you're back to being wrong.  Scheduled ACH withdrawals did go out, even while the site was down for a much-needed security audit.  Any ACH withdrawals were "acceptable" (IE perfectly legal) the entire time, even before the lawyers retroactively approved them.

The "final determination" is exactly clear (despite the best obfuscatory efforts of Fail Team FUD) and it is that I'm going to get my USD back in 2-3 days.



Title: Re: bitfloor needs your help!
Post by: jojo69 on September 07, 2012, 06:28:33 AM
sorry icebreaker

you just earned yourself one week on ignore

nothing personal, read you again when you have cooled down

peace


Title: Re: bitfloor needs your help!
Post by: peasant on September 07, 2012, 06:33:16 AM
Yeah. I didn't use the ignore button, but i don't even bother reading the rants anymore. Your opponent has gotten the better of you.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 07, 2012, 02:38:53 PM
Yeah I had to use ignore also, I was part of the group stating Roman had no claim over USD deposits and should return them.  Icebreaker's rants were just pages and pages of wasted space and helped to TOTALLY derail this thread.

Quote
it might not be as simple as you've implied.

Exactly.  The law is never absolute. If all lawyers agreed 100% on everything well you wouldn't need courts.  Your lawyer and my lawyer would simply reach a consensus, have a handshake, and resolve the situation.  

Generally when you have an insolvent debtor all unsecured creditors are treated equally.  The exception would be if deposits were put in "protected and segregated accounts" and that usually requires a trust and third party administrator (casino deposits are an example).  While all unsecured creditors recognized under the law are generally considered equal and paid on a fractional basis in Bankrutpcy, Bitcoin doesn't yet have any standing under the law.  It is questionable if a judge would take that leap and give the BTC creditors equal standing.  That would be a huge decision for a judge to make but it certainly ins't impossible.  Right now many aspects of Bitcoin are simply is undecided law.  

As I pointed out while the standing of BTC depositors may be undecided the standing of USD depositors is certainly not undecided.  In a case of undecided law it simply comes down to risk manangement.  There is no "risk free option".  It is unlikely any retained lawyer would provide absolutes on undecided law.   Still if your lawyer told you the risk of holding the deposits is significantly greater than the risk of allowing them to be returned what would you do?


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on September 07, 2012, 03:38:24 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.


Title: Re: bitfloor needs your help!
Post by: BoardGameCoin on September 07, 2012, 03:43:13 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

I will purchase it for my 36 BTC balance at bitfloor ;)


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 07, 2012, 03:45:22 PM
D&T, is it possible that Bitcoin account holders could be seen as secured creditors (secured because they held an asset - bitcoins - instead of simply being a loaner of USD), and would thus be required to be paid back first?

I tried looking at cases where someone might have a secured claim on a commodity at a bankrupt company, but haven't really been able to find anything like that.

And really, I don't have much of a clue when it comes to bankruptcy law anyway.


Title: Re: bitfloor needs your help!
Post by: muyuu on September 07, 2012, 03:48:55 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on September 07, 2012, 04:01:44 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.



Title: Re: bitfloor needs your help!
Post by: muyuu on September 07, 2012, 04:09:46 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.

Well, I don't have an account and it's closed for registration. Other than that I'd offer 25, deal?


Title: Re: bitfloor needs your help!
Post by: Bitcoin Oz on September 07, 2012, 04:12:14 PM
If theres one thing that bitcoin teaches you it is that if you give your money to a third party then no you dont own it anymore.


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on September 07, 2012, 04:20:32 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.

Well, I don't have an account and it's closed for registration. Other than that I'd offer 25, deal?

Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 07, 2012, 04:41:58 PM
As I pointed out while the standing of BTC depositors may be undecided the standing of USD depositors is certainly not undecided.
I look forward to the day when valuing BTC is a no-brainer for a judge but valuing USD would be laughable. (Think Zimbabwean dollars, Weimar marks, or Confederate dollars.)


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 07, 2012, 05:05:55 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.

Well, I don't have an account and it's closed for registration. Other than that I'd offer 25, deal?

Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.
Why didn't you state up front that you were looking for at least 40% instead of berating people for sending what they believe to be a reasonable offer?


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on September 07, 2012, 05:34:22 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.

Well, I don't have an account and it's closed for registration. Other than that I'd offer 25, deal?

Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.
Why didn't you state up front that you were looking for at least 40% instead of berating people for sending what they believe to be a reasonable offer?

You are the only person doing any berating in this thread.

What I did was kickoff a very necessary discussion into the valuation of Roman's presently defaulted obligations.

Do you have anything constructive to contribute?  If not, please take a Midol and the rest of your life off from posting to me.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 07, 2012, 05:41:37 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

How do you plan to make the sale effective? do you sell your account?

All means of Bitcoin transfers have been shutdown on bitfloor.

I would expect Roman to faciliate the tranfer of obligations to your account.

Well, I don't have an account and it's closed for registration. Other than that I'd offer 25, deal?

Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.
Why didn't you state up front that you were looking for at least 40% instead of berating people for sending what they believe to be a reasonable offer?

You are the only person doing any berating in this thread.

What I did was kickoff a very necessary discussion into the valuation of Roman's presently defaulted obligations.

Do you have anything useful to contribute?  If not, please take a Midol and the rest of your life off from posting to me.
"Not even close" and stating that it is worth "at least 40%" as if the person making the offer was completely stupid for thinking it was worth anything less is pretty berating.  Especially when all you said is "send your offers," not specifying a particular amount to begin with.

I just think it's silly when people ask others to send offers, then scold them for lowballing when there was no precedent for the value of item to begin with.  If you're looking to receive a certain amount for something, then state as much up front.  Anything else is just wasting people's time.

And if you want to discuss the valuation of Roman's defaulted obligations, why not just propose said discussion?  Say, "What would you pay for a piece of Roman's default obligations, as a percentage?"  Bam.  Simple as that.  No need for people to send you useless offers that you will refuse because you're really only just looking for a valuation.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 07, 2012, 05:42:48 PM
Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.

Bitfloor in liquidation (with no outside capitalization) is worth $105,000+?  Essentially the only assets are the code and brand.  While the fair mark value might be a hundred grand generally in liquidation assets go for $0.20 on the dollar or less.  Soft assets (like code, databases, customers lists, etc) go for even less.

So that would put the fair market value on Bitfloor software and brand at roughly $500K to $1M.   Pretty high valuation.  Also you have no chance of piercing the corporate veil unless you can prove criminal negligence occurred.  Also how are you going to get this judgement?  By hiring legal counsel, proving your deposit exists, proving that Bitcoins are worth damages in legal tender that the court can award, and proving criminal negligence to pierce the corporate veil?

The value of your claim is ~$1000 gross once you subtract legal fees out you will have roughly nothing even if you could accomplish all that.  25% is likely overvalued at this point.


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on September 07, 2012, 06:02:38 PM
Not even close.  Bitfloor in liquidation is worth at least 40% of the reported losses.  Plus gross negligence on Roman's part should make it straightforward to get a judgement against his personal assets.

Bitfloor in liquidation (with no outside capitalization) is worth $105,000+?  Essentially the only assets are the code and brand.  While the fair mark value might be a hundred grand generally in liquidation assets go for $0.20 on the dollar or less.  Soft assets (like code, databases, customers lists, etc) go for even less.

So that would put the fair market value on Bitfloor software and brand at roughly $500K to $1M.   Pretty high valuation.  Also you have no chance of piercing the corporate veil unless you can prove criminal negligence occurred.  Also how are you going to get this judgement?  By hiring legal counsel, proving your deposit exists, proving that Bitcoins are worth damages in legal tender that the court can award, and proving criminal negligence to pierce the corporate veil?

The value of your claim is ~$1000 gross once you subtract legal fees out you will have roughly nothing even if you could accomplish all that.  25% is likely overvalued at this point.

Bitfloor's revenue was over 30k / year with a very high growth rate.  I don't see 3x revenue as a very high valuation.

There need be no legal fees.  The bar in small claims cout is very low. Roman posted here using his personal account for all bitfloor business. And criminal negligence is not the bar in cases where there is a fiduciary duty.

Pirate debt is still trading at 15%.  Surely Roman's obligation and a viable, operating enterprise is worth substantially more.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 07, 2012, 06:18:39 PM
Small claims court has no jurisdictional authority to pierce the corporate veil, at least not in VA and seriously doubt it can be done in NY. Filing against Roman personally would simply get it dismissed off the bat.  You certainly could file suit against Bitfloor but then any damages are owed by Bitfloor, Inc.  Bitfloor, Inc already owes you so you haven't accomplished a lot. Just my opinion but the probability of getting awarded damages is very low.  No court in the country has awarded damages based on Bitcoin losses, debts, or claims.  It is somewhat unlikely a small claims judge wants to be the first based on the incomplete evidence and lack of counsel which is common in small claims court. 

If Roman used a personal bank account for company business it "could" be used to pierce the corporate veil.  I don't recall getting any ACHs from Roman I did get ACHs from Bitfloor, Inc.  Still even with technical violations like incorrect accounts, or missed corporate meetings the court usually considers intent.  Was it a technical violation or is there evidence that the intent was to run personal finances through a sham corporations?  Depending on the evidence you *may* get the damages transfered to the owners but it would hardly be "simple".  More like a legal longshot and it isn't going to happen without retaining counsel.


The person offering 25% can likely get as much debt as he can possibly afford for less than 25%.  Good thing for him you rejected him out of hand.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 07, 2012, 06:26:46 PM
I didn't see Roman post that he was using his personal account. My deposits were made to a business account. Care to link the post?


Title: Re: bitfloor needs your help!
Post by: muyuu on September 07, 2012, 06:48:17 PM
Ok then, I take my offer back.

Good luck :P


Title: Re: bitfloor needs your help!
Post by: muyuu on September 07, 2012, 06:59:13 PM
Pirate debt is still trading at 15%.  Surely Roman's obligation and a viable, operating enterprise is worth substantially more.

At 15% it's overpriced but even so 25% is a lot more than 15%.

The person offering 25% can likely get as much debt as he can possibly afford for far far less than 25%.  Good thing for him you rejected it.

I felt generous because he was the first guy to get the ball rolling :D



Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 07, 2012, 07:01:28 PM
muyuu obviously valuation may change if some capital is injected into bitfloor by outside investors.


Title: Re: bitfloor needs your help!
Post by: muyuu on September 07, 2012, 07:26:51 PM
muyuu obviously valuation may change if some capital is injected into bitfloor by outside investors.

Yeah well, 25 for 103 is fine considering it's a small amount. If it was a bigger quantity I wouldn't have offered that much at this point.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 08, 2012, 02:27:20 AM
Yeah well, 25 for 103 is fine considering it's a small amount. If it was a bigger quantity I wouldn't have offered that much at this point.

If you get confirmation that BTC amounts can be transferred account-to-account, then you'll probably find plenty of offers for cents on the dollar.


Title: Re: bitfloor needs your help!
Post by: Inaba on September 08, 2012, 03:16:39 AM
I have done it in small claims court here in Kansas. Granted I don't know NY or VA law, but you absolutely can pierce the corporate veil in small claims court and it doesn't even have to be for criminal activity;  I've done it on civil cases, you just have to show either willful negligence or willful intent to use the corporations to avoid the law and the judge is more than happy to bust right through the corporation and attach the judgement to the owners.  

On an unrelated note, WTH Stephen, you just totally blowing off my PMs completely?  At least respond and tell me you're not interested.


Title: Re: bitfloor needs your help!
Post by: iCEBREAKER on September 08, 2012, 08:27:35 PM
WTH Stephen, you just totally blowing off my PMs completely?  At least respond and tell me you're not interested.

Yes, Steve has been a bit pouty and moody lately, ever since being wrong about the outcome of Bitfloor's situation.  I think it hurt his ego.   :D

Maybe he had more Bitcoins there than he could afford to lose?  Don't worry about it, he's not worth it.


Title: Re: bitfloor needs your help!
Post by: Inaba on September 09, 2012, 04:52:05 AM
All's good, he responded.  And I lost not an insignificant amount of coins on Bitlfoor as well.. ugh.


Title: Re: bitfloor needs your help!
Post by: Rassah on September 09, 2012, 04:54:28 AM
I didn't lose anything in Bit floor, but I'm willing to put up a few hundred as investments or bonds into this thing to get it going again  :P
Any word from Roman as to what he's hoping/planning to do?


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 09, 2012, 07:34:53 AM
ever since being wrong about the outcome of Bitfloor's situation

http://i.imgur.com/evwyy.jpg (http://www.youtube.com/watch?v=1-Sgvq98mjc)

  - http://www.youtube.com/watch?v=1-Sgvq98mjc


Title: Re: bitfloor needs your help!
Post by: muyuu on September 09, 2012, 01:19:16 PM
Yeah well, 25 for 103 is fine considering it's a small amount. If it was a bigger quantity I wouldn't have offered that much at this point.

If you get confirmation that BTC amounts can be transferred account-to-account, then you'll probably find plenty of offers for cents on the dollar.

I'd need to register for that and it's closed for registrations at the moment.


Title: Re: bitfloor needs your help!
Post by: bg002h on September 09, 2012, 10:09:25 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

I will purchase it for my 36 BTC balance at bitfloor ;)

Nice try.

If I end up filing suit in small claims court for my debt, I would consider acting as your agent as well for a reasonable fee.
Good luck with that. If he really does have law enforcement involved, I believe your claim will have to wait...


Title: Re: bitfloor needs your help!
Post by: nimda on September 09, 2012, 10:18:11 PM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

I will purchase it for my 36 BTC balance at bitfloor ;)

Nice try.

If I end up filing suit in small claims court for my debt, I would consider acting as your agent as well for a reasonable fee.
Please do file suit.


Title: Re: bitfloor needs your help!
Post by: chaosman on September 10, 2012, 05:18:50 AM
I am soliciting offers for the purchase of my 103 BTC balance at Bitfloor.

I will purchase it for my 36 BTC balance at bitfloor ;)

Nice try.

If I end up filing suit in small claims court for my debt, I would consider acting as your agent as well for a reasonable fee.
Good luck with that. If he really does have law enforcement involved, I believe your claim will have to wait...
Not necessarily...You can file the summons and complaint and preliminary filings.....I wouldnt do it in small claims..especially in NY. I purchase debt in NY and NJ pre and post judgment on a daily basis. And enforce it on my own behalf... But honestly if I were in this mess..I would have an emergent ex parte motion asking the court to appoint a receiver and to grant a preliminary injunction against all principals and employees from accessessing any servers, offices, bank accounts, etc to allow the receiver to examine and secure everything....
If this happened to a company I was the majority share holder of....I wouldnt be in Europe right now....
http://twitter.com/defunctzombie (http://twitter.com/defunctzombie)


Title: Re: bitfloor needs your help!
Post by: jojo69 on September 10, 2012, 05:39:16 AM

If this happened to a company I was the majority share holder of....I wouldnt be in Europe right now....
http://twitter.com/defunctzombie (http://twitter.com/defunctzombie)


Hmmmmm, in Europe, trying to get in touch with interpol.

interesting


Title: Re: bitfloor needs your help!
Post by: bb113 on September 10, 2012, 08:24:49 PM
So... he said he filed some reports with the FBI, where do we find the record of this?


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 10, 2012, 10:17:41 PM
So... he said he filed some reports with the FBI, where do we find the record of this?
Well technically if a report was filed you can do a FOIA but during an ongoing investigation it might be slow or after the case is closed.  The fastest and probably best answer is that the person who filed it should request a copy and post it as additional news of actions being done to resolve the matter.  As a show of good faith it might be worth having a copy of the report posted on the site.


Title: Re: bitfloor needs your help!
Post by: fcmatt on September 11, 2012, 12:49:50 AM
is there some reason an analysis of how the hack took place is not being made public?


Title: Re: bitfloor needs your help!
Post by: whitslack on September 11, 2012, 04:13:38 AM
is there some reason an analysis of how the hack took place is not being made public?
Maybe someone is waiting for the statute of limitations to run out? LoL, just kidding. I don't suspect Roman in the least.


Title: Re: bitfloor needs your help!
Post by: bb113 on September 11, 2012, 11:20:16 PM
When I try to log in for an ACH transfer I get:

Quote
504 Gateway Time-out
The server didn't respond in time.

Shtylman?


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 12, 2012, 03:27:53 AM
When I try to log in for an ACH transfer I get:

Quote
504 Gateway Time-out
The server didn't respond in time.

Shtylman?

Agreed, so as time passes more and more of bitcoin is fading away with no word of any action or future plans.  It is beginning to look more and more like there will be not bitfloor in the future.  Please someone tell me that is not the case but until then I will keep an eye out for the future blogs of what action (or talk of action) do we do next those who were with bitfloor.

Signed,
Slowing losing patience


Title: Re: bitfloor needs your help!
Post by: shtylman on September 12, 2012, 06:36:23 AM
When I try to log in for an ACH transfer I get:

Quote
504 Gateway Time-out
The server didn't respond in time.

Shtylman?

Please contact support if you are experiencing an issue with the website. I have checked and the website appears to be operating normally.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 12, 2012, 06:40:38 AM
Agreed, so as time passes more and more of bitcoin is fading away with no word of any action or future plans.  It is begging to look more and more like there will be not bitfloor in the future.  Please someone tell me that is not the case but until then I will keep an eye out for the future blog of what action (or talk of action) do we do next those who were with bitfloor.

Signed,
Slowing losing patience

I have been in contact with various individuals discussing the future of bitfloor and finding a way to proceed. Updates cannot be posted until a decision is reached as I do not wish to spread misinformation. I can say that all my efforts are focused on keeping bitfloor alive. It takes time to speak to all of the interested parties and come up with a solution.


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 12, 2012, 12:19:38 PM
Agreed, so as time passes more and more of bitcoin is fading away with no word of any action or future plans.  It is begging to look more and more like there will be not bitfloor in the future.  Please someone tell me that is not the case but until then I will keep an eye out for the future blog of what action (or talk of action) do we do next those who were with bitfloor.

My ACH withdrawal has just been processed/received to the tune of $2000 USD. He's working on things.


Title: Re: bitfloor needs your help!
Post by: LoweryCBS on September 12, 2012, 12:25:05 PM
I have been in contact with various individuals discussing the future of bitfloor and finding a way to proceed. Updates cannot be posted until a decision is reached as I do not wish to spread misinformation. I can say that all my efforts are focused on keeping bitfloor alive. It takes time to speak to all of the interested parties and come up with a solution.

REALLY looking forward to the re-establishment of BitFloor. You'll be a bitcoin hero!

"I trust a man more who's failed before." - LoweryCBS

Please please please please float an equity offering on GLBSE


Title: Re: bitfloor needs your help!
Post by: whitslack on September 12, 2012, 02:08:18 PM
My ACH withdrawal has just been processed/received to the tune of $2000 USD. He's working on things.
My ACH withdrawal of ~$540 hit my bank account this morning, too.


Title: Re: bitfloor needs your help!
Post by: subject on September 12, 2012, 02:33:43 PM
Maybe something like this would help for round 2 of Bitfloor:

http://codeascraft.etsy.com/2012/09/11/announcing-the-etsy-security-bug-bounty-program/



Title: Re: bitfloor needs your help!
Post by: unclemantis on September 12, 2012, 04:50:15 PM
Agreed, so as time passes more and more of bitcoin is fading away with no word of any action or future plans.  It is begging to look more and more like there will be not bitfloor in the future.  Please someone tell me that is not the case but until then I will keep an eye out for the future blog of what action (or talk of action) do we do next those who were with bitfloor.

My ACH withdrawal has just been processed/received to the tune of $2000 USD. He's working on things.

A little slower than usual. I still have not gotten my ACH withdrawal as of yet. Starting to get the jitters again. I withdrew HALF of my USD via ACH this past Sunday. it is now Wednesday and still nothing.

I will contact support today.


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 12, 2012, 04:51:20 PM
I am getting the following message when trying to log in.

504 Gateway Time-out

The server didn't respond in time.


Title: Re: bitfloor needs your help!
Post by: ErebusBat on September 12, 2012, 06:10:08 PM
I am getting the following message when trying to log in.

504 Gateway Time-out

The server didn't respond in time.
Email support


Title: Re: bitfloor needs your help!
Post by: Rassah on September 12, 2012, 07:35:10 PM
My paltry $22.22 came back yesterday too.

If one of those options being discussed is a bond or investment, could others get in on that too? Or would it be a private deal?


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 12, 2012, 07:37:38 PM
Agreed, so as time passes more and more of bitcoin is fading away with no word of any action or future plans.  It is begging to look more and more like there will be not bitfloor in the future.  Please someone tell me that is not the case but until then I will keep an eye out for the future blog of what action (or talk of action) do we do next those who were with bitfloor.

My ACH withdrawal has just been processed/received to the tune of $2000 USD. He's working on things.

A little slower than usual. I still have not gotten my ACH withdrawal as of yet. Starting to get the jitters again. I withdrew HALF of my USD via ACH this past Sunday. it is now Wednesday and still nothing.

I will contact support today.

Roman replied to my support email. I should give it another day or so.


Title: Re: bitfloor needs your help!
Post by: peasant on September 12, 2012, 07:52:08 PM
I got mine in a timely manner when i did it. When is this exchange gonna open up again? The coins are building up and satoshi dice are getting your business at the moment.  :D


Title: Re: bitfloor needs your help!
Post by: joesdc on September 12, 2012, 08:23:04 PM
I have been in contact with various individuals discussing the future of bitfloor and finding a way to proceed. Updates cannot be posted until a decision is reached as I do not wish to spread misinformation. I can say that all my efforts are focused on keeping bitfloor alive. It takes time to speak to all of the interested parties and come up with a solution.

Any plan to re-pay the lost bitcoin? I see this as being an important way to regain the trust of the community. There are other exchanges that have not been compromised that work well, what incentive do I have with going with an exchange that lost so much BTC and has made 0 claims of repayment. I just don't see it being wise for the community to help bitfloor out until repayment is discussed. If there is no plan to repay lost BTC then the community should not back the rebuilding of bitfloor.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 12, 2012, 08:49:58 PM
I have been in contact with various individuals discussing the future of bitfloor and finding a way to proceed. Updates cannot be posted until a decision is reached as I do not wish to spread misinformation. I can say that all my efforts are focused on keeping bitfloor alive. It takes time to speak to all of the interested parties and come up with a solution.

Any plan to re-pay the lost bitcoin? I see this as being an important way to regain the trust of the community. There are other exchanges that have not been compromised that work well, what incentive do I have with going with an exchange that lost so much BTC and has made 0 claims of repayment. I just don't see it being wise for the community to help bitfloor out until repayment is discussed. If there is no plan to repay lost BTC then the community should not back the rebuilding of bitfloor.
You need to read between the lines in his post.  That's exactly what he's working on figuring out when he says "finding a way to proceed".


Title: Re: bitfloor needs your help!
Post by: CA Coins on September 12, 2012, 10:12:50 PM
Got around $900 USD back through ACH.  I am leaving some USD in the exchange and hoping Roman good luck in getting bitfloor back operational.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 13, 2012, 01:20:57 AM
I am leaving some USD in the exchange

If a creditor, whether it is someone who held a bitcoin balance or maybe an ISP, forces BitFloor to file for bankruptcy, your USDs are gone -- and probably will then go to the lawyers who will be paid first.

 - http://www.blakeleyllp.com/content/2011/05/02/a-proper-purpose-for-commencing-an-involuntary-bankruptcy-petition-preserving-a-preference-action
 
 - https://blog.bdo.com/index.php/2011/06/23/treatment-of-customer-deposits-after-a-retailer-files-for-bankruptcy/

If BitFloor finds investment capital and regains solvency, you can always add funds back into your account.  In the meantime though, don't think you are doing BitFloor a favor by not pulling every one of your USDs out.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 13, 2012, 06:19:28 AM
You need to read between the lines in his post.  That's exactly what he's working on figuring out when he says "finding a way to proceed".
[/quote]

I would prefer he actually say it than just assume it. I'm not asking for a specific on how or when just a simple "and repay stolen BTC" would be enough.


Title: Re: bitfloor needs your help!
Post by: subject on September 13, 2012, 09:25:31 AM
I would prefer he actually say it than just assume it. I'm not asking for a specific on how or when just a simple "and repay stolen BTC" would be enough.

He also said he doesn't want to spread misinformation before anything is 100% assured.
I'm certain he's trying his hardest to get the site back operational and to pay back all that was lost. He's simply covering his ass just a little (since we all know how people can get on these forums).


Title: Re: bitfloor needs your help!
Post by: miscreanity on September 14, 2012, 04:05:01 AM
I am getting the following message when trying to log in.

504 Gateway Time-out

The server didn't respond in time.

I was getting that error as well. Using a different connection, it worked fine.


Title: Re: bitfloor needs your help!
Post by: BitcoinForLiberty on September 14, 2012, 07:22:14 PM
I noticed at 9:00 EST this morning that bitfloor could no longer be logged in to -- there was simply a message saying it was down for maintenance. An hour or two later I noticed my browser timed out when I attempted to load the homepage. This is still happening. I would like an update from Shtylman as to what is going on with the site. Makes me wonder if this is the new permanent state of bitfloor. Hope not.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 14, 2012, 08:34:25 PM
I noticed at 9:00 EST this morning that bitfloor could no longer be logged in to -- there was simply a message saying it was down for maintenance. An hour or two later I noticed my browser timed out when I attempted to load the homepage. This is still happening. I would like an update from Shtylman as to what is going on with the site. Makes me wonder if this is the new permanent state of bitfloor. Hope not.

I am migrating the bitfloor servers. As the migration to new servers takes effect you will see the website again. This should take no more than 24 hours before you can access the site again.


Title: Re: bitfloor needs your help!
Post by: joesdc on September 18, 2012, 03:25:40 PM
I would prefer he actually say it than just assume it. I'm not asking for a specific on how or when just a simple "and repay stolen BTC" would be enough.

He also said he doesn't want to spread misinformation before anything is 100% assured.
I'm certain he's trying his hardest to get the site back operational and to pay back all that was lost. He's simply covering his ass just a little (since we all know how people can get on these forums).

So basically I need the help of the community to get bitfloor up and running but I don't feel comfortable giving you even the slightest hint at if we plan to paying the stolen bitcoin back. I'm ok with him not being specific to how much or how long or any of those kind of details a simple "make right what was lost" would be enough. There is a difference between not trying to spread misinformation and avoiding something altogether. The response from the community should be we don't feel comfortable supporting you until you have made it clear accounts will be repaid.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 18, 2012, 03:37:22 PM
I would prefer he actually say it than just assume it. I'm not asking for a specific on how or when just a simple "and repay stolen BTC" would be enough.

He also said he doesn't want to spread misinformation before anything is 100% assured.
I'm certain he's trying his hardest to get the site back operational and to pay back all that was lost. He's simply covering his ass just a little (since we all know how people can get on these forums).

So basically I need the help of the community to get bitfloor up and running but I don't feel comfortable giving you even the slightest hint at if we plan to paying the stolen bitcoin back. I'm ok with him not being specific to how much or how long or any of those kind of details a simple "make right what was lost" would be enough. There is a difference between not trying to spread misinformation and avoiding something altogether. The response from the community should be we don't feel comfortable supporting you until you have made it clear accounts will be repaid.

It is entirely possible bitfloor will go bankrupt.  It needs new investors (and new capital) to restart.  Those investors may (almost certainly will) have requirements and conditions.  Making promises (even open ended and vague) is counter productive. 


Quote
a simple "make right what was lost" would be enough
It is never that simple.  bitfloor, Inc doesn't have the funds to make right.  Period.  To make it right requires attracting new capital. Making promises before you have the ability to execute them is just false hope.  I am fairly confident that bitfloor will attract the capital it needs.  I have even indicated I am willing to provide some of that capital however "fixing" a loss like this is tricky.  The deal has to make sense for current creditors, it has to make sense for Roman, it has to make sense from a business perspective (being competitive, properly capitalized), and it has to make sense for investors.

Roman is doing the right thing IMHO.  That doesn't mean creditors will get paid, it must means blabbing on the forum makes it LESS LIKELY creditors will get paid.


Title: Re: bitfloor needs your help!
Post by: dreamwatcher on September 18, 2012, 04:27:46 PM
I am not sure if Bankruptcy is an option anymore, his creditors that happen to have USD in their accounts have been paid back AFTER the incident.

If he declares Bankruptcy now, a bankruptcy judge might consider that "favoring certain creditors".

What bothers me even more, and not just in the Bitfloor incident, being a business person myself I know the important of INSURANCE when running a business.

It seems to me a large chunk of these BTC business that get "hacked" do not even have basic business insurance policies. Some of these business are even properly registered in there respective states under some corporate structure and I know in some jurisdictions it is REQUIRED to carry a certain level of protection.

Most professionals are required to carry insurance, and you know damm well that any smart successful business is going to cover their ass, required by law or not.

Why does the BTC business community feel no need to carry it?




Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 18, 2012, 04:44:46 PM
Let me know when you find an insurance company willing to replace lost/stolen BTC.  Bankruptcy is always an option.

While a judge "may" rule against USD account holders that doesn't prevent bitfloor from entering bankruptcy or being liquidated.  I would also point out no court has (at least to date) recognized BTC owed as a legal claim.  So it is a huge longshot for BTC creditors to seek compensation in bankruptcy.  They would need a judge to both find their claim valid AND clawback USD balances paid out.  Baring that you can't get blood from a stone, my understanding is Bitfloor has no significant assets.

IMHO (and I don't speak for Roman or bitfloor) the only plausible scenario where bitfloor returns to operation and creditors receive compensation is a capital injection.  At this point without knowing what requirements new investors may have Roman can only hurt the chances of that happening by blabbing on some forum.


Title: Re: bitfloor needs your help!
Post by: dancupid on September 18, 2012, 05:03:27 PM
Why is it necessary for any exchange to hold bitcoins?
A zero confirmation transaction is almost immediate - so it can be used for immediate (though pending) trades.

I hold the private keys to a bitcoin address, I associate this address with an order, and place an order. Local software (in my browser or elsewhere) initiates the trade when the correct conditions are met. The exchange gives me fiat in my account after I send bitcoins, and confirms it after 6 confirmations.

The whole point of bitcoin is that we can maintain control.
There doesn't seem to me any reason why people trading bitcoins for fiat cannot maintain control over those bitcoins until the actual moment of exchange.


Title: Re: bitfloor needs your help!
Post by: thebaron on September 18, 2012, 05:12:45 PM
There doesn't seem to me any reason why people trading bitcoins for fiat cannot maintain control over those bitcoins until the actual moment of exchange.

Like most things, laziness plays a big factor in why people do what they do. An online wallet is also a lot more portable and convenient.

I do understand why "day traders" leave their BTC/cash in an exchange, though. Internal database queries/writes are much faster than the peer-to-peer Bitcoin network. Trade execution timing is everything to those folks.


Title: Re: bitfloor needs your help!
Post by: Rassah on September 18, 2012, 05:31:41 PM
I hold the private keys to a bitcoin address, I associate this address with an order, and place an order. Local software (in my browser or elsewhere) initiates the trade when the correct conditions are met. The exchange gives me fiat in my account after I send bitcoins, and confirms it after 6 confirmations.

Trolls manipulate Bitcoin prices by placing lots of orders they never follow through on?


Title: Re: bitfloor needs your help!
Post by: dreamwatcher on September 18, 2012, 05:36:17 PM
Let me know when you find an insurance company willing to replace lost/stolen BTC.  Bankruptcy is always an option.

While a judge "may" rule against USD account holders that doesn't prevent bitfloor from entering bankruptcy or being liquidated.  I would also point out no court has (at least to date) recognized BTC owed as a legal claim.  So it is a huge longshot for BTC creditors to seek compensation in bankruptcy.  They would need a judge to both find their claim valid AND clawback USD balances paid out.  Baring that you can't get blood from a stone, my understanding is Bitfloor has no significant assets.

IMHO (and I don't speak for Roman or bitfloor) the only plausible scenario where bitfloor returns to operation and creditors receive compensation is a capital injection.  At this point without knowing what requirements new investors may have Roman can only hurt the chances of that happening by blabbing on some forum.

How about the value of lost data, if one does not feel insurance would directly cover BTC? One can also get insurance to cover just about anything, I have read about some really crazy stuff being insured (I remember reading about people's asses being insured after winning a 'most perfect butt' contest...LOL)

I also do not think it would be a "long shot" to prove BTC as an asset. Assets do not need to be official currency and most times are not.

A good lawyer would just have to point to Mt. Gox or BCT-E and show they are subject to AML/KYC laws. If BTC are valueless, how could it be used to launder money?

The answer: Of course BTC has value and thus is an asset.

Just because nobody has brought a proper case in front of a court (That has influence--small claims cases generally are not precedent setters), does not mean it has been decided that legally BTC has no value. Again the fact Mt. Gox has to follow AML/KYC laws says quite the opposite.

I am not trying to start an argument, and I have no idea which way a judge would rule, but to claim that BTC is valueless would be a terrible point to rely on in a court case as it could be easily shot down.

Edit: Added "Assets do not need to be"


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on September 18, 2012, 06:12:28 PM
... Assets do not need to be official currency and most times are not. ...If BTC are valueless ... does not mean it has been decided that legally BTC has no value ... would be a terrible point to rely on in a court case as it could be easily shot down

Bunch of strawmen and false claims.  Next time respond to what I actually wrote.



Title: Re: bitfloor needs your help!
Post by: qxzn on September 19, 2012, 04:33:43 AM
Why is it necessary for any exchange to hold bitcoins?
A zero confirmation transaction is almost immediate - so it can be used for immediate (though pending) trades.

I hold the private keys to a bitcoin address, I associate this address with an order, and place an order. Local software (in my browser or elsewhere) initiates the trade when the correct conditions are met. The exchange gives me fiat in my account after I send bitcoins, and confirms it after 6 confirmations.

The whole point of bitcoin is that we can maintain control.
There doesn't seem to me any reason why people trading bitcoins for fiat cannot maintain control over those bitcoins until the actual moment of exchange.


Interesting. It's kind of like in the real world financial markets, where the trade is made on paper, and then when it "clears" a few days later, that's when the funds and securities actually change hands. It's a neat idea. But as another post points out, how to ensure people follow through funding their trades? (and most important, ensure that they follow through on the losing trades as well as the winning ones :)


Title: Re: bitfloor needs your help!
Post by: dancupid on September 19, 2012, 05:08:02 AM
Quote

Trolls manipulate Bitcoin prices by placing lots of orders they never follow through on?

Quote

Interesting. It's kind of like in the real world financial markets, where the trade is made on paper, and then when it "clears" a few days later, that's when the funds and securities actually change hands. It's a neat idea. But as another post points out, how to ensure people follow through funding their trades? (and most important, ensure that they follow through on the losing trades as well as the winning ones :)

People are free to pull out of any trade at any time they like - people can already do this on mt.gox, just by cancelling the order if they see a shift in the market they don't like, or change their minds.
Once the order is confirmed on the block chain the exchange will credit the account of the bitcoin seller in fiat.
The mechanism of the trade would be dealt with automatically by the browser/software linked to the exchange - the exchange would still hold the fiat currency (which they can hold much more safely than bitcoins). They would use the block chain to confirm the trade has occurred.
If the trade hasn't occurred, then it's the same as someone cancelling an order in the orderbook just before the trade takes place.
The seller could attempt a double spend - but this would be akin to someone simply cancelling the order. They'd only have a few seconds to make the decision anyway.
After 6 confirmations - the trade would be fully initiated by the exchange. At zero it would be assumed to have occurred, but held in a pending state.
The software and exchange would need to manage the orderbook to prevent 2 people selling bitcoins simultaneously to the same buyer - but they already have to do this.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 19, 2012, 07:47:08 AM
- the exchange would still hold the fiat currency (which they can hold much more safely than bitcoins). They would use the block chain to confirm the trade has occurred.
If the trade hasn't occurred, then it's the same as someone cancelling an order in the orderbook just before the trade takes place.

If you are describing where the transaction is started when the bitcoins are sent, then you have the possibility that two or more people will send coins attempting to sell to the same buy order.   

If instead you have it where the transaction starts with an electronic notice and then followed is a transaction through the blockchain then you have the legitimate scenario where the order can be removed from the pool without payment.

But there's probably ways to deal with this ... like enough of a deposit required so that if you don't settle after transmitting intent then a fee is assessed against your deposited funds. 


Title: Re: bitfloor needs your help!
Post by: markm on September 19, 2012, 08:22:32 AM
Everyone who wants to buy could send their actual transaction to the exchange instead of to the p2p network.

For example for each offer of fiat for sale, the exchange can publish a bitcoin address to send offers for that block of fiat to.

Everyone who sends an offer can watch that address, waiting to see it receive coins.

That address could in fact be the actual address of the seller of the fiat, not an address the exchange controls.

When you see that some offer other than yours was published sending bitcoins to that address, you know your offers was not the one accepted, so you send your offered coins somewhere else, that is, to another address of your own.

Once a block is published containing a payment to the offer address, you can start counting blocks for how confident you are that the offer published by the exchange really is going to go through.

You can also watch to see if the exchange publishes your offer in addition to someone else's offer, and to see when your coins not accepted do make it safely back to you.

(You need to sweep the address(es) you sent the offer from if the offer is not accepted, to minimise the window of time during which the exchange could accept multiple offers for the same block of fiat).

There are more-sophisticated things that could be done with multiple signature required transactions and such too probably of course.

-MarkM-


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 19, 2012, 05:12:45 PM
I would prefer he actually say it than just assume it. I'm not asking for a specific on how or when just a simple "and repay stolen BTC" would be enough.

He also said he doesn't want to spread misinformation before anything is 100% assured.
I'm certain he's trying his hardest to get the site back operational and to pay back all that was lost. He's simply covering his ass just a little (since we all know how people can get on these forums).

So basically I need the help of the community to get bitfloor up and running but I don't feel comfortable giving you even the slightest hint at if we plan to paying the stolen bitcoin back. I'm ok with him not being specific to how much or how long or any of those kind of details a simple "make right what was lost" would be enough. There is a difference between not trying to spread misinformation and avoiding something altogether. The response from the community should be we don't feel comfortable supporting you until you have made it clear accounts will be repaid.
I just saw this, and thought you might like to see this as well.  I am not sure why he tells the media about it, and not us, but it's still a mention of the information we were looking for either way.

Quote
"Given the amount of money involved it will take time to solve these problems and find ways to pay people back," he said, adding that most of the currency traders who used Bitfloor were sticking with him.
http://www.bbc.com/news/technology-19633980


Title: Re: bitfloor needs your help!
Post by: Joe200 on September 20, 2012, 01:44:31 PM
Hi guys,

I had an idea on how to help stop major thieves, like this one. The bitfloor thief has still not spent the coins, so there is still a chance to do something about it.

Here is the idea: https://bitcointalk.org/index.php?topic=110749.0 Please comment!

tnx


Title: Re: bitfloor needs your help!
Post by: unclemantis on September 20, 2012, 05:34:01 PM
I performed an ACH last week. That went fine. I performed an ACH this past Sunday and it has been 4 days. I just sent an email to support.


Title: Re: bitfloor needs your help!
Post by: Inaba on September 20, 2012, 06:39:20 PM
Roman has been at the Bitcoin Conference, that may have played a part in the delay.  I don't know what's up between Monday and today though.  

Although I have to say after talking to Roman this weekend in person, I'm much more comfortable with the whole situation.  I'm not saying I like it or that there's excuses for a lack of security practices on the bitcoin hotwallet, but I am comfortable that it is not scam on his part.  

I think if there's any way to salvage this properly, Roman will be working on it or trying to make it happen. Hopefully it will work out and he won't prove me wrong.  Although I did want to call him Carrot Top a couple times, but I figured that would be rude :)  I kid... I kid...



Title: Re: bitfloor needs your help!
Post by: unclemantis on September 20, 2012, 07:43:23 PM
Roman has been at the Bitcoin Conference, that may have played a part in the delay.  I don't know what's up between Monday and today though. 

Although I have to say after talking to Roman this weekend in person, I'm much more comfortable with the whole situation.  I'm not saying I like it or that there's excuses for a lack of security practices on the bitcoin hotwallet, but I certainly have absolutely no doubts about this being some sort of scam on his part. 

I think if there's any way to salvage this properly, Roman will be working on it or trying to make it happen. Hopefully it will work out and he won't prove me wrong.  Although I did want to call him Carrot Top a couple times, but I figured that would be rude :)  I kid... I kid...



I emailed support and he replied back. He just now processed it.

I am sure he is consumed with a lot of EXTRA duties.

All is well :)



Title: Re: bitfloor needs your help!
Post by: BitcoinForLiberty on September 21, 2012, 02:57:51 PM
I noticed bitfloor seems to be up and running fully this morning, with the exception being that BTC balances are on hold. I am surprised to see no info given by Roman about this change and would like an update from him. Is there a plan for paying back BTC balances that are currently on hold?


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 21, 2012, 03:12:13 PM
We just need to push to vol to 8 million and it will be taken care of. GO! TRADE LIKE THE WIND!


Title: Re: bitfloor needs your help!
Post by: BitcoinForLiberty on September 21, 2012, 03:24:59 PM
Just to be clear I can't yet verify that trades are happening, but there are bids and asks posted in the order book. I just transferred a small fraction of a BTC in to see if I can sell it as a test. Will report back when the funds clear.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 21, 2012, 03:29:08 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.


Title: Re: bitfloor needs your help!
Post by: LoweryCBS on September 21, 2012, 03:37:25 PM
Rock on, dude.

You pull through this and you'll be a Bitcoin Hero!


Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.


Title: Re: bitfloor needs your help!
Post by: BitcoinForLiberty on September 21, 2012, 03:45:35 PM
Here's a quote from Roman from the Google plus blog:

"Your balance as of the theft will remain on hold and be released in parts as we begin to recover funds to pay back balances. As funds are available for repayment, they will be dispersed on a pro-rated basis (i.e. if 5% of the funds are available for repayment then 5% of your original pre-theft balance will be unheld and immediately available for trading or withdrawal)."

What percentage or portion of revenues will be allocated to BTC repayment?


Title: Re: bitfloor needs your help!
Post by: BCB on September 21, 2012, 03:46:03 PM
shtylman

Good to hear.  Good luck.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 21, 2012, 03:50:03 PM
The important bits:

Quote
Your balance as of the theft will remain on hold and be released in parts as we begin to recover funds to pay back balances. As funds are available for repayment, they will be dispersed on a pro-rated basis (i.e. if 5% of the funds are available for repayment then 5% of your original pre-theft balance will be unheld and immediately available for trading or withdrawal).

Quote
Bitcoin funds for repayment will be purchased using revenue from fees. This will ensure that as Bitfloor grows I am able to continue operation to recover the stolen funds over time. I am also pursuing investment from various parties to speed up the fund recovery process however felt that keeping the exchange closed for too long was only doing more damage.

That's satisfactory to me!  Thanks for the update, and for working hard to keep the exchange alive and pay everyone back Roman!


Title: Re: bitfloor needs your help!
Post by: bbit on September 21, 2012, 03:55:09 PM
woo hoo! ;D


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 21, 2012, 04:14:14 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...


Title: Re: bitfloor needs your help!
Post by: DigitalHermit on September 21, 2012, 04:19:58 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Awesome! So glad to see you are back in business.


Title: Re: bitfloor needs your help!
Post by: Severian on September 21, 2012, 04:24:54 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

My thirty cents is still there. I'll be sending folks your way.


Title: Re: bitfloor needs your help!
Post by: mufa23 on September 21, 2012, 04:50:05 PM
Awesome! I've already gotten tired of using Gox the past couple of weeks. Just sent some funds in, and will resume regular trading.


Title: Re: bitfloor needs your help!
Post by: HDSolar on September 21, 2012, 04:58:30 PM
Awesome! I've already gotten tired of using Gox the past couple of weeks. Just sent some funds in, and will resume regular trading.
This is great news and what we all needed to see.  As soon as I have some coins I will be working with you again (later in the week).



Title: Re: bitfloor needs your help!
Post by: DannyHamilton on September 21, 2012, 05:50:11 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.
Shtylman,

Any thoughts on creating a secondary market where "on hold" BTC can be bought/sold?  I'd be willing to purchase some "on hold" BTC from those who might be in a hurry to cash out if I could get them at an exchange rate that is slightly more favorable than the current rate for BTC that are not "on hold".  If you could create a way for these BTC to be identified and traded, then you would allow those customers of yours who have fears or are in urgent need to cash out to transfer the BTC to those who are just hoarding and have no immediate need.  This would significantly improve customer satisfaction.

I'd even guess that buyers of "on hold" BTC would be willing to pay a transaction fee to the exchange in the form of "on hold" BTC (which would remove those BTC from the pool of BTC that the exchange would need to repay).

(perhaps I should send this question in an email to ensure Shtylman sees it).

EDIT: As of 2013-04-17 BitFloor has ceased all operations.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 21, 2012, 05:53:02 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.
Shtylman,

Any thoughts on creating a secondary market where "on hold" BTC can be bought/sold?  I'd be willing to purchase some "on hold" BTC from those who might be in a hurry to cash out if I could get them at an exchange rate that is slightly more favorable than the current rate for BTC that are not "on hold".  If you could create a way for these BTC to be identified and traded, then you would allow those customers of yours who have fears or are in urgent need to cash out to transfer the BTC to those who are just hoarding and have no immediate need.  This would significantly improve customer satisfaction.

I'd even guess that buyers of "on hold" BTC would be willing to pay a transaction fee to the exchange in the form of "on hold" BTC (which would remove those BTC from the pool of BTC that the exchange would need to repay).

(perhaps I should send this question in an email to ensure Shtylman sees it).
+1 to this - I would welcome such a market.


Title: Re: bitfloor needs your help!
Post by: jgarzik on September 21, 2012, 06:06:32 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.
Shtylman,

Any thoughts on creating a secondary market where "on hold" BTC can be bought/sold?  I'd be willing to purchase some "on hold" BTC from those who might be in a hurry to cash out if I could get them at an exchange rate that is slightly more favorable than the current rate for BTC that are not "on hold".  If you could create a way for these BTC to be identified and traded, then you would allow those customers of yours who have fears or are in urgent need to cash out to transfer the BTC to those who are just hoarding and have no immediate need.  This would significantly improve customer satisfaction.

I'd even guess that buyers of "on hold" BTC would be willing to pay a transaction fee to the exchange in the form of "on hold" BTC (which would remove those BTC from the pool of BTC that the exchange would need to repay).

(perhaps I should send this question in an email to ensure Shtylman sees it).

That is an excellent suggestion.  Various forms of debt are sold, with varying risks as to whether or not that debt will be repaid.  It has value.



Title: Re: bitfloor needs your help!
Post by: shtylman on September 21, 2012, 06:14:11 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.
Shtylman,

Any thoughts on creating a secondary market where "on hold" BTC can be bought/sold?  I'd be willing to purchase some "on hold" BTC from those who might be in a hurry to cash out if I could get them at an exchange rate that is slightly more favorable than the current rate for BTC that are not "on hold".  If you could create a way for these BTC to be identified and traded, then you would allow those customers of yours who have fears or are in urgent need to cash out to transfer the BTC to those who are just hoarding and have no immediate need.  This would significantly improve customer satisfaction.

I'd even guess that buyers of "on hold" BTC would be willing to pay a transaction fee to the exchange in the form of "on hold" BTC (which would remove those BTC from the pool of BTC that the exchange would need to repay).

(perhaps I should send this question in an email to ensure Shtylman sees it).

That is an excellent suggestion.  Various forms of debt are sold, with varying risks as to whether or not that debt will be repaid.  It has value.



Wanted to say that I appreciate the suggestion and have taken it under consideration as a way to handle the stolen fund balances. I think that if done correctly it can be a viable way to shift the burden.


Title: Re: bitfloor needs your help!
Post by: jwzguy on September 21, 2012, 06:44:36 PM
Just wanted to say that I would absolutely pay for  slightly discounted "on hold" btc if you can set up some kind of secondary exchange.


Title: Re: bitfloor needs your help!
Post by: TangibleCryptography on September 21, 2012, 09:02:41 PM
Sell bitfloor BTC debt to improve liquidity:
https://bitcointalk.org/index.php?topic=111918


Title: Re: bitfloor needs your help!
Post by: DigitalHermit on September 21, 2012, 09:21:01 PM
Just wanted to say that I would absolutely pay for  slightly discounted "on hold" btc if you can set up some kind of secondary exchange.

Me too...On a completely different topic the Bitfloor.com site is down again.  :(


Title: Re: bitfloor needs your help!
Post by: jgarzik on September 21, 2012, 09:44:52 PM
Sell bitfloor BTC debt to improve liquidity:
https://bitcointalk.org/index.php?topic=111918

Just posted an offer in that thread.

Whether or not debt resale occurs, a recommendation:

An order of restitution should be clearly defined, e.g. "by account number of original debtholder, in numerical order" (random/fair) or "by account, sorted in descending order by size of debt" (big first, encouraging sale of this debt) or "smallest debt first" (help the little guy) or "by account creation time" (reward early adopters)

This is necessary and prudent if the debt repayment will occur over time, rather than all at once.  Necessarily, reality dictates that some must wait longer than ones for repayment.

EDIT Nevermind, I see you posted something on G+ about this ("if 5% of the funds are available for repayment then 5% of your original pre-theft balance will be unheld")


Title: Re: bitfloor needs your help!
Post by: TangibleCryptography on September 21, 2012, 09:51:16 PM
My understanding from Roman prior statements is that debt repayment is being done on a share basis.  i.e. if 24,000 BTC are owed and Bitfloor makes a repayment of 1,000 BTC then all creditors would be repaid 4.17% of their balance (1,000 / 24,000). Given that we are owed 200 of ~24,000 BTC our account should receive roughly 0.83% of each payments made. Roman it would be useful to know the exact amount owed all BTC creditors.

A shared repayment is the only equitable arrangement.  Paying creditors in a preferential order would imply some debt is senior to others, and no such seniority exists.  When TheBitMan asks our company to facilitate repayment of his creditors we repaid each creditor their % share of the total amount owed.  It is the same method a court of law would use to handle repayment under say Chapter 13 bankruptcy.  


Title: Re: bitfloor needs your help!
Post by: BCB on September 21, 2012, 10:45:31 PM
+1 for TangibleCryptography dept repayment input.

While the TheBitman debt was a fraction of the current Bitfloor debt, TC's input and effort in arranging and handling payment for all the creditors equitably was instrumental in creating a successful result for all involved.

shtylman, while I'm not suggesting TC handl your dept,  it would be wise to at lease consider TC's input.   I think it also bodes well for us all when the community can work together to solve these problems.



Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 21, 2012, 11:04:49 PM
I get this message trying to withdraw my BTC.

oops! something went wrong
We have been notified and will look into the issue.


This was my fault 100%  :-[

Once I filled out the withdraw page correctly the withdraw was processed immediately.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 22, 2012, 12:25:48 AM
I get this message trying to withdraw my BTC.

 :-[ :'(

oops! something went wrong
We have been notified and will look into the issue.

Given the fact that all customer deposits of BTC are now held in an offline (cold) wallet, and the online (hot) wallet contains only Roman's own funds with which to fulfill BTC withdrawals, it's likely that the online wallet has bottomed out. Perhaps a lot of users who had USD still sitting on the exchange when it reopened decided to buy BTC and withdraw it. That would have put a strain on the online wallet. Roman will have to refill it from the offline wallet.

The error message could be better.


Title: Re: bitfloor needs your help!
Post by: Otoh on September 22, 2012, 02:41:53 PM
I haven't used bitfloor as yet but once it is running smoothly & generating fees to help repay the stolen coins then I definitely plan on switching some business to there especially if/once there is outside investment & expertise being added.


Title: Re: bitfloor needs your help!
Post by: BCB on September 22, 2012, 05:13:36 PM
A proposal:

https://bitcointalk.org/index.php?topic=112069.new#new


Title: Re: bitfloor needs your help!
Post by: eldentyrell on September 22, 2012, 05:15:06 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

I have concerns about the new API, but this thread has enough traffic already:

  https://bitcointalk.org/index.php?topic=112070.msg1212462 (https://bitcointalk.org/index.php?topic=112070.msg1212462)


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 23, 2012, 09:19:08 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...


Title: Re: bitfloor needs your help!
Post by: whitslack on September 27, 2012, 10:13:09 PM
Bitfloor's web site is having gateway timeout errors now. Repeat attack? Seems similar to the symptoms last time. I'm going to pull out my BTC immediately if it comes back up, just to be safe. I had the opportunity to do that last time, but I didn't. If this actually is a second attack and it's successful, I'm finished with Bitfloor.

Interestingly, the Bitfloor API still appears to be functioning.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on September 27, 2012, 10:47:47 PM
Bitfloor's web site is having gateway timeout errors now. Repeat attack? Seems similar to the symptoms last time. I'm going to pull out my BTC immediately if it comes back up, just to be safe. I had the opportunity to do that last time, but I didn't. If this actually is a second attack and it's successful, I'm finished with Bitfloor.

Interestingly, the Bitfloor API still appears to be functioning.
To be clear, this appears to be happening upon attempted login.


Title: Re: bitfloor needs your help!
Post by: Ocean6 on September 27, 2012, 11:30:58 PM
7:31 pm East Coast US

Can't login

If I ever get back in, all BTC coming out


Title: Re: bitfloor needs your help!
Post by: Otoh on September 28, 2012, 12:13:56 AM
5 days ago I applied to enable ACH withdrawals for my account, I sent my bank details & ID, but so far have received no acknowledgement or response, I haven't deposited any funds as yet or started trading as I wanted this to be in place first - along with smooth running of the site & evidence that all would now be likely well to trust funds here, also site is down for me.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 28, 2012, 12:41:28 AM
Using the API, I was able to cancel all of my outstanding orders and withdraw my entire BTC balance. The transaction shows up on BlockChain.info now, so I'd guess it'll confirm.

If this is another hack, they haven't emptied out the wallet yet.

EDIT: It has one confirmation now.


Title: Re: bitfloor needs your help!
Post by: Otoh on September 28, 2012, 12:46:18 AM
This is perhaps irrelevant, I am 100% non techy, when I did try to log in the site seemed to want to connect to some port of mine which I denied, maybe it's just normal & harmless but I don't remember it trying to do this before, pse excuse my newbness of what that may be about or nothing , after it went to 504 timed out.


Title: Re: bitfloor needs your help!
Post by: whitslack on September 28, 2012, 05:57:37 AM
Still down. This is not helping Bitfloor's already sullied image.


Title: Re: bitfloor needs your help!
Post by: shtylman on September 28, 2012, 07:58:57 AM
I apologize for the downtime. It was the result of a minor issue with the website. The API, trading, withdrawal, deposit, and other services were not affected.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on September 28, 2012, 01:07:52 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...

Please?


Title: Re: bitfloor needs your help!
Post by: BCB on September 28, 2012, 01:30:18 PM
Sorry shtylman.  With the downtime yesterday and the lack of transparency I just cashed out.  It was a good run while it lasted.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on September 28, 2012, 03:40:20 PM
I created a thread to serve as an exchange available to those with BTCs that are still "on hold" following the security breach earlier this month.  

That thread can be used to list offers to sell and for potential buyers to express their interest as well.

Recently there was a sale of BTC debt owed by BitFloor, Inc. to one of its accountholders whose bitcoins are being held by the exchange and thus not available for withdrawal.

This thread is for others with BTCs on hold at BitFloor to list their offers and for buyers to express their interest.

Here was the previous sale.

[...]

 - http://bitcointalk.org/index.php?topic=113547.0


Title: Re: bitfloor needs your help!
Post by: mufa23 on September 29, 2012, 07:53:29 AM
I can login. I guess the problem is over?


Title: Re: bitfloor needs your help!
Post by: whitslack on September 30, 2012, 02:16:57 PM
I can login. I guess the problem is over?
The symptom is over. We have no way of knowing whether the problem has been solved since Roman hasn't been forthcoming about what's going on, either here or on the Bitfloor blog (http://blog.bitfloor.com/).


Title: Re: bitfloor needs your help!
Post by: Tuxavant on September 30, 2012, 03:30:11 PM
Received via email 2 days ago.

Quote
Received: by 10.68.43.34 with HTTP; Fri, 28 Sep 2012 01:30:35 -0700 (PDT)
Date: Fri, 28 Sep 2012 09:30:35 +0100
Subject: Re: bitfloor timeouts
From: Roman Shtylman
To: me

Apologies for the downtime. There was a minor website issue (other
services like API, deposit, withdrawal, etc) were unaffected. The
website is back online now. No status update was given as I was not
awake during the downtime and fixed the issue as soon as I woke up.

cheers,
~Roman


Title: Re: bitfloor needs your help!
Post by: whitslack on October 02, 2012, 01:22:15 AM
On successive reconnection attempts by my bot (which uses an exponential back-off):

Code:
java.io.IOException: Error writing to server
java.io.IOException: Error writing to server
javax.net.ssl.SSLException: Connection has been shutdown: javax.net.ssl.SSLException: java.net.SocketException: Connection reset
Caused by: javax.net.ssl.SSLException: java.net.SocketException: Connection reset
Caused by: java.net.SocketException: Connection reset
java.io.IOException: Error writing to server
java.net.ConnectException: Connection refused
java.net.ConnectException: Connection timed out
java.net.ConnectException: Connection timed out
java.net.ConnectException: Connection timed out
java.net.ConnectException: Connection timed out
java.net.ConnectException: Connection timed out
java.net.NoRouteToHostException: No route to host

Ouch. :(

Why is Bitfloor so unstable, even with scant traffic?


Title: Re: bitfloor needs your help!
Post by: TheButterZone on October 02, 2012, 01:33:37 AM
Crazy number of executions today...


Title: Re: bitfloor needs your help!
Post by: whitslack on October 02, 2012, 02:53:26 AM
Crazy number of executions today...
Yeah, I know. I was responsible for several dozen of those. ;)


Title: Re: bitfloor needs your help!
Post by: toffoo on October 02, 2012, 03:39:33 AM
bitfloor, we need your help!

http://www.downforeveryone.com/downforeveryone-https/result.php?url=bitfloor.com


Quote
Checking "down or not" status for https://bitfloor.com ...

Hey, it's not just you! https://bitfloor.com looks down from here.
Of course, we can't be sure about every other location, but at least it's not accessible from here (Brea, California - United States) right now.


Title: Re: bitfloor needs your help!
Post by: shtylman on October 02, 2012, 07:54:44 AM
Apologies for the site downtime today. It was cased by a crash on the web and API server. I have brought all services back up and posted about the outage on the bitfloor blog. In the future, serious downtime issues will always be mentioned on the blog.


Title: Re: bitfloor needs your help!
Post by: mufa23 on October 02, 2012, 08:04:57 AM
Sounds good. The recent down times have been getting me worried.


Title: Re: bitfloor needs your help!
Post by: shtylman on October 02, 2012, 08:42:59 AM
Sounds good. The recent down times have been getting me worried.

Understandable given what has happened in the past. However, I do want to stress that the issues have all been separate incidents and in no way related to any sort of compromise or attack on the servers. As mentioned in the previous post (and per the sentiment expressed by my users), serious server downtime will always be mentioned on our blog as well as our twitter account (@bitfloor) as soon as possible.


Title: Re: bitfloor needs your help!
Post by: Otoh on October 02, 2012, 11:04:45 AM
Hi,

It's been 9 days now since I emailed support to apply for ACH withdrawal status to be set up on my account with you, I sent you my full bank account details plus photo of my ID, but so far with no acknowledgment, no reply, no response to my post in your thread asking after this & the ACH has not been enabled on my account as yet.

Copied to your thread & would appreciate an update, thanks.

Otoh

Edit PS - I've just bought 800 coins on Gox that could/might have been done on your exchange otherwise, which would at least have made a few coins for the compensation fund of those who had theirs stolen from you. Just checked - not much Ask volume on BitFloor atm so maybe it would have been just a few unless there was hidden interest waiting for Bids.


Title: Re: bitfloor needs your help!
Post by: whitslack on October 02, 2012, 01:13:39 PM
Quote
The outage was due to  misbehavior on the server running the website and affected the website and api access.

Thanks for the attempt at transparency, but this is too vague. What was the problem? How did you correct it? You're on the Bitcoin Forum; you can get technical with us. Humor us. We need to want to trust that you know what you're doing.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on October 02, 2012, 01:16:48 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...

Please?

New security continues to be unverified...


Title: Re: bitfloor needs your help!
Post by: fbastage on October 02, 2012, 02:22:08 PM
serious downtime issues will always be mentioned on the blog.

blog? I can't find any. looked on site, google search, your bitcointalk profile.  could you link to it?


Title: Re: bitfloor needs your help!
Post by: whitslack on October 02, 2012, 02:56:06 PM
blog? I can't find any. looked on site, google search, your bitcointalk profile.  could you link to it?
Intuitively, it's:
http://blog.bitfloor.com/


Title: Re: bitfloor needs your help!
Post by: toffoo on October 02, 2012, 05:39:20 PM
blog? I can't find any. looked on site, google search, your bitcointalk profile.  could you link to it?
Intuitively, it's:
http://blog.bitfloor.com/

That link actually loads nothing for me (just reloads https://bitfloor.com) but https://blog.bitfloor.com looks like it redirects to: https://plus.google.com/109620439233076225324/posts

... serious server downtime will always be mentioned on our blog as well as our twitter account (@bitfloor) as soon as possible.

You've made two tweets lifetime (one of which being yesterday's ex post facto downtime acknowledgement) and have have 11 total followers.  Maybe you should actually start using twitter a bit more before we rely on it for downtime announcements.

Hi,

It's been 9 days now since I emailed support to apply for ACH withdrawal status to be set up on my account with you, I sent you my full bank account details plus photo of my ID, but so far with no acknowledgment, no reply, no response to my post in your thread asking after this & the ACH has not been enabled on my account as yet.


Likewise, same deal for me.  Waiting...no reply.

I would love to continue to support BitFloor's resurrection, but I cannot justify sending any more coins there until I have a verified way to cash out.

Come on Roman, your remaining loyal clients and potential new ones are going to need some extra communication and responsiveness to rebuild your credibility after what happened.  So what's up?


Title: Re: bitfloor needs your help!
Post by: Rassah on October 03, 2012, 03:37:20 AM
Bought $5,000 worth of BTC today, and withdrew the BTC without issues. Everything seems to be working ok (I guess aside from some customer support/ACH issues)


Title: Re: bitfloor needs your help!
Post by: shtylman on October 03, 2012, 04:08:20 AM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...

Please?

New security continues to be unverified...

There are no reasonable ways for many of your questions to be verified. The production and testnet separation can be confirmed through a traceroute on the respective domains.

I welcome suggestions for reasonable ways in which you believe your requests can be confirmed without compromising user identities, trading activity, or balances.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on October 03, 2012, 05:05:03 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...

Please?

New security continues to be unverified...

There are no reasonable ways for many of your questions to be verified. The production and testnet separation can be confirmed through a traceroute on the respective domains.

I welcome suggestions for reasonable ways in which you believe your requests can be confirmed without compromising user identities, trading activity, or balances.

Smarter people could help me out here if I dont know what I'm talking about, but how about these ideas:

In order to prove "...changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk." You could sign messages from both the Bitfloor wallet and the customer funds wallet or at least show a picture of what you used to make the offline wallet or the offline wallet itself.

In order to prove "Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US." you could show some sort of recipt from said data center.

In order to prove "Backups are encrypted and write only on all of the servers." why not just host them publicly?  If they are properly encrypted it shouldn't be an issue and I believe with some cyrtpo hash magic a person should be able to verify their own details are in the backup without others being able to break it.




Title: Re: bitfloor needs your help!
Post by: BitcoinForLiberty on October 04, 2012, 03:12:36 PM
Roman,

Please tell us why Chase deposits into Bitfloor are not available this morning. Makes me wonder if your account was frozen by Chase.


Title: Re: bitfloor needs your help!
Post by: shtylman on October 04, 2012, 03:19:50 PM
Roman,

Please tell us why Chase deposits into Bitfloor are not available this morning. Makes me wonder if your account was frozen by Chase.


It was not frozen but they are closing it (details of which are private). I will be moving to a new cash deposit system which will also include more banks; however the transition will take a few weeks. The new system will continue to allow for free deposits. Apologies for any inconvenience this may cause to anyone using the Chase deposits.


Title: Re: bitfloor needs your help!
Post by: jwzguy on October 04, 2012, 04:57:36 PM
Roman,

Please tell us why Chase deposits into Bitfloor are not available this morning. Makes me wonder if your account was frozen by Chase.


It was not frozen but they are closing it (details of which are private). I will be moving to a new cash deposit system which will also include more banks; however the transition will take a few weeks. The new system will continue to allow for free deposits. Apologies for any inconvenience this may cause to anyone using the Chase deposits.
So Chase deposits are not coming back? The webpage says "Chase deposits are temporarily unavailable." Just curious as it is my main method of deposit.


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on October 06, 2012, 07:34:17 PM
Bitfloor has indeed resumed trading. My official statement on the matter is here:
https://plus.google.com/109620439233076225324/posts/bLJRDHApjSP

More generally https://blog.bitfloor.com will contain official updates.

If you have specific questions please contact support@bitfloor.com and I will gladly respond.

Any reasonable way for you to prove these claims?  Or someway for users to verify these claims themselves (this would be even better)

..."In reopening, a number of improvements to both the wallet storage and website have been made. Bitfloor aims to be safe and reliable platform and as a result have changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk."...

..."Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US. Bitfloor services are further isolated based on exposure. Testnet and development are not located in the same data center or hosting provider to ensure further isolation. Backups are encrypted and write only on all of the servers. Hot wallet files are encrypted even further and unavailable even with physical access to the disk."...

Please?

New security continues to be unverified...

There are no reasonable ways for many of your questions to be verified. The production and testnet separation can be confirmed through a traceroute on the respective domains.

I welcome suggestions for reasonable ways in which you believe your requests can be confirmed without compromising user identities, trading activity, or balances.

Smarter people could help me out here if I dont know what I'm talking about, but how about these ideas:

In order to prove "...changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk." You could sign messages from both the Bitfloor wallet and the customer funds wallet or at least show a picture of what you used to make the offline wallet or the offline wallet itself.

In order to prove "Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US." you could show some sort of recipt from said data center.

In order to prove "Backups are encrypted and write only on all of the servers." why not just host them publicly?  If they are properly encrypted it shouldn't be an issue and I believe with some cyrtpo hash magic a person should be able to verify their own details are in the backup without others being able to break it.




Were these bad ideas?


Title: Re: bitfloor needs your help!
Post by: notme on October 06, 2012, 08:37:06 PM
Smarter people could help me out here if I dont know what I'm talking about, but how about these ideas:

In order to prove "...changed our fund storage policy to 100% offline storage for your funds. Daily transactions through out hot wallet will be backed by Bitfloor funds, never putting client funds at risk." You could sign messages from both the Bitfloor wallet and the customer funds wallet or at least show a picture of what you used to make the offline wallet or the offline wallet itself.

In order to prove "Bitfloor is now running on dedicated servers in a PCI compliant data center based in the US." you could show some sort of recipt from said data center.

In order to prove "Backups are encrypted and write only on all of the servers." why not just host them publicly?  If they are properly encrypted it shouldn't be an issue and I believe with some cyrtpo hash magic a person should be able to verify their own details are in the backup without others being able to break it.




Were these bad ideas?

Yes, mostly.

1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
2) Shouldn't be too harmful since anyone can verify that themselves with the existing public record ;).
3) Making them public reduces the effort of a compromise from "breaking into his server, obtaining root access to change permissions on backups, copying backups, finding the password" to "finding the password".  Regardless, no amount of crypto "magic" will allow parts of the encrypted data to be read or even verified, so it would be pointless anyway.  Hashing and encryption are two very different beasts.


Title: Re: bitfloor needs your help!
Post by: davout on October 08, 2012, 07:44:44 AM
1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
Security through obscurity is not security.

3) Making them public reduces the effort of a compromise from "breaking into his server, obtaining root access to change permissions on backups, copying backups, finding the password" to "finding the password".  Regardless, no amount of crypto "magic" will allow parts of the encrypted data to be read or even verified, so it would be pointless anyway.  Hashing and encryption are two very different beasts.
Why not ? Say you hash the account identifiers (maybe with a per-account secret), pair them with their balance, sum the balances in a nice report.
Anyone can verify they are in the balance list, no one can look my balance up, I can check that the sum is consistent with the amount in cold storage.
That can also be seen as some sort of backup if properly signed, I'm sure the Bitcoinica folks would have loved to have something like that lying around.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 08, 2012, 08:23:34 AM
1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
Security through obscurity is not security.

Passwords are security through obscurity, so yes, it is.


Title: Re: bitfloor needs your help!
Post by: Vod on October 08, 2012, 08:09:05 PM
1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
Security through obscurity is not security.

Passwords are security through obscurity, so yes, it is.

A password by itself is useless - you need the associated login name.


Title: Re: bitfloor needs your help!
Post by: davout on October 08, 2012, 08:17:03 PM
1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
Security through obscurity is not security.

Passwords are security through obscurity, so yes, it is.

Ok smartass, let me just quote wikipedia for you :)
Quote
Security through obscurity is a pejorative referring to a principle in security engineering, which attempts to use secrecy of design or implementation to provide security.

A password by itself is useless - you need the associated login name.
Oh, and what are you doing here ? How about letting the grown-ups do the talking ?


Title: Re: bitfloor needs your help!
Post by: giszmo on October 08, 2012, 09:03:04 PM
Ok smartass, let me just quote wikipedia for you :)
Quote
Security through obscurity is a pejorative referring to a principle in security engineering, which attempts to use secrecy of design or implementation to provide security.

A password by itself is useless - you need the associated login name.
Oh, and what are you doing here ? How about letting the grown-ups do the talking ?

Don't feed the troll.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 08, 2012, 09:23:50 PM
1) Making public information about how he created his cold wallet, or how it is stored, or where it is stored reduces his security.
Security through obscurity is not security.

Passwords are security through obscurity, so yes, it is.

Ok smartass, let me just quote wikipedia for you :)
Quote
Security through obscurity is a pejorative referring to a principle in security engineering, which attempts to use secrecy of design or implementation to provide security.
The fact is though, revealing information about his cold storage procedures DOES reduce the effective security of said procedure.  One less unknown is one more factor a malicious entity could use in planning an attack.

I know the argument is that security measures should always be 100% bulletproof, so that even if all the facts were known, it wouldn't be possible to crack, but it is very rarely the case that such a scenario can be created.  Especially with regards to cold storage, the malicious entity would want to know where it is stored, how it is stored, how often and when it is accessed, etc.  Each of those unknowns is "security through obscurity", but each one, if revealed, would help an attacker with pulling off a heist.

Just my two cents.  ;)


Title: Re: bitfloor needs your help!
Post by: toffoo on October 11, 2012, 01:33:39 AM
Quote
bitfloor7:24 PM  -  Public

WellsFargo cash deposits are currently suspended. Due to this account suspension, ACH withdrawals will be delayed as the account is closed. These delays are outside of our control and we apologize for any inconvenience this may cause. We strive to process both USD and BTC in an efficient manner and will continue to do so after these delays are resolved.

We will post more information on the future of cash deposits as it becomes available.


Title: Re: bitfloor needs your help!
Post by: Otoh on October 11, 2012, 11:45:13 AM
ACH withdrawal was enabled on my account, it took a while but implemented earlier this week & just when I planned to test it out Wells Fargo go & break it, oh well I shall look at doing this in November now, I hope that Bitfloor will find the US banks more cooperative than the UK ones have proved to be for other Exchanges up until now. I guess that this explains why there's a 139 btc bid there atm for $12.20 while Gox price is just under $12 now, a nice arb op for someone who doesn't mind waiting to get the $ out.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 11, 2012, 04:23:07 PM
Roman - any update on the potential investors/payback of the lost BTC?


Title: Re: bitfloor needs your help!
Post by: whitslack on October 11, 2012, 04:59:11 PM
Roman - any update on the potential investors/payback of the lost BTC?
I somewhat expected to start seeing my "held" BTC balance tick downwards ever so slightly as transaction fees are being collected, but it hasn't happened. Maybe it's a manual process now, but Roman should automate it. Continuous, incremental progress toward getting everyone paid back, even if it will take years, would be a welcome sight.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 11, 2012, 05:02:57 PM
Roman - any update on the potential investors/payback of the lost BTC?
I somewhat expected to start seeing my "held" BTC balance tick downwards ever so slightly as transaction fees are being collected, but it hasn't happened. Maybe it's a manual process now, but Roman should automate it. Continuous, incremental progress toward getting everyone paid back, even if it will take years, would be a welcome sight.
Agreed, though I was also hoping he would find an investor to cover the losses.  ;)


Title: Re: bitfloor needs your help!
Post by: BCB on October 11, 2012, 05:52:00 PM
we tried....

https://bitcointalk.org/index.php?topic=112069.msg1212452#msg1212452


Title: Re: bitfloor needs your help!
Post by: SkRRJyTC on October 11, 2012, 07:42:51 PM
Roman - any update on the potential investors/payback of the lost BTC?
I somewhat expected to start seeing my "held" BTC balance tick downwards ever so slightly as transaction fees are being collected, but it hasn't happened. Maybe it's a manual process now, but Roman should automate it. Continuous, incremental progress toward getting everyone paid back, even if it will take years, would be a welcome sight.
Agreed, though I was also hoping he would find an investor to cover the losses.  ;)
we tried....

https://bitcointalk.org/index.php?topic=112069.msg1212452#msg1212452

Maybe its because confidence in security has not been restored.  I know mine hasn't.


Title: Re: bitfloor needs your help!
Post by: TheButterZone on October 11, 2012, 08:00:35 PM
I was thinking of selling my debt, but probably wouldn't get more than 10 cents on the dollar for it, if that. Should have done it right away like TangibleCrypto did.


Title: Re: bitfloor needs your help!
Post by: Tuxavant on October 11, 2012, 11:08:27 PM
Quote
bitfloor7:24 PM  -  Public

WellsFargo cash deposits are currently suspended.

Dammit!!!


Title: Re: bitfloor needs your help!
Post by: BlackHeartFund on October 12, 2012, 12:31:51 PM
I was thinking of selling my debt, but probably wouldn't get more than 10 cents on the dollar for it, if that. Should have done it right away like TangibleCrypto did.

Yeah but if you wait another month you will be saying that you should have sold a month ago for 10%...

Does anyone really thing any serious chunk of this debt will ever be paid back? Nothing is impossible, but that is impossible.


Title: Re: bitfloor needs your help!
Post by: TheButterZone on October 12, 2012, 07:49:35 PM
It's pointless to post once it gets into single digits.


Title: Re: bitfloor needs your help!
Post by: TheButterZone on October 18, 2012, 09:18:55 AM
Well, somebody(s) must be uber-confident in Bitfloor, considering there's ~545 BTC of liquidity on the asks side worth ~$6,755 right now, ranging from $11.90-14.01. Wonder when we're going to start seeing the BTC trickling back into our accounts.


Title: Re: bitfloor needs your help!
Post by: Tuxavant on October 18, 2012, 01:28:25 PM
Is there even a way to get cash in there yet (after the wells fargo/chase account closures)?


Title: Re: bitfloor needs your help!
Post by: Bigal on October 18, 2012, 02:11:33 PM
Well, somebody(s) must be uber-confident in Bitfloor, considering there's ~545 BTC of liquidity on the asks side worth ~$6,755 right now, ranging from $11.90-14.01. Wonder when we're going to start seeing the BTC trickling back into our accounts.

Good question, I'm glad to see it's back operational but until I see some attempt at my lost btc being paid back I just can't bring myself to use their service anymore.


Title: Re: bitfloor needs your help!
Post by: Rassah on October 18, 2012, 05:22:36 PM
I have been using ING Direct to transfer in USD, and have bought about $12,000 worth of bitcoin in the last 2 weeks already. All BTC in my own wallets now.


Title: Re: bitfloor needs your help!
Post by: notme on October 18, 2012, 08:55:58 PM
Yes, ING works.  Also, I have received 0.04 of my on hold BTC back so far.


Title: Re: bitfloor needs your help!
Post by: BCB on October 18, 2012, 09:15:35 PM
Rassah,

Based on your post I've made a deposit at bitfloor.   


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 18, 2012, 10:49:10 PM
The last time Roman posted here was 10/4.  He used to be a lot more active/enthusiastic about his site and updating users on the site's status.  I'm not sure if he's just letting it die a slow death or what, but the lack of progress on any front recently is rather discouraging to see.


Title: Re: bitfloor needs your help!
Post by: notme on October 18, 2012, 10:55:47 PM
The last time Roman posted here was 10/4.  He used to be a lot more active/enthusiastic about his site and updating users on the site's status.  I'm not sure if he's just letting it die a slow death or what, but the lack of progress on any front recently is rather discouraging to see.

He's still responsive via email.  I had a small issue that he took care of very quickly.


Title: Re: bitfloor needs your help!
Post by: retrapher on October 19, 2012, 05:36:55 AM
Has anybody gotten any hold BTC back? I have not gotten any.


Title: Re: bitfloor needs your help!
Post by: joesdc on October 19, 2012, 05:40:51 AM
I sent an e-mail to support on Oct 13 (6 days ago) and still have not gotten any replies. My stolen BTC does not show on my account so I'm worried and asked about it and have heard nothing.  ::)


Title: Re: bitfloor needs your help!
Post by: retrapher on October 19, 2012, 02:27:55 PM
I sent an e-mail to support on Oct 13 (6 days ago) and still have not gotten any replies. My stolen BTC does not show on my account so I'm worried and asked about it and have heard nothing.  ::)

It should show under overview as "hold".


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 19, 2012, 03:15:34 PM
Here's the latest response I got:

Quote
There are no updates on the BTC on hold yet.

cheers,
~Roman



Title: Re: bitfloor needs your help!
Post by: notme on October 19, 2012, 03:28:42 PM
Has anybody gotten any hold BTC back? I have not gotten any.

4 posts above yours.


Title: Re: bitfloor needs your help!
Post by: retrapher on October 20, 2012, 09:04:05 PM
Has anybody gotten any hold BTC back? I have not gotten any.

4 posts above yours.

I saw that, but you were the only person to claim it.


Title: Re: bitfloor needs your help!
Post by: whitslack on October 23, 2012, 02:36:28 AM
Bitfloor is presently suffering yet another outage. This is very unprofessional.


Title: Re: bitfloor needs your help!
Post by: whitslack on October 23, 2012, 12:46:13 PM
Bitfloor is presently suffering yet another outage. This is very unprofessional.

?? I see not outage right now.
It was down for a couple hours, confirmed by downforeveryoneorjustme.com. This was the last straw for me. I've begun cleaning out my account, which, since ACH withdrawals are currently unavailable, I can only do by buying BTC and withdrawing it.


Title: Re: bitfloor needs your help!
Post by: jwzguy on October 23, 2012, 03:51:56 PM
Did you email support when it was down?


Title: Re: bitfloor needs your help!
Post by: whitslack on October 23, 2012, 03:55:59 PM
Did you email support when it was down?
No.


Title: Re: bitfloor needs your help!
Post by: jwzguy on October 23, 2012, 06:13:30 PM
Ive been using bitfloor for quite a while and their downtime is relatively miniscule. The last time I noticed it was down I emailed support (I think it was after midnight est) and it was back up about 4 minutes later.


Title: Re: bitfloor needs your help!
Post by: BCB on October 23, 2012, 06:16:34 PM
I just made another deposit to give them another try.  These outages do not inspire confidence after the "hack"

Roman used to be better about updating us.

Outages happen.

Roman, Updates would be greatly appreciated if you really are trying to restore confidence in your service.



Title: Re: bitfloor needs your help!
Post by: puck2 on October 26, 2012, 12:39:23 AM
What's up with Bitfloor now? No deposits, no withdrawals?

I just made another deposit to give them another try.  These outages do not inspire confidence after the "hack"

Roman used to be better about updating us.

Outages happen.

Roman, Updates would be greatly appreciated if you really are trying to restore confidence in your service.




Title: Re: bitfloor needs your help!
Post by: BCB on October 26, 2012, 12:50:09 AM
My ING direct deposit went through fine.


Title: Re: bitfloor needs your help!
Post by: Rassah on October 27, 2012, 06:31:14 AM
Mine did too.


Title: Re: bitfloor needs your help!
Post by: bb113 on October 27, 2012, 02:37:19 PM
I really don't understand roman's behaviour. From what perspective does it make sense to stop communicating like this? Is he just disillusioned?


Title: Re: bitfloor needs your help!
Post by: BCB on October 27, 2012, 02:38:59 PM
Maybe he is no longer in control.  Has anyone been in touch with him directly.  He used to respond promptly to support@bitfloor.com emails.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on October 27, 2012, 07:29:17 PM
I really don't understand roman's behaviour. From what perspective does it make sense to stop communicating like this? Is he just disillusioned?
That's my guess.  Heck, if I had $250k that I had to recover through monthly profits in the 4 digits, I'd probably be pretty discouraged as well.

It's really, really sad.


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on October 27, 2012, 08:11:22 PM
I really don't understand roman's behaviour. From what perspective does it make sense to stop communicating like this? Is he just disillusioned?
That's my guess.  Heck, if I had $250k that I had to recover through monthly profits in the 4 digits, I'd probably be pretty discouraged as well.

It's really, really sad.

Eh, what's twenty years.


Title: Re: bitfloor needs your help!
Post by: DigitalHermit on October 27, 2012, 11:25:39 PM
I really don't understand roman's behaviour. From what perspective does it make sense to stop communicating like this? Is he just disillusioned?
That's my guess.  Heck, if I had $250k that I had to recover through monthly profits in the 4 digits, I'd probably be pretty discouraged as well.

It's really, really sad.

Yes very sad. This exchange seems to be dying the death of a thousand cuts. Let's review current unfavorable recent changes to the site:

  • Currently can't withdraw any cash
  • Currently can't make cash deposits
  • No longer able to view market depth data on site

I don't know how it would be possible to continue to run a market/exchange under these conditions. Liquidity will continue to evaporate.


Title: Re: bitfloor needs your help!
Post by: jwzguy on October 28, 2012, 12:06:23 AM
I really don't understand roman's behaviour. From what perspective does it make sense to stop communicating like this? Is he just disillusioned?
That's my guess.  Heck, if I had $250k that I had to recover through monthly profits in the 4 digits, I'd probably be pretty discouraged as well.

It's really, really sad.

Yes very sad. This exchange seems to be dying the death of a thousand cuts. Let's review current unfavorable recent changes to the site:

  • Currently can't withdraw any cash
  • Currently can't make cash deposits
  • No longer able to view market depth data on site

I don't know how it would be possible to continue to run a market/exchange under these conditions. Liquidity will continue to evaporate.
If they were indefinite, maybe, but since you'll be able to withdraw in a few days, things will be back to normal.

Dealing with these problems is inevitable in the war against banking cartels. It's no fault of the site operator.


Title: Re: bitfloor needs your help!
Post by: bb113 on October 30, 2012, 09:40:19 PM
To roman: please distribute 1 btc to all users so we can use it to provide liquidity on your exchange.


Title: Re: bitfloor needs your help!
Post by: TheButterZone on October 30, 2012, 09:53:52 PM
To roman: please distribute 1 btc to all users so we can use it to provide liquidity on your exchange.

LOL, that's over half of what I'm owed, so I would withdraw it.


Title: Re: bitfloor needs your help!
Post by: bb113 on October 30, 2012, 10:03:34 PM
To roman: please distribute 1 btc to all users so we can use it to provide liquidity on your exchange.

LOL, that's over half of what I'm owed, so I would withdraw it.

fine .1 btc. I'm not sure how many users there are but some reasonable amount per user.


Title: Re: bitfloor needs your help!
Post by: notme on October 31, 2012, 12:41:07 AM
To roman: please distribute 1 btc to all users so we can use it to provide liquidity on your exchange.

LOL, that's over half of what I'm owed, so I would withdraw it.

fine .1 btc. I'm not sure how many users there are but some reasonable amount per user.

How about an enhanced rebate for offer providers that comes from their on hold balance?


Title: Re: bitfloor needs your help!
Post by: Tuxavant on November 01, 2012, 03:46:56 AM
I emailed him the other day and he was responsive and indicated he was working hard to get cash deposits going again.


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on November 04, 2012, 08:14:45 PM
FYI, BitFloor support wrote to me saying that USD withdrawals via ACH are back to normal. That's good news.


Title: Re: bitfloor needs your help!
Post by: Rassah on November 05, 2012, 02:41:53 PM
FYI, BitFloor support wrote to me saying that USD withdrawals via ACH are back to normal. That's good news.

That's great news! Explains the really steep and narrow market graph this morning I guess. Someone should remind Roman to post an update on his Google+ blog.


Title: Re: bitfloor needs your help!
Post by: subject on November 11, 2012, 06:11:23 AM
the bitfloor blog hasn't been updated in over a month. Is there any news about cash deposits coming back soon or the frozen bitcoin beginning to release?

Has anyone dealt with the ING P2P deposits? Is it any hassle to use?


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on November 11, 2012, 12:46:24 PM
I have an ING Direct Electric Orange (EO) checking account. The P2P payment service is easy to use, no hassle once you have the EO account set up. Even if you don't keep any money in the EO account (no minimum balance required), transferring USD from another bank to EO to BitFloor is faster than transferring USD from another bank to Dwolla to Mt Gox. If you do keep some USD in the EO account, then transfers are even quicker. I actually like the EO checking account and replaced 1 of my other checking accounts with EO. Another comparative advantage is that P2P transfers are free and Dwolla costs 25 cents per transfer (for transfers of more than $10).


Title: Re: bitfloor needs your help!
Post by: vampire on November 12, 2012, 12:31:04 PM
If you're in NYC you may want to attend:

http://www.meetup.com/x-tech-meetup-chinatown-nyc/events/90059952/?gj=wc1b_e&a=wc1b_gnl&rv=wc1b_e


Title: Re: bitfloor needs your help!
Post by: subject on November 13, 2012, 04:26:58 AM
Thanks for the reply EuSou, I went ahead and created an ING account


Title: Re: bitfloor needs your help!
Post by: notme on November 13, 2012, 04:36:08 AM
If anyone else is going to open an ING account, pm me your email so I can send you a referral code.  With it, if you start the account with at least $250 you get $25 free.  Oh, and I'll get $10 to spend on my bitcoin habit :).


Title: Re: bitfloor needs your help!
Post by: subject on December 01, 2012, 07:27:04 AM
Happy to say that my first chunk of bitcoin on hold from the theft has finally come out of hold. About 1.7% but it's a good start. Cheers to Roman for a great effort bringing the website back up.


Title: Re: bitfloor needs your help!
Post by: HotDiggityDawg on December 01, 2012, 07:46:46 AM
Good to hear!

Have ACH transfers been resumed? The bank account used to conduct them was apparently migrated about 2 weeks ago and so they were held. I had mine cancelled (Roman was very quick with this btw) and withdrawn through other means but would like to know if ACH is back up and running.


Title: Re: bitfloor needs your help!
Post by: TheButterZone on December 01, 2012, 07:53:47 AM
Happy to say that my first chunk of bitcoin on hold from the theft has finally come out of hold. About 1.7% but it's a good start. Cheers to Roman for a great effort bringing the website back up.

0.03238623 avail of 1.90210029 total for me! Woo!


Title: Re: bitfloor needs your help!
Post by: Bigal on December 01, 2012, 12:12:27 PM
Code:
accounts
BTC
avail 0.51079690
hold 29.48920310
total 30.00000000
USD
avail 0.0396
hold 0.0000
total 0.0396

Excellent news! Still a long way to go but the effort speaks volumes.


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on December 01, 2012, 01:05:08 PM
I am thinking not only is Roman TRYING to pay us back, but rather he IS paying us back. Great news! I received a little over 1.7% of my held balance back. Actions speak louder than words. Going to BitFloor to place some orders now.


Title: Re: bitfloor needs your help!
Post by: davecoin on December 01, 2012, 05:00:02 PM
I have received some back as well. 

Thanks Roman and bitfloor supporters.

-Dave


Title: Re: bitfloor needs your help!
Post by: SgtSpike on December 01, 2012, 06:03:43 PM
Glad to finally see some action on that front... this gives me much greater confidence about the longevity of this exchange.


Title: Re: bitfloor needs your help!
Post by: BCB on December 01, 2012, 06:07:23 PM
Good news indeed.

Congrats Roman.

Bitcoin needs this.


Title: Re: bitfloor needs your help!
Post by: CoinDiver on December 01, 2012, 07:41:33 PM
Any idea when cash deposits will be allowed again?


Title: Re: bitfloor needs your help!
Post by: BoardGameCoin on December 01, 2012, 08:08:40 PM
I also received 1.7% of my held balance back. I hope Roman is able to continue bitfloors recovery. I'd like to be able to recommend it to friends again.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on December 03, 2012, 04:42:05 PM
Just to make note of this... if we assume 25,000 BTC is owed (I think that is the amount I remember), then 1.7% payouts represents 425 BTC.  Not a huge amount of money, but definitely enough to show commitment.


Title: Re: bitfloor needs your help!
Post by: BkkCoins on December 04, 2012, 05:37:16 AM
Is there a support thread here for BitFloor?
I tried to sign up and I get this page that says:

Error 404 - Profits Not Found

Not very encouraging.


Title: Re: bitfloor needs your help!
Post by: notme on December 04, 2012, 02:31:35 PM
Is there a support thread here for BitFloor?
I tried to sign up and I get this page that says:

Error 404 - Profits Not Found

Not very encouraging.

support@bitfloor.com


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on December 05, 2012, 05:17:36 PM
Good to hear!

Have ACH transfers been resumed? The bank account used to conduct them was apparently migrated about 2 weeks ago and so they were held. I had mine cancelled (Roman was very quick with this btw) and withdrawn through other means but would like to know if ACH is back up and running.

I just did an ACH withdrawal on Dec 3rd and it was credited to my bank account on Dec 5th. From the BitFloor blod Dec 2nd "ACH withdrawals are still available and continue to be free. There have been several delays recently with ACH. These have been due to backend and bank changes which have unfortunately gone on longer than anticipated. I do apologize for the inconvenience and am assured that everything is on track for normal operation starting this week."

At least my ACH withdrawal when through quickly without a hitch.


Title: Re: bitfloor needs your help!
Post by: 420 on December 06, 2012, 07:50:35 PM
are cash deposits halted?


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on December 06, 2012, 09:50:35 PM
are cash deposits halted?

For now cash deposits are not available. From the blog post on December 2nd, 2012.
https://plus.google.com/109620439233076225324/posts

"Many users have been asking about cash deposits. There are no new updates for cash deposits at this time. BitFloor is working on getting cash deposits at bank branches running again and will post updates as they are available."


Title: Re: bitfloor needs your help!
Post by: HotDiggityDawg on December 07, 2012, 09:22:07 AM
Good to hear!

Have ACH transfers been resumed? The bank account used to conduct them was apparently migrated about 2 weeks ago and so they were held. I had mine cancelled (Roman was very quick with this btw) and withdrawn through other means but would like to know if ACH is back up and running.

I just did an ACH withdrawal on Dec 3rd and it was credited to my bank account on Dec 5th. From the BitFloor blod Dec 2nd "ACH withdrawals are still available and continue to be free. There have been several delays recently with ACH. These have been due to backend and bank changes which have unfortunately gone on longer than anticipated. I do apologize for the inconvenience and am assured that everything is on track for normal operation starting this week."

At least my ACH withdrawal when through quickly without a hitch.

Well that's good to know! Last I checked the blog didn't have anything new on it, so it's good that he's getting these updates going and things seem to be slowly going back to normal.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on December 09, 2012, 05:15:15 AM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.


Title: Re: bitfloor needs your help!
Post by: 420 on December 09, 2012, 05:30:03 AM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.

where's his 'help me' donation box


Title: Re: bitfloor needs your help!
Post by: retrapher on December 09, 2012, 10:47:00 AM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.

No, because the transaction fees are a percentage so it scales up. The only way to make it harder or easier for Bitfloor to pay back its debts is to change its volume.


Title: Re: bitfloor needs your help!
Post by: notme on December 09, 2012, 05:30:50 PM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.

No, because the transaction fees are a percentage so it scales up. The only way to make it harder or easier for Bitfloor to pay back its debts is to change its volume.

Right, and for all of us doing dollar cost averaging increase in price means decrease in volume.


Title: Re: bitfloor needs your help!
Post by: smickles on December 09, 2012, 05:34:04 PM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.

where's his 'help me' donation box
1. Deposit some coin.
2. Buy as much USD as you can at the market rate.
3. Buy as much BTC as you can at the market rate.
4. GOTO 2


Title: Re: bitfloor needs your help!
Post by: davout on December 09, 2012, 05:34:28 PM
Right, and for all of us doing dollar cost averaging increase in price means decrease in volume.
Haha, smart!


Title: Re: bitfloor needs your help!
Post by: SgtSpike on December 10, 2012, 06:51:31 PM
I received a little over 1.7% of my held balance back.

If the exchange rate goes up much more that would make it harder on BitFloor.  It is like taking out a  BTC loan and then having to repay from dollar-based income.

No, because the transaction fees are a percentage so it scales up. The only way to make it harder or easier for Bitfloor to pay back its debts is to change its volume.

Right, and for all of us doing dollar cost averaging increase in price means decrease in volume.
OTOH, if Bitcoin goes to $1,000, you can bet on there being a lot higher volume, just because an increase in price generally correlates with an increase in interest.


Title: Re: bitfloor needs your help!
Post by: bb113 on January 10, 2013, 06:42:39 AM
Apparently that 1.5% satisfied everyone. I wonder what he has in store next. It'd be nice to see some kind of indicator that "fills up" until the threshold is reached.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on January 10, 2013, 07:21:12 AM
Apparently that 1.5% satisfied everyone. I wonder what he has in store next. It'd be nice to see some kind of indicator that "fills up" until the threshold is reached.
Well, it's better than nothing in that it shows SOME progress...


Title: Re: bitfloor needs your help!
Post by: BoardGameCoin on January 10, 2013, 07:31:58 AM
I keep rough tabs on the intake in terms of revenue for bitfloor to guess about how long it'll take to be paid back. I'm still a little surprised they were able to make the payment they did, but certainly grateful for it. I think outside investment might have been or be involved. On a relatively high-volume day like today, they make ~ 5BTC. It would take 13 years of days like today's to provide enough revenue to cover the debt.

My hope is that they can become an exchange to rival Gox. If they split Gox's current market share and there wasn't additional growth, then they could pay their debt with 1.5 years worth or revenue.

We'll see. One thing is certain: they need to continue to communicate and find ways to make deposits quicker/easier. I appreciate their approach, and am probably about a month of stability away from starting to use them again, though this time with a lot less BTC floating on the exchange.


Title: Re: bitfloor needs your help!
Post by: bb113 on January 10, 2013, 10:40:32 AM
Ok this summarizes it pretty well. Data is from: http://bitcoincharts.com/markets/bitfloorUSD.html

http://i47.tinypic.com/107uql0.png
http://i47.tinypic.com/107uql0.png

This R script will generate the above updated according to the bitcoin charts schedule. If someone knows how to host it and have it update in this thread automatically that would be cool:
Code:

#Set the estimated proportion payed back
est.payed.back<-.017

#Get Data from bitcoincharts
bitfloor<-read.table("http://bitcoincharts.com/t/trades.csv?symbol=bitfloorUSD&start=0",
                     sep=","
)

##Convert Times from Unix
times=matrix(nrow=nrow(bitfloor), ncol=6)
time.string=NULL
for(i in 1:nrow(bitfloor)){
  timeStamp<-ISOdatetime(1970,1,1,0,0,0) + bitfloor[i,1]
  
  date<-strsplit(as.character(timeStamp), " ")[[1]][1]
  yr<-as.numeric(strsplit(date, "-")[[1]][1])
  mo<-as.numeric(strsplit(date, "-")[[1]][2])
  day<-as.numeric(strsplit(date, "-")[[1]][3])
  
  ToD<-strsplit(as.character(timeStamp), " ")[[1]][2]
  hr<-as.numeric(strsplit(ToD, ":")[[1]][1])
  min<-as.numeric(strsplit(ToD, ":")[[1]][2])
  sec<-as.numeric(strsplit(ToD, ":")[[1]][2])
  
  times[i,]<-cbind(yr,mo,day,hr,min,sec)
  time.string<-rbind(time.string,as.character(timeStamp))
}

bitfloor<-cbind(times,bitfloor)
colnames(bitfloor)<-c("Yr","Mo","Day","Hr","Min","Sec","UnixT","Price","Vol")

##Set First Timestamp bitfloor was open after hack
post.hack.open.time<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==9 & bitfloor[,3]==21),],
  1)[7])

##Divide into pre and post hack data
pre.hack.bitfloor<-bitfloor[which(bitfloor[,7]<post.hack.open.time),]
post.hack.bitfloor<-bitfloor[which(bitfloor[,7]>(post.hack.open.time-1)),]

#Generate cumulative volume and fees
pre.hack.bitfloor<-cbind(pre.hack.bitfloor,
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9]),
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9])*.005
)
colnames(pre.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")

post.hack.bitfloor<-cbind(post.hack.bitfloor,
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9]),
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9])*.003
)
colnames(post.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")
#

##Set Timestamp of first payout
payback.time.one<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==12 & bitfloor[,3]==1),],
  1)[7])

##Split into pre and post payout
pre.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]<payback.time.one),]
post.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]>(payback.time.one-1)),]

#Generate cumulative volume and fee data
pre.payout.one[,10:11]<-cbind(
  cumsum(pre.payout.one[,8]*pre.payout.one[,9]),
  cumsum(pre.payout.one[,8]*pre.payout.one[,9])*.003
)

post.payout.one[,10:11]<-cbind(
  cumsum(post.payout.one[,8]*post.payout.one[,9]),
  cumsum(post.payout.one[,8]*post.payout.one[,9])*.003
)
#

##Get months from unix timestamps
month.labels=data.frame()
for(y in 2012:2013){
  for(m in 1:12){
    unixT<-bitfloor[which(bitfloor[,1]==y & bitfloor[,2]==m),7][1]
    month.labels<-rbind(month.labels,cbind(unixT,month.name[m]))
  }
}
month.labels<-month.labels[which(!is.na(month.labels[,1])),]
month.labels<-month.labels[2:nrow(month.labels),]

##Misc
Total.Value.Stolen<-25000*tail(bitfloor[,8],1)
Total.Value.Payed<-est.payed.back*Total.Value.Stolen

##Make Plots
dev.new()
layout(matrix(c(1,1,1,3,2,2,2,4), 2, 4, byrow = TRUE))
plot(bitfloor[,7],bitfloor[,8], type="n", xaxt="n",
     xlab="Time",
     ylab="USD/BTC",ylim=c(0,(max(bitfloor[,8])+5)),
     main="Bitfloor Price History"
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.hack.bitfloor[,7],pre.hack.bitfloor[,8], col="Green")
lines(pre.payout.one[,7],pre.payout.one[,8], col="Red")
lines(post.payout.one[,7],post.payout.one[,8], col="Blue")
abline(v=payback.time.one)

plot(pre.hack.bitfloor[,7],pre.hack.bitfloor[,11], xaxt="n",
     xlab="Time",
     ylab="Cumulative Fees Generated (USD)",
     xlim=c(min(bitfloor[,7]),max(bitfloor[,7])),
     type="l", lwd=3, col="Green",
     main=c("Bitfloor Cumulative Fee Revenue",
            "Before Hack Rate= 0.5%,   After Hack= 0.3%")
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.payout.one[,7],pre.payout.one[,11],
      type="l", lwd=3, col="Red"
)
lines(post.payout.one[,7],post.payout.one[,11],
      type="l", lwd=3, col="Blue"
)
abline(v=payback.time.one)

barplot(c(
  Total.Value.Stolen,
  Total.Value.Payed
),
        ylab="USD", ylim=c(0,1.1*Total.Value.Stolen),
        names.arg=c(paste("Value Stolen=", Total.Value.Stolen),
                    paste("Value Payed=",Total.Value.Payed)),
        col=c("Red","Green"),
        main=paste("Estimated Payed Back=",100*est.payed.back,"%")
)

barplot(c(
  max(pre.payout.one[,11]),
  max(post.payout.one[,11])
),
        ylim=c(0,1.1*max(c(max(pre.payout.one[,11]),max(post.payout.one[,11])))),
        ylab="Fees Generated (USD)",
        names.arg=c(paste("Hack to First Payout=", round(max(pre.payout.one[,11]),1)),
                    paste("Since=",round(max(post.payout.one[,11]),1))),
        col=c("Red","Blue"),
        main="Fees Generated Since Hack"
)





It did take some effort so if anyone finds it useful: 13oEWYh1tEM6voFp2XmBoD6CCCbidkk2Xm


Title: Re: bitfloor needs your help!
Post by: 420 on January 12, 2013, 05:57:54 AM
What is this ING deposit? like a online based company has checking accounts?


Title: Re: bitfloor needs your help!
Post by: Rassah on January 12, 2013, 06:19:13 AM
What is this ING deposit? like a online based company has checking accounts?

ING was the second online-only bank after NetBank, at a time when online banking was somewhat in its infancy, and the general idea was that all banks should have buildings and bank branches. By being entirely online, ING was able so save a lot of money, and offer free checking with lots of free features, as well as savings accounts with the highest interest rates in the country. They also for a time allowed you to use any ATM for free, and even reimbursed you the $1.50 ATM cash withdrawal fees many ATMs charge. Another feature was that they bragged about being able to fire their customers. In other words, if you called and complained too much, or had too many overdrafts, they would cancel your account and kindly ask you to go elsewhere. Basically, they advertised themselves as a bank for tech-savvy, responsible types.
They have gone a little bit downhill since, mainly with their savings rates and such, but I still use them as my main bank. Their ING P2P feature allows you to wire money to anyone else for free, which takes 2 to 3 days for external transfers, and instantly between ING customers. Bitfloor allows you to send them money using your ING account for free, but since they don't have an ING account themselves, it takes 3 days.


Title: Re: bitfloor needs your help!
Post by: notme on January 12, 2013, 06:23:31 AM
What is this ING deposit? like a online based company has checking accounts?

ING was the second online-only bank after NetBank, at a time when online banking was somewhat in its infancy, and the general idea was that all banks should have buildings and bank branches. By being entirely online, ING was able so save a lot of money, and offer free checking with lots of free features, as well as savings accounts with the highest interest rates in the country. They also for a time allowed you to use any ATM for free, and even reimbursed you the $1.50 ATM cash withdrawal fees many ATMs charge. Another feature was that they bragged about being able to fire their customers. In other words, if you called and complained too much, or had too many overdrafts, they would cancel your account and kindly ask you to go elsewhere. Basically, they advertised themselves as a bank for tech-savvy, responsible types.
They have gone a little bit downhill since, mainly with their savings rates and such, but I still use them as my main bank. Their ING P2P feature allows you to wire money to anyone else for free, which takes 2 to 3 days for external transfers, and instantly between ING customers. Bitfloor allows you to send them money using your ING account for free, but since they don't have an ING account themselves, it takes 3 days.

They are now a subsidiary of Capital One, but other than that they are great.

Also, Bitfloor should get an ING account.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on January 12, 2013, 05:54:31 PM
ING doesn't have business checking accounts.


Title: Re: bitfloor needs your help!
Post by: DannyHamilton on January 12, 2013, 08:38:08 PM
They are now a subsidiary of Capital One . . .
Looks like the are going to be re-branded.  No more "ING" or "Electric Orange". Now it will be "Capital One 360" and "360 Checking":

https://home.ingdirect.com/capitalone/product-updates


Title: Re: bitfloor needs your help!
Post by: Elwar on January 16, 2013, 05:58:40 PM
So Bitfloor still takes ING p2p deposits? I was on their site and could not find it.

I am currently at work so I cannot access the page but could someone show me where I go to do this?


Title: Re: bitfloor needs your help!
Post by: jwzguy on January 16, 2013, 06:00:46 PM
So Bitfloor still takes ING p2p deposits? I was on their site and could not find it.

I am currently at work so I cannot access the page but could someone show me where I go to do this?
Click on deposit. If you don't see the deposit tab you may need to log in first.


Title: Re: bitfloor needs your help!
Post by: notme on January 16, 2013, 06:25:03 PM
So Bitfloor still takes ING p2p deposits? I was on their site and could not find it.

I am currently at work so I cannot access the page but could someone show me where I go to do this?
Click on deposit. If you don't see the deposit tab you may need to log in first.

Yep, deposit->USD->ING P2P


Title: Re: bitfloor needs your help!
Post by: 420 on January 19, 2013, 11:04:38 PM
why can only withdraw via ACH and not ING p2p?


Title: Re: bitfloor needs your help!
Post by: jwzguy on January 20, 2013, 12:21:07 AM
why can only withdraw via ACH and not ING p2p?
Because ING does not allow businesses to open accounts with the P2P capability. Bitfloor doesn't have an ING account. They just accept transfers from them.


Title: Re: bitfloor needs your help!
Post by: 420 on January 20, 2013, 02:06:04 AM
why can only withdraw via ACH and not ING p2p?
Because ING does not allow businesses to open accounts with the P2P capability. Bitfloor doesn't have an ING account. They just accept transfers from them.

owner could just open in his name


Title: Re: bitfloor needs your help!
Post by: subject on February 15, 2013, 03:38:49 AM
Any word on the next release of held funds shtylman?


Title: Re: bitfloor needs your help!
Post by: notme on February 15, 2013, 05:03:45 AM
Ok this summarizes it pretty well. Data is from: http://bitcoincharts.com/markets/bitfloorUSD.html

http://i47.tinypic.com/107uql0.png
http://i47.tinypic.com/107uql0.png

This R script will generate the above updated according to the bitcoin charts schedule. If someone knows how to host it and have it update in this thread automatically that would be cool:
Code:

#Set the estimated proportion payed back
est.payed.back<-.017

#Get Data from bitcoincharts
bitfloor<-read.table("http://bitcoincharts.com/t/trades.csv?symbol=bitfloorUSD&start=0",
                     sep=","
)

##Convert Times from Unix
times=matrix(nrow=nrow(bitfloor), ncol=6)
time.string=NULL
for(i in 1:nrow(bitfloor)){
  timeStamp<-ISOdatetime(1970,1,1,0,0,0) + bitfloor[i,1]
  
  date<-strsplit(as.character(timeStamp), " ")[[1]][1]
  yr<-as.numeric(strsplit(date, "-")[[1]][1])
  mo<-as.numeric(strsplit(date, "-")[[1]][2])
  day<-as.numeric(strsplit(date, "-")[[1]][3])
  
  ToD<-strsplit(as.character(timeStamp), " ")[[1]][2]
  hr<-as.numeric(strsplit(ToD, ":")[[1]][1])
  min<-as.numeric(strsplit(ToD, ":")[[1]][2])
  sec<-as.numeric(strsplit(ToD, ":")[[1]][2])
  
  times[i,]<-cbind(yr,mo,day,hr,min,sec)
  time.string<-rbind(time.string,as.character(timeStamp))
}

bitfloor<-cbind(times,bitfloor)
colnames(bitfloor)<-c("Yr","Mo","Day","Hr","Min","Sec","UnixT","Price","Vol")

##Set First Timestamp bitfloor was open after hack
post.hack.open.time<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==9 & bitfloor[,3]==21),],
  1)[7])

##Divide into pre and post hack data
pre.hack.bitfloor<-bitfloor[which(bitfloor[,7]<post.hack.open.time),]
post.hack.bitfloor<-bitfloor[which(bitfloor[,7]>(post.hack.open.time-1)),]

#Generate cumulative volume and fees
pre.hack.bitfloor<-cbind(pre.hack.bitfloor,
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9]),
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9])*.005
)
colnames(pre.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")

post.hack.bitfloor<-cbind(post.hack.bitfloor,
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9]),
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9])*.003
)
colnames(post.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")
#

##Set Timestamp of first payout
payback.time.one<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==12 & bitfloor[,3]==1),],
  1)[7])

##Split into pre and post payout
pre.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]<payback.time.one),]
post.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]>(payback.time.one-1)),]

#Generate cumulative volume and fee data
pre.payout.one[,10:11]<-cbind(
  cumsum(pre.payout.one[,8]*pre.payout.one[,9]),
  cumsum(pre.payout.one[,8]*pre.payout.one[,9])*.003
)

post.payout.one[,10:11]<-cbind(
  cumsum(post.payout.one[,8]*post.payout.one[,9]),
  cumsum(post.payout.one[,8]*post.payout.one[,9])*.003
)
#

##Get months from unix timestamps
month.labels=data.frame()
for(y in 2012:2013){
  for(m in 1:12){
    unixT<-bitfloor[which(bitfloor[,1]==y & bitfloor[,2]==m),7][1]
    month.labels<-rbind(month.labels,cbind(unixT,month.name[m]))
  }
}
month.labels<-month.labels[which(!is.na(month.labels[,1])),]
month.labels<-month.labels[2:nrow(month.labels),]

##Misc
Total.Value.Stolen<-25000*tail(bitfloor[,8],1)
Total.Value.Payed<-est.payed.back*Total.Value.Stolen

##Make Plots
dev.new()
layout(matrix(c(1,1,1,3,2,2,2,4), 2, 4, byrow = TRUE))
plot(bitfloor[,7],bitfloor[,8], type="n", xaxt="n",
     xlab="Time",
     ylab="USD/BTC",ylim=c(0,(max(bitfloor[,8])+5)),
     main="Bitfloor Price History"
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.hack.bitfloor[,7],pre.hack.bitfloor[,8], col="Green")
lines(pre.payout.one[,7],pre.payout.one[,8], col="Red")
lines(post.payout.one[,7],post.payout.one[,8], col="Blue")
abline(v=payback.time.one)

plot(pre.hack.bitfloor[,7],pre.hack.bitfloor[,11], xaxt="n",
     xlab="Time",
     ylab="Cumulative Fees Generated (USD)",
     xlim=c(min(bitfloor[,7]),max(bitfloor[,7])),
     type="l", lwd=3, col="Green",
     main=c("Bitfloor Cumulative Fee Revenue",
            "Before Hack Rate= 0.5%,   After Hack= 0.3%")
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.payout.one[,7],pre.payout.one[,11],
      type="l", lwd=3, col="Red"
)
lines(post.payout.one[,7],post.payout.one[,11],
      type="l", lwd=3, col="Blue"
)
abline(v=payback.time.one)

barplot(c(
  Total.Value.Stolen,
  Total.Value.Payed
),
        ylab="USD", ylim=c(0,1.1*Total.Value.Stolen),
        names.arg=c(paste("Value Stolen=", Total.Value.Stolen),
                    paste("Value Payed=",Total.Value.Payed)),
        col=c("Red","Green"),
        main=paste("Estimated Payed Back=",100*est.payed.back,"%")
)

barplot(c(
  max(pre.payout.one[,11]),
  max(post.payout.one[,11])
),
        ylim=c(0,1.1*max(c(max(pre.payout.one[,11]),max(post.payout.one[,11])))),
        ylab="Fees Generated (USD)",
        names.arg=c(paste("Hack to First Payout=", round(max(pre.payout.one[,11]),1)),
                    paste("Since=",round(max(post.payout.one[,11]),1))),
        col=c("Red","Blue"),
        main="Fees Generated Since Hack"
)





It did take some effort so if anyone finds it useful: 13oEWYh1tEM6voFp2XmBoD6CCCbidkk2Xm

If you can make it output to an image file, I'd be glad to put up a link and a cronjob to update it once a week.


Title: Re: bitfloor needs your help!
Post by: notme on February 15, 2013, 05:04:58 AM
Nevermind, I see it generates a pdf.  I can convert that to a png.

http://dl.getdropbox.com/u/176027/bitfloor_fees.png


Title: Re: bitfloor needs your help!
Post by: bb113 on February 18, 2013, 05:26:23 PM
It looks like some of the text is cut off at the current size, do you want it to automatically generate a png?

This will automatically create "bitfloor.png" in whatever your working directory is. I'm not sure how familiar you are with R... to see the working directory run getwd()

Code:


#Get Data from bitcoincharts
bitfloor<-read.table("http://bitcoincharts.com/t/trades.csv?symbol=bitfloorUSD&start=0",
                     sep=","
)

##Convert Times from Unix
times=matrix(nrow=nrow(bitfloor), ncol=6)
time.string=NULL
for(i in 1:nrow(bitfloor)){
  timeStamp<-ISOdatetime(1970,1,1,0,0,0) + bitfloor[i,1]
 
  date<-strsplit(as.character(timeStamp), " ")[[1]][1]
  yr<-as.numeric(strsplit(date, "-")[[1]][1])
  mo<-as.numeric(strsplit(date, "-")[[1]][2])
  day<-as.numeric(strsplit(date, "-")[[1]][3])
 
  ToD<-strsplit(as.character(timeStamp), " ")[[1]][2]
  hr<-as.numeric(strsplit(ToD, ":")[[1]][1])
  min<-as.numeric(strsplit(ToD, ":")[[1]][2])
  sec<-as.numeric(strsplit(ToD, ":")[[1]][2])
 
  times[i,]<-cbind(yr,mo,day,hr,min,sec)
  time.string<-rbind(time.string,as.character(timeStamp))
}

bitfloor<-cbind(times,bitfloor)
colnames(bitfloor)<-c("Yr","Mo","Day","Hr","Min","Sec","UnixT","Price","Vol")

##Set First Timestamp bitfloor was open after hack
post.hack.open.time<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==9 & bitfloor[,3]==21),],
  1)[7])

##Divide into pre and post hack data
pre.hack.bitfloor<-bitfloor[which(bitfloor[,7]<post.hack.open.time),]
post.hack.bitfloor<-bitfloor[which(bitfloor[,7]>(post.hack.open.time-1)),]

#Generate cumulative volume and fees
pre.hack.bitfloor<-cbind(pre.hack.bitfloor,
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9]),
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9])*.005
)
colnames(pre.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")

post.hack.bitfloor<-cbind(post.hack.bitfloor,
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9]),
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9])*.003
)
colnames(post.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")
#

##Set Timestamp of first payout
payback.time.one<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==12 & bitfloor[,3]==1),],
  1)[7])

##Split into pre and post payout
pre.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]<payback.time.one),]
post.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]>(payback.time.one-1)),]

#Generate cumulative volume and fee data
pre.payout.one[,10:11]<-cbind(
  cumsum(pre.payout.one[,8]*pre.payout.one[,9]),
  cumsum(pre.payout.one[,8]*pre.payout.one[,9])*.003
)

post.payout.one[,10:11]<-cbind(
  cumsum(post.payout.one[,8]*post.payout.one[,9]),
  cumsum(post.payout.one[,8]*post.payout.one[,9])*.003
)
#

##Get months from unix timestamps
month.labels=data.frame()
for(y in 2012:2013){
  for(m in 1:12){
    unixT<-bitfloor[which(bitfloor[,1]==y & bitfloor[,2]==m),7][1]
    month.labels<-rbind(month.labels,cbind(unixT,month.name[m]))
  }
}
month.labels<-month.labels[which(!is.na(month.labels[,1])),]
month.labels<-month.labels[2:nrow(month.labels),]

##Misc
est.payed.back<-.017
Total.Value.Stolen<-25000*tail(bitfloor[,8],1)
Total.Value.Payed<-est.payed.back*Total.Value.Stolen

##Make Plots
png("bitfloor.png", height=800, width=1300, pointsize=15)
layout(matrix(c(1,1,1,3,2,2,2,4), 2, 4, byrow = TRUE))
plot(bitfloor[,7],bitfloor[,8], type="n", xaxt="n",
     xlab="Time",
     ylab="USD/BTC",ylim=c(0,(max(bitfloor[,8])+5)),
     main="Bitfloor Price History"
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.hack.bitfloor[,7],pre.hack.bitfloor[,8], col="Green")
lines(pre.payout.one[,7],pre.payout.one[,8], col="Red")
lines(post.payout.one[,7],post.payout.one[,8], col="Blue")
abline(v=payback.time.one)

plot(pre.hack.bitfloor[,7],pre.hack.bitfloor[,11], xaxt="n",
     xlab="Time",
     ylab="Cumulative Fees Generated (USD)",
     xlim=c(min(bitfloor[,7]),max(bitfloor[,7])),
     type="l", lwd=3, col="Green",
     main=c("Bitfloor Cumulative Fee Revenue",
            "Before Hack Rate= 0.5%,   After Hack= 0.3%")
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.payout.one[,7],pre.payout.one[,11],
      type="l", lwd=3, col="Red"
)
lines(post.payout.one[,7],post.payout.one[,11],
      type="l", lwd=3, col="Blue"
)
abline(v=payback.time.one)

barplot(c(
  Total.Value.Stolen,
  Total.Value.Payed
),
        ylab="USD", ylim=c(0,1.1*Total.Value.Stolen),
        names.arg=c(paste("Value Stolen=", Total.Value.Stolen),
                    paste("Value Payed=",Total.Value.Payed)),
        col=c("Red","Green"),
        main=paste("Estimated Payed Back=",100*est.payed.back,"%")
)

barplot(c(
  max(pre.payout.one[,11]),
  max(post.payout.one[,11])
),
        ylim=c(0,1.1*max(c(max(pre.payout.one[,11]),max(post.payout.one[,11])))),
        ylab="Fees Generated (USD)",
        names.arg=c(paste("Hack to First Payout=", round(max(pre.payout.one[,11]),1)),
                    paste("Since=",round(max(post.payout.one[,11]),1))),
        col=c("Red","Blue"),
        main="Fees Generated Since Hack"
)
dev.off()



you may need to adjust these settings for your system, I had to play around with it:
Code:
png("bitfloor.png", height=800, width=1300, pointsize=15)


Title: Re: bitfloor needs your help!
Post by: UNOE on March 16, 2013, 10:47:46 PM
Hoping to see a payout soon what's going on.  Is there another thread I should be reading.


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 17, 2013, 04:02:24 AM
Hoping to see a payout soon what's going on.  Is there another thread I should be reading.

In discussion I have called Roman out a couple times.  He has not responded.

Look for a thread in scam accusations next weekend.


Title: Re: bitfloor needs your help!
Post by: Domrada on March 17, 2013, 06:08:12 AM
Hoping to see a payout soon what's going on.  Is there another thread I should be reading.

In discussion I have called Roman out a couple times.  He has not responded.

Look for a thread in scam accusations next weekend.

I'm confused.  If I'm interpreting the chart correctly, it looks like Bitfloor has made ~3000 in revenue and paid back ~6000.  That means Roman must have paid back ~3000 additional out of his own pocket. What sort of scam are you alleging?


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 17, 2013, 03:36:24 PM
Hoping to see a payout soon what's going on.  Is there another thread I should be reading.

In discussion I have called Roman out a couple times.  He has not responded.

Look for a thread in scam accusations next weekend.

I'm confused.  If I'm interpreting the chart correctly, it looks like Bitfloor has made ~3000 in revenue and paid back ~6000.  That means Roman must have paid back ~3000 additional out of his own pocket. What sort of scam are you alleging?

Let's give Roman a chance to reply to my questions in service discussion.

As for the rest, wait and see if I actually make a Scam post.


Title: Re: bitfloor needs your help!
Post by: Herodes on March 18, 2013, 06:37:49 AM
Is Bitfloor dead? Seems like the orderbook is empty ? Just made an account there just to check things out..


Title: Re: bitfloor needs your help!
Post by: TheButterZone on March 18, 2013, 06:51:31 AM
http://bitcoin.clarkmoody.com/bitfloor/


Title: Re: bitfloor needs your help!
Post by: Herodes on March 18, 2013, 06:55:59 AM
http://bitcoin.clarkmoody.com/bitfloor/

Strange - just took a long time to load the market data - so long I thought everything was dead..


Title: Re: bitfloor needs your help!
Post by: dreamwatcher on March 19, 2013, 03:17:26 PM
Just wanted to relay my recent experience with Bitfloor:

I am one of the customers that have BTC being held due to the hack (about 61 BTC..around $2900 in today's terms..  :(   )

Over this last weekend I decided to give Bitfloor another chance and sold about $850 worth of BTC and initiated an ACH withdrawal.

The transfer went smoothly and the money was in my bank account today.

Although I do wish Roman would be a bit more vocal about what is going on, at least to those with BTC being held, this experience has been a big first step in Bitfloor earning my trust back.


Hopefully the recent BTC rally will earn Bitfloor enough volume to release some more of the held BTC..especially in today's market.

 
 


Title: Re: bitfloor needs your help!
Post by: Rassah on March 19, 2013, 04:04:40 PM
I still use Bitfloor all the time, and generally never have any issues with them. It's way more convenient for deposits and withdrawals than MtGox. The only annoyance is that the buy and sell sides are a bit weak, and at times have a large gap between them, making it more expensive to buy there than at Gox. But that's just a low user problem, and I guess can't be helped.


Title: Re: bitfloor needs your help!
Post by: qxzn on March 19, 2013, 04:20:05 PM
Hopefully the recent BTC rally will earn Bitfloor enough volume to release some more of the held BTC..especially in today's market.

I spoke with Roman the other week and he pointed out that this actually has ups and downs. The rally has helped volume on bitfloor, but it's also raised the dollar cost of buying coin, which is exactly what bitfloor has to do each time he makes a payment. (fees are earned in dollars)


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 19, 2013, 04:22:52 PM
The new FinCEN regs are going to put BitFloor out of business.  Adios, 12 BTC...


Title: Re: bitfloor needs your help!
Post by: notme on March 19, 2013, 11:22:28 PM
Hopefully the recent BTC rally will earn Bitfloor enough volume to release some more of the held BTC..especially in today's market.

I spoke with Roman the other week and he pointed out that this actually has ups and downs. The rally has helped volume on bitfloor, but it's also raised the dollar cost of buying coin, which is exactly what bitfloor has to do each time he makes a payment. (fees are earned in dollars)

Fuck.  We'll never see them all if he holds fees in dollars and then converts when he pays out.


Title: Re: bitfloor needs your help!
Post by: qxzn on March 19, 2013, 11:46:41 PM
The new FinCEN regs are going to put BitFloor out of business.  Adios, 12 BTC...

Will it? Bitfloor is already registered as an MSB:

http://www.fincen.gov/financial_institutions/msb/msbstateselector.html

(type 'bitfloor' into the legal name field)


Title: Re: bitfloor needs your help!
Post by: qxzn on March 19, 2013, 11:51:44 PM
Hopefully the recent BTC rally will earn Bitfloor enough volume to release some more of the held BTC..especially in today's market.

I spoke with Roman the other week and he pointed out that this actually has ups and downs. The rally has helped volume on bitfloor, but it's also raised the dollar cost of buying coin, which is exactly what bitfloor has to do each time he makes a payment. (fees are earned in dollars)

Fuck.  We'll never see them all if he holds fees in dollars and then converts when he pays out.

Everyone seems to be talking like bitcoins will never go down again. Sounds a bit like folks were talking about houses a few years back.. :-P

I guess on the bright side it's sorta like a hedge; if the price of bitcoins goes down, you get more of your bitfloor coins faster :).


Title: Re: bitfloor needs your help!
Post by: malevolent on March 19, 2013, 11:52:55 PM
Will it? Bitfloor is already registered as an MSB:
http://www.fincen.gov/financial_institutions/msb/msbstateselector.html
(type 'bitfloor' into the legal name field)

Quote
The inclusion of a business on the MSB Registrant Search Web page is not a recommendation,
certification of legitimacy, or endorsement of the business by any government agency.


Title: Re: bitfloor needs your help!
Post by: qxzn on March 19, 2013, 11:56:51 PM
Will it? Bitfloor is already registered as an MSB:
http://www.fincen.gov/financial_institutions/msb/msbstateselector.html
(type 'bitfloor' into the legal name field)

Quote
The inclusion of a business on the MSB Registrant Search Web page is not a recommendation,
certification of legitimacy, or endorsement of the business by any government agency.

Your point?


Title: Re: bitfloor needs your help!
Post by: notme on March 20, 2013, 12:08:27 AM
Hopefully the recent BTC rally will earn Bitfloor enough volume to release some more of the held BTC..especially in today's market.

I spoke with Roman the other week and he pointed out that this actually has ups and downs. The rally has helped volume on bitfloor, but it's also raised the dollar cost of buying coin, which is exactly what bitfloor has to do each time he makes a payment. (fees are earned in dollars)

Fuck.  We'll never see them all if he holds fees in dollars and then converts when he pays out.

Everyone seems to be talking like bitcoins will never go down again. Sounds a bit like folks were talking about houses a few years back.. :-P

I guess on the bright side it's sorta like a hedge; if the price of bitcoins goes down, you get more of your bitfloor coins faster :).

I would be willing to bet all my bitfloor coins that they will never again be as cheap as they were at the time of the hack.

I can't really complain about him playing it safe though.  I just don't think he'll ever be able to pay it all off unless he hedges at least some of it on the bitcoin side.  Yes, price can go down, but we are still very early in the price discovery phase.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on March 20, 2013, 01:56:14 AM
The company has a debt denominated in BTC.  The hedge would be to hold any profits in BTC.  Having a debt in BTC and holding assets in USD isn't a hedge, it is a short position.   Imagine if hypothetically Bitcoin rose to $500 USD per BTC.  Suddenly the company would owe $15M USD worth of debt.  I had hoped that bitfloor would seek outside investors make a deal to fix the debt to USD offer something like a 33% haircut, 33% repaid upfront, and 33% repaid over next x years.  As it is holding USD and watching the BTC denominated debt skyrocket is just a stone around the neck of bitfloor.


Title: Re: bitfloor needs your help!
Post by: ProfMac on March 20, 2013, 02:20:22 AM
The new FinCEN regs are going to put BitFloor out of business.  Adios, 12 BTC...

Oh?  What are the issues you see?


Title: Re: bitfloor needs your help!
Post by: qxzn on March 20, 2013, 02:01:10 PM
The company has a debt denominated in BTC.  The hedge would be to hold any profits in BTC.  Having a debt in BTC and holding assets in USD isn't a hedge, it is a short position.   Imagine if hypothetically Bitcoin rose to $500 USD per BTC.  Suddenly the company would owe $15M USD worth of debt.  I had hoped that bitfloor would seek outside investors make a deal to fix the debt to USD offer something like a 33% haircut, 33% repaid upfront, and 33% repaid over next x years.  As it is holding USD and watching the BTC denominated debt skyrocket is just a stone around the neck of bitfloor.

+1


Title: Re: bitfloor needs your help!
Post by: muyuu on March 20, 2013, 02:10:35 PM
The company has a debt denominated in BTC.  The hedge would be to hold any profits in BTC.  Having a debt in BTC and holding assets in USD isn't a hedge, it is a short position.   Imagine if hypothetically Bitcoin rose to $500 USD per BTC.  Suddenly the company would owe $15M USD worth of debt.  I had hoped that bitfloor would seek outside investors make a deal to fix the debt to USD offer something like a 33% haircut, 33% repaid upfront, and 33% repaid over next x years.  As it is holding USD and watching the BTC denominated debt skyrocket is just a stone around the neck of bitfloor.

Words of wisdom.

I hope shtylman reacts soon, because we seem to be shooting up to $100 and the situation is quickly becoming untenable.


Title: Re: bitfloor needs your help!
Post by: EnergyVampire on March 20, 2013, 03:22:20 PM
I agree, a little more communication about the held coins would help put minds at ease. Even a simple web page with the payback strategy & payout history would help.

As far as I understand, the price of the coins is irrelevent as others have mentioned on previous posts. The important factor is volume.

It would take Bitfloor a volume of ~333.5 BTC to repurchase 1 BTC. Assuming Shtylman distributes 100% of the revenues, this gives a total traded volume of ~8.25 Million BTC to get back all 25K coins.


Title: Re: bitfloor needs your help!
Post by: bb113 on March 20, 2013, 04:07:09 PM
I modified this to show the number of bitcoins that could have been bought had bitfloor been immediately buying coins at another exchange as fees were received (assuming price was the same at both exchanges).

http://i48.tinypic.com/fmosgn.png


updated script if someone wants to host it:
Code:

#Get Data from bitcoincharts
bitfloor<-read.table("http://bitcoincharts.com/t/trades.csv?symbol=bitfloorUSD&start=0",
                     sep=","
)

##Convert Times from Unix
times=matrix(nrow=nrow(bitfloor), ncol=6)
time.string=NULL
for(i in 1:nrow(bitfloor)){
  timeStamp<-ISOdatetime(1970,1,1,0,0,0) + bitfloor[i,1]
 
  date<-strsplit(as.character(timeStamp), " ")[[1]][1]
  yr<-as.numeric(strsplit(date, "-")[[1]][1])
  mo<-as.numeric(strsplit(date, "-")[[1]][2])
  day<-as.numeric(strsplit(date, "-")[[1]][3])
 
  ToD<-strsplit(as.character(timeStamp), " ")[[1]][2]
  hr<-as.numeric(strsplit(ToD, ":")[[1]][1])
  min<-as.numeric(strsplit(ToD, ":")[[1]][2])
  sec<-as.numeric(strsplit(ToD, ":")[[1]][2])
 
  times[i,]<-cbind(yr,mo,day,hr,min,sec)
  time.string<-rbind(time.string,as.character(timeStamp))
}

bitfloor<-cbind(times,bitfloor)
colnames(bitfloor)<-c("Yr","Mo","Day","Hr","Min","Sec","UnixT","Price","Vol")

##Set First Timestamp bitfloor was open after hack
post.hack.open.time<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==9 & bitfloor[,3]==21),],
  1)[7])

##Divide into pre and post hack data
pre.hack.bitfloor<-bitfloor[which(bitfloor[,7]<post.hack.open.time),]
post.hack.bitfloor<-bitfloor[which(bitfloor[,7]>(post.hack.open.time-1)),]

#Generate cumulative volume and fees
pre.hack.bitfloor<-cbind(pre.hack.bitfloor,
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9]),
                         cumsum(pre.hack.bitfloor[,8]*pre.hack.bitfloor[,9])*.005
)
colnames(pre.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")

post.hack.bitfloor<-cbind(post.hack.bitfloor,
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9]),
                          cumsum(post.hack.bitfloor[,8]*post.hack.bitfloor[,9])*.003
)
colnames(post.hack.bitfloor)[10:11]<-c("cumUSD.Vol","cumFee")
#

##Set Timestamp of first payout
payback.time.one<-as.numeric(head(
  bitfloor[which(bitfloor[,1]==2012 & bitfloor[,2]==12 & bitfloor[,3]==1),],
  1)[7])

##Split into pre and post payout
pre.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]<payback.time.one),]
post.payout.one<-post.hack.bitfloor[which(post.hack.bitfloor[,7]>(payback.time.one-1)),]

#Generate cumulative volume and fee data
pre.payout.one[,10:11]<-cbind(
  cumsum(pre.payout.one[,8]*pre.payout.one[,9]),
  cumsum(pre.payout.one[,8]*pre.payout.one[,9])*.003
)

post.payout.one[,10:11]<-cbind(
  cumsum(post.payout.one[,8]*post.payout.one[,9]),
  cumsum(post.payout.one[,8]*post.payout.one[,9])*.003
)
#

##Get months from unix timestamps
month.labels=data.frame()
for(y in 2012:2013){
  for(m in 1:12){
    unixT<-bitfloor[which(bitfloor[,1]==y & bitfloor[,2]==m),7][1]
    month.labels<-rbind(month.labels,cbind(unixT,month.name[m]))
  }
}
month.labels<-month.labels[which(!is.na(month.labels[,1])),]
month.labels<-month.labels[2:nrow(month.labels),]

##Misc
est.payed.back<-.017
Total.Value.Stolen<-25000*tail(bitfloor[,8],1)
Total.Value.Payed<-est.payed.back*Total.Value.Stolen

##Make Plots
png("bitfloor.png", height=800, width=1300, pointsize=15)
layout(matrix(c(1,1,1,3,2,2,2,4), 2, 4, byrow = TRUE))
plot(bitfloor[,7],bitfloor[,8], type="n", xaxt="n",
     xlab="Time",
     ylab="USD/BTC",ylim=c(0,(max(bitfloor[,8])+5)),
     main="Bitfloor Price History"
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.hack.bitfloor[,7],pre.hack.bitfloor[,8], col="Green")
lines(pre.payout.one[,7],pre.payout.one[,8], col="Red")
lines(post.payout.one[,7],post.payout.one[,8], col="Blue")
abline(v=payback.time.one)

plot(pre.hack.bitfloor[,7],pre.hack.bitfloor[,11], xaxt="n",
     xlab="Time",
     ylab="Cumulative Fees Generated (USD)",
     xlim=c(min(bitfloor[,7]),max(bitfloor[,7])),
     ylim=c(0,max(pre.hack.bitfloor[,11],pre.payout.one[,11],post.payout.one[,11])),
     type="l", lwd=3, col="Green",
     main=c("Bitfloor Cumulative Fee Revenue",
            "Before Hack Rate= 0.5%,   After Hack= 0.3%")
)
axis(1,at=as.numeric(as.matrix(month.labels[,1])),
     labels=as.character(month.labels[,2]))
lines(pre.payout.one[,7],pre.payout.one[,11],
      type="l", lwd=3, col="Red"
)
lines(post.payout.one[,7],post.payout.one[,11],
      type="l", lwd=3, col="Blue"
)
abline(v=payback.time.one)

barplot(c(
  Total.Value.Stolen,
  Total.Value.Payed
),
        ylab="USD", ylim=c(0,1.1*Total.Value.Stolen),
        names.arg=c(paste("Value Stolen=", Total.Value.Stolen),
                    paste("Value Payed=",Total.Value.Payed)),
        col=c("Red","Green"),
        main=paste("Estimated Payed Back=",100*est.payed.back,"%")
)

barplot(c(
  max(pre.payout.one[,11]),
  max(post.payout.one[,11])
),
        ylim=c(0,1.1*max(c(max(pre.payout.one[,11]),max(post.payout.one[,11])))),
        ylab="Fees Generated (USD)",
        names.arg=c(paste("Hack to First Payout=", round(max(pre.payout.one[,11]),1)),
                    paste("Since=",round(max(post.payout.one[,11]),1))),
        col=c("Red","Blue"),
        main=c("Fees Generated Since Hack",
               paste("Constant Buying:",round(sum(0.003*post.payout.one[,9]),1), "BTC"),
               paste("Buy Now:",round(max(post.payout.one[,11])/tail(post.payout.one[,8],1),1),"BTC")
        )
)
dev.off()






Title: Re: bitfloor needs your help!
Post by: Rassah on March 22, 2013, 03:43:23 PM
The new FinCEN regs are going to put BitFloor out of business.  Adios, 12 BTC...

Oh?  What are the issues you see?


I'm concerned about this, too. If Bitfloor doesn't have the required licenses, and is forced to buy the new license AND show that they have $100,000 in liquidity, which may be impossible for them to do, they may be forced to shut down, and everyone who was owed any BTC will be screwed.

Is there anything official from Bitfloor out there to let us know what the situation is?


Title: Re: bitfloor needs your help!
Post by: ProfMac on March 22, 2013, 03:51:13 PM
The new FinCEN regs are going to put BitFloor out of business.  Adios, 12 BTC...

Oh?  What are the issues you see?


I'm concerned about this, too. If Bitfloor doesn't have the required licenses, and is forced to buy the new license AND show that they have $100,000 in liquidity, which may be impossible for them to do, they may be forced to shut down, and everyone who was owed any BTC will be screwed.

Is there anything official from Bitfloor out there to let us know what the situation is?

I read the Texas Banking Commission rules some years back when I thought I might want to start an exchange with SLL/USD, but nothing that might apply to Bitcoin in the present.  I think I was dismayed then when an internet bank needed $10,000,000.

But I assume that the liquidity could come from investors.  If you think he needs it, and you have a strong interest in keeping his business alive, you might be forming a consortium and seeing what funding that consortium has the will to use, so that you are ready to act if the opportunity presents itself.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on March 27, 2013, 01:12:25 PM
Did bitfloor just make a payment?  No announcement but my books wouldn't balance and I login to see an unexplained increased in BTC.


Title: Re: bitfloor needs your help!
Post by: Rassah on March 27, 2013, 01:21:53 PM
What's a "bid for debt to gather enough?"


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 27, 2013, 01:23:35 PM
What's a "bid for debt to gather enough?"

https://bitcointalk.org/index.php?topic=159221.0


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on March 27, 2013, 01:50:53 PM
Did bitfloor just make a payment?  No announcement but my books wouldn't balance and I login to see an unexplained increased in BTC.

I got a payment. It looks like about 1% of the outstanding BTC debt. Good News!


Title: Re: bitfloor needs your help!
Post by: jwzguy on March 27, 2013, 02:39:40 PM
Another 50 years with no interest and Roman will have paid us back!!!
Or, you could incur legal expenses and spread FUD and make sure he has no way to pay back. Great idea!


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 27, 2013, 02:48:05 PM
Another 50 years with no interest and Roman will have paid us back!!!
Or, you could incur legal expenses and spread FUD and make sure he has no way to pay back. Great idea!


If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.


Title: Re: bitfloor needs your help!
Post by: ProfMac on March 27, 2013, 02:57:57 PM
Another 50 years with no interest and Roman will have paid us back!!!
Or, you could incur legal expenses and spread FUD and make sure he has no way to pay back. Great idea!


If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.

What can make you satisfied?


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 27, 2013, 03:02:32 PM
Another 50 years with no interest and Roman will have paid us back!!!
Or, you could incur legal expenses and spread FUD and make sure he has no way to pay back. Great idea!


If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.
Buy me out as well..!


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 27, 2013, 03:11:18 PM
Another 50 years with no interest and Roman will have paid us back!!!
Or, you could incur legal expenses and spread FUD and make sure he has no way to pay back. Great idea!


If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.

What can make you satisfied?


I don't know, honestly.  There is a serious principle at stake, and Bitcoin is getting to the point where stands need to be made on ethical grounds or the system will collapse, and the bubble pointers will shout I told you so.

I offered at 30 cents on the dollar right after the "theft".  This was at a time pirate debt was trading at 0.50.  There were no takers.  People preferred Pirate's debt to Roman's. 

Since Roman has never taken any input from us, or even responded to the many viable suggestions of how he could resolve the debt, I find the whole 'Bitfloor needs your help' plea to be repulsive.  Bitfloor seized my money.

And by the way; You are all welcome for the 1% payback I forced.


Title: Re: bitfloor needs your help!
Post by: jwzguy on March 27, 2013, 03:14:43 PM
If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.
Did he seize your money or is he bankrupt? Make up your mind.

Bitfloor is not a bank, and your solution is to waste a lot of time and money with the goal to make it harder for him to make people whole. Ask Bitcoinica holders how many payments they have gotten since the last hack.

If you disagree: you are not thinking clearly.



Title: Re: bitfloor needs your help!
Post by: jwzguy on March 27, 2013, 03:15:45 PM
And by the way; You are all welcome for the 1% payback I forced.
So in the end, you're just a delusional ass who wants attention. Got it.



Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 27, 2013, 03:17:45 PM
If you find it acceptable for operators of exchanges to seize your money then that is good for you.

I don't find it acceptable.  And Bitfloor is bankrupt.  There are enough bankrupt banks operating in the fiat world.  Bitcoin doesn't need any.

If you disagree:  Buy me out.
Did he seize your money or is he bankrupt? Make up your mind.

Bitfloor is not a bank, and your solution is to waste a lot of time and money with the goal to make it harder for him to make people whole. Ask Bitcoinica holders how many payments they have made back since the last hack.

If you disagree: you are not thinking clearly.



He is bankrupt.  He owes over $2M in BTC and does not have the funds.  In order to continue operating he has seized those funds from all depositors of BTC on his site.



Title: Re: bitfloor needs your help!
Post by: jwzguy on March 27, 2013, 03:19:32 PM
He is bankrupt.  He owes over $2M in BTC and does not have the funds.  In order to continue operating he has seized those funds from all depositors of BTC on his site.

Are you high?


Title: Re: bitfloor needs your help!
Post by: Rassah on March 27, 2013, 03:20:03 PM
Bitfloor seized my money.

Bitfloor didn't "seize" your money, there was no money to seize. It was stolen, remember. All Bitfloor did is say, "I screwed up, and I owe you this much money. I don't have ANY money now, but I will keep what I still owe you on the books, and pay it back as best I can whenever I get any money."

I think the most a lawsuit can accomplish is to force Bitfloor to acknowledge that they owe you money, put the debt they owe you on their books, and pay it back as best as they can whenever they get any money. Which is what they are doing already, anyway. At worst, you can just shut the business down completely, in which case, please buy all of the rest of US who are depending on him to repay us, FIRST.


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 27, 2013, 03:21:24 PM
Bitfloor seized my money.

Bitfloor didn't "seize" your money, there was no money to seize. It was stolen, remember. All Bitfloor did is say, "I screwed up, and I owe you this much money. I don't have ANY money now, but I will keep what I still owe you on the books, and pay it back as best I can whenever I get any money."

I think the most a lawsuit can accomplish is to force Bitfloor to acknowledge that they owe you money, put the debt they owe you on their books, and pay it back as best as they can whenever they get any money. Which is what they are doing already, anyway. At worst, you can just shut the business down completely, in which case, please buy all of the rest of US who are depending on him to repay us, FIRST.

Citation needed for that theft.

Where is the police report?


Title: Re: bitfloor needs your help!
Post by: Rassah on March 27, 2013, 03:36:12 PM
Citation needed for that theft.

Where is the police report?


Ooooooh, I see. You are just gambling on the idea that Bitfloor actually stole the money themselves, thus totally fucking up their reputation and business, while planning to continue to keep running their business instead of just running with the money (huh?) being completely open and public about who they are, how they screwed up, and how much they owe while trying to repay all the money from their business profits (wtf?), and actually still in fact have all those bitcoins stashed somewhere, while simultaneously being bankrupt (omgwtf!), while at the same time not even bothering to type "Bitfloor police report" into Google.

Yay derp derp derp.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 27, 2013, 04:18:48 PM
I am just upset at the lack of communication and payouts.  He used to be so active here, now he says nothing.  He doesn't indicate a regular period of when we can expect payouts.  He doesn't show calculations of how much the site has made in revenue vs the latest payment.  Heck, he didn't even pay out anything the last few months until today.

I can sympathize with his position. He'll likely never be able to pay back the entire BTC balance, so every hour he spends conducting activities for bitfloor, he's essentially working for free.  And that will likely never change.  That would be discouraging as hell.  But it still doesn't change what happened.  He needs to be in communication of some sort, or at the very least, give regular monthly payments.


Title: Re: bitfloor needs your help!
Post by: fcmatt on March 27, 2013, 04:22:17 PM
I am just upset at the lack of communication and payouts.  He used to be so active here, now he says nothing.  He doesn't indicate a regular period of when we can expect payouts.  He doesn't show calculations of how much the site has made in revenue vs the latest payment.  Heck, he didn't even pay out anything the last few months until today.

I can sympathize with his position. He'll likely never be able to pay back the entire BTC balance, so every hour he spends conducting activities for bitfloor, he's essentially working for free.  And that will likely never change.  That would be discouraging as hell.  But it still doesn't change what happened.  He needs to be in communication of some sort, or at the very least, give regular monthly payments.

Or make sure anyone owed a govt currency is paid.. and the rest who are owed bitcoin? well that is just a made up internet token and just
never pay it. walk away and never come back.

Sure someone might sue you but I doubt it would last very long in court once the details come out that the only thing lost was some "fake
internet tokens".

I am not dissing bitcoin. I am just saying it is the most likely path for this to play out.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 27, 2013, 04:31:07 PM
I am just upset at the lack of communication and payouts.  He used to be so active here, now he says nothing.  He doesn't indicate a regular period of when we can expect payouts.  He doesn't show calculations of how much the site has made in revenue vs the latest payment.  Heck, he didn't even pay out anything the last few months until today.

I can sympathize with his position. He'll likely never be able to pay back the entire BTC balance, so every hour he spends conducting activities for bitfloor, he's essentially working for free.  And that will likely never change.  That would be discouraging as hell.  But it still doesn't change what happened.  He needs to be in communication of some sort, or at the very least, give regular monthly payments.

Or make sure anyone owed a govt currency is paid.. and the rest who are owed bitcoin? well that is just a made up internet token and just
never pay it. walk away and never come back.

Sure someone might sue you but I doubt it would last very long in court once the details come out that the only thing lost was some "fake
internet tokens".

I am not dissing bitcoin. I am just saying it is the most likely path for this to play out.
I don't see how a court would view Bitcoins any differently than any other debt.  They would peg it to USD value for certain (potentially retroactively to the value at the date/time of the theft), and only make a judgement in USD, but it doesn't matter if someone owes me Bitcoins or they owe me bananas - it is still something of value that they are indebted to me for.

Bitfloor might also be protected by an LLC or something too, in which case, a lawsuit wouldn't matter.


Title: Re: bitfloor needs your help!
Post by: Rassah on March 27, 2013, 04:34:03 PM
I am just upset at the lack of communication and payouts.

That I agree with. Even the Google+ account (their announcement board) hasn't been updated in months. I'd like to see something from Roman, even if just to let us know that he's still alive  :P Even better would be some statements as to the state of the business, and maybe replies to any changes in the Bitcoin ecosphere, such as the effects of the recent price spike on repayments, or any statements in response to the FinCEN crap.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on March 27, 2013, 04:42:45 PM
Bitfloor might also be protected by an LLC or something too, in which case, a lawsuit wouldn't matter.

Clarification.  An LLC (or incorporation) doesn't protect the company.  It provides liability protection for the owners.  The reality is that like most Bitcoin based companies Bitfloor doesn't have any "real" (tangible) assets.  You can't get blood from a stone.  Unlike a company which has warehouses, inventory, office equipment, etc which can be liquidiated Bitfloor assets would be limited to the brand (which would be destroyed in a bankruptcy), and the code plus any operating capital.  Bitfloor has paid out excess operating capital on a quarterly basis so I doubt you are getting more there.

The reality is a lawsuit is in nobody best interest.  Between court costs, legal fees (including Bitfloor's legal fees which will deplete operating capital) even if one got a judgement for the full amount it simply means Bitfloor would be forced into bankruptcy and creditors would be lucky to get 5 cents on the dollar.  The liquidated value of Bitfloor (as opposed to operating value) is very low.

For those ganshing at the teeth for a lawsuit here is a practical excercise.

1) Estimate the cash on hand (both BTC & USD) that bitfloor has
2) Estimate what the assets (code base, customer lists) of bitfloor could be sold for in liquidation (note most assets liquidate for 10% to 30% of face value in BK).
3) Add 1 + 2 together and subtract bitfloor estimated legal fees.

3 is the total liquidation value of bitfloor.  Divide this by the current amount owed (in USD) and that is % each creditor could expect to receive in liquidation.  Now subtract legal fees.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 27, 2013, 06:15:23 PM
Bitfloor might also be protected by an LLC or something too, in which case, a lawsuit wouldn't matter.

Clarification.  An LLC (or incorporation) doesn't protect the company.  It provides liability protection for the owners.  The reality is that like most Bitcoin based companies Bitfloor doesn't have any "real" (tangible) assets.  You can't get blood from a stone.  Unlike a company which has warehouses, inventory, office equipment, etc which can be liquidiated Bitfloor assets would be limited to the brand (which would be destroyed in a bankruptcy), and the code plus any operating capital.  Bitfloor has paid out excess operating capital on a quarterly basis so I doubt you are getting more there.

The reality is a lawsuit is in nobody best interest.  Between court costs, legal fees (including Bitfloor's legal fees which will deplete operating capital) even if one got a judgement for the full amount it simply means Bitfloor would be forced into bankruptcy and creditors would be lucky to get 5 cents on the dollar.  The liquidated value of Bitfloor (as opposed to operating value) is very low.

For those ganshing at the teeth for a lawsuit here is a practical excercise.

1) Estimate the cash on hand (both BTC & USD) that bitfloor has
2) Estimate what the assets (code base, customer lists) of bitfloor could be sold for in liquidation (note most assets liquidate for 10% to 30% of face value in BK).
3) Add 1 + 2 together and subtract bitfloor estimated legal fees.

3 is the total liquidation value of bitfloor.  Divide this by the current amount owed (in USD) and that is % each creditor could expect to receive in liquidation.  Now subtract legal fees.
Well, that's exactly what I meant.  If Bitfloor was started as an LLC, then creditors aren't going to get jack diddly in a lawsuit, and Roman would just shrug it off since it wouldn't affect him directly.  If Bitfloor is NOT an LLC, then Roman's assets (whatever those may be) are at stake, and if nothing else, creditors looking for revenge would get the satisfaction of justice being served.

For me personally, I'd just like whatever option gets me the most of my money back, and I seriously doubt it'll come through a lawsuit.  But, I'd be willing to sell my debt for 0.1 BTC / BTC owed to whomever is interested, because I don't think we'll ever see that much in payback.  If that person wants to take my debt on a lawsuit with them, then all power to 'em.


Title: Re: bitfloor needs your help!
Post by: Rassah on March 27, 2013, 06:24:55 PM
What if later on there's a countersuit against whoever brought this suit, to try to recover lost potential repayments, and the person who brought this suit is not protected by any LLC, resulting in the remaining people who did not want the initial suit getting repaid from this initial suer's personal financial holdings? Could that happen?


Title: Re: bitfloor needs your help!
Post by: SgtSpike on March 27, 2013, 06:48:05 PM
What if later on there's a countersuit against whoever brought this suit, to try to recover lost potential repayments, and the person who brought this suit is not protected by any LLC, resulting in the remaining people who did not want the initial suit getting repaid from this initial suer's personal financial holdings? Could that happen?
...

Where is Nolo when you need him?   :D


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on March 27, 2013, 07:26:18 PM
Bitfloor has paid out excess operating capital on a quarterly basis so I doubt you are getting more there.

Since in the U.S. all debts can be repaid with USDs, the BTC debt is at the BTC/USD value from back in September when the incident occurred.  BitFloor is actually making good progress on repaying the $210K USD (wild guess from memory) that was owed.    For anyone hoping to receive the number of bitcoins on "hold", um ... ya.  Since those 24K BTC are now worth over $2 million, about the only hope for that size of repayment would be if BitFloor were to score somehow like through an acquisition or something like that.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on March 27, 2013, 07:50:42 PM
What if later on there's a countersuit against whoever brought this suit, to try to recover lost potential repayments, and the person who brought this suit is not protected by any LLC, resulting in the remaining people who did not want the initial suit getting repaid from this initial suer's personal financial holdings? Could that happen?
...

Where is Nolo when you need him?   :D

Exactly.  That is above my paygrade.  This is one of those questions where if you ask 3 lawyers you will get three different answers.  Ultimately it gets decided in court.


Title: Re: bitfloor needs your help!
Post by: bb113 on March 27, 2013, 07:51:17 PM
Bitfloor has paid out excess operating capital on a quarterly basis so I doubt you are getting more there.

Since in the U.S. all debts can be repaid with USDs, the BTC debt is at the BTC/USD value from back in September when the incident occurred.  BitFloor is actually making good progress on repaying the $210K USD (wild guess from memory) that was owed.    For anyone hoping to receive the number of bitcoins on "hold", um ... ya.  Since those 24K BTC are now worth over $2 million, about the only hope for that size of repayment would be if BitFloor were to score somehow like through an acquisition or something like that.

That's fine, but legal responsibility is not social responsibility. Also, thats 2 mil now. The exchange rate may drop sometime in the future.


Title: Re: bitfloor needs your help!
Post by: UNOE on March 27, 2013, 10:12:45 PM
I'm pretty happy I got a payment.  I just hope bitfloor changes the fee's to BTC rather than USD.  I'm not to worried about the 10 year length of time.  I'm hoping bitfloor volume goes up 10 fold then we will all be paid off in 1 year and Roman with have a nice profitable exchange, that has made a name for itself with integrity of fixing a mistake.
Good Luck to you Roman hope your exchange is around for years and is a big player when btc is traded at $3000 plus USD per coin.

Lastly no way I'm selling my debt for 5% lol


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on March 28, 2013, 01:17:56 AM
I am just upset at the lack of communication and payouts.  He used to be so active here, now he says nothing.  He doesn't indicate a regular period of when we can expect payouts.  He doesn't show calculations of how much the site has made in revenue vs the latest payment.  Heck, he didn't even pay out anything the last few months until today.

I can sympathize with his position. He'll likely never be able to pay back the entire BTC balance, so every hour he spends conducting activities for bitfloor, he's essentially working for free.  And that will likely never change.  That would be discouraging as hell.  But it still doesn't change what happened.  He needs to be in communication of some sort, or at the very least, give regular monthly payments.

Or make sure anyone owed a govt currency is paid.. and the rest who are owed bitcoin? well that is just a made up internet token and just
never pay it. walk away and never come back.

Sure someone might sue you but I doubt it would last very long in court once the details come out that the only thing lost was some "fake
internet tokens".

I am not dissing bitcoin. I am just saying it is the most likely path for this to play out.

I would agree with you, up until FinCEN defined bitcoin as a currency.  That is a huge game changer across the board, and specifically in this situation.


Title: Re: bitfloor needs your help!
Post by: ProfMac on March 28, 2013, 03:17:55 AM

What can make you satisfied?


I don't know, honestly.  There is a serious principle at stake, and Bitcoin is getting to the point where stands need to be made on ethical grounds or the system will collapse, and the bubble pointers will shout I told you so.

I offered at 30 cents on the dollar right after the "theft".  This was at a time pirate debt was trading at 0.50.  There were no takers.  People preferred Pirate's debt to Roman's. 

Since Roman has never taken any input from us, or even responded to the many viable suggestions of how he could resolve the debt, I find the whole 'Bitfloor needs your help' plea to be repulsive.  Bitfloor seized my money.

And by the way; You are all welcome for the 1% payback I forced.

After our shooting I spent a lot of time at the courthouse.  There is a lot of people watching there.  Another father lost a son in another case, and he was deeply (and justifiably) angry.  He wanted revenge.  It ate at him, and it worried everyone in the courthouse:  none of us wanted to be in any crossfire.

I wanted my daughter back.  Nothing else, only that.  I was clear that revenge would still leave her dead.

Both cases proceeded to a guilty verdict.  I was relieved that the trial was over, and I could spend time on the rest of my life, heal, find out who I was without my kid.  The other case also proceeded to a guilty verdict, with a death penalty.  That father just crumpled at the verdict:  he got what he had pursued for almost 2 years, and only when he had it did he realize it had no value to him.

Do you want Roman to be out of business?
Do you want him to be publicly humiliated?
Do you want him to be shut down?
Would you accept it if Roman is successful and repays everyone in time?

I like the idea of buying the debt.  I would make it a negotiable thing, and buy and sell it on an exchange.  It would end up in the hands of the people who can carry it, and those who have a liquidity crisis would get some liquidity now.  Bah, it sounds like I believe in markets.





Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 04, 2013, 05:00:18 AM
According to Bitcoincharts.com, Bifloor traded nearly a million dollars in volume today.  That's a daily commission of $2,700, and over a year, that totals $1 million dollars.

Now granted, this was an unusually high volume day, and the exchange can't be expected to match today's activity every day, especially not the weekends.

So to take a more conservative estimate, over the last month, nearly $5.1 million has been traded no Bitfloor.  Over a year, that yields commisions of $184,000.

Couple these estimates with two more observations:

1) The volume on Bitfloor has been rising very fast, much faster than any of the other exchanges over the last few months.

2) There's a lot of angst over Mt. Gox's performance of late.  People are looking for an alternative.

Granted, the debt it owes is growing just as fast, but exponential spikes like this are temporary and the price will settle down soon.  As one of the people who lost bitcoins in the heist, I'm hoping volume stays strong when the price wanes.

What I'm getting at is:

Bitfloor is making some serious money, and is growing very fast.  From a cash flow perspective, it's thriving.

The next time the price settles, the best thing for both people like me who are owed bitcoins and for Shtylman is to convert the BTC debt to dollar debt.  The debt will be paid off quickly the next time the price spikes, and Shtylman will start raking in some serious profits after the debt is cleared.


Title: Re: bitfloor needs your help!
Post by: jgarzik on April 04, 2013, 05:21:30 AM

It is ludicrous to demand that anyone who loses value X be repaid at value X*10.

Look at the exchange rate on the day of the hack, and return debt based on that.



Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 04, 2013, 06:00:12 AM
I don't really want to argue about this since nobody I've seen, Shtylman included, makes your argument.  But just for the hell of it:

1) The value of the missing bitcoins has grown by X*10.  That's a huge difference in what I'm missing.  For me personally, if those coins hadn't been stolen, I'd be contemplating retirement right now.  It's like a fork in my existence that decides what kind of life I will have.

2) Shtylman made the decision to allow cash withdrawals after the heist.  He could've said that everyone who had funds on the exchange, both dollars and BTCs, would take a haircut.  But he made a clear differentiation between cash holders and BTC holders.  He let cash holders withdraw their funds while BTC holders would
have nothing in their accounts.  By that decision, he's owes us BTCs, not cash.

3)  As I said originally, it can work out for all parties involved, Shtylman included, if the next time there's a stabilization in prices, he converts the BTC debt to dollar debt.  Everyone benefits in that scenario provided Bitcoin flourishes in the future (and if it doesn't, everyone, Shtylman included, loses whether or not the debt is paid back).


It is ludicrous to demand that anyone who loses value X be repaid at value X*10.

Look at the exchange rate on the day of the hack, and return debt based on that.




Title: Re: bitfloor needs your help!
Post by: malevolent on April 04, 2013, 06:09:16 AM
Wouldn't it be wiser to peg the debt to USD value at the time of the hack? I understand not everyone would like it but that's pretty much the only way the debt can be repaid and it is done this way on another exchange that lost money (bitmarket.eu).


Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 04, 2013, 06:25:37 AM
Thing is, I don't believe that's true.

Just as an example, there were about 24K BTCs stolen.  If the exchange were to stabilize at today's volume (6,500 BTCs), then every day, it would earn in commission 19.5 BTCs.  That would mean 3.37 years to pay off the BTCs if he converted his commissions to BTCs at the end of each day.  Obviously, that doesn't include operating costs, and today's volume may not stay constant, etc.

But I can wait 4 years.  

It might even be less time if the BTC debt is converted to dollar debt and the price keeps rising.

Shtylman started the exchange 1 year ago.  He could pay the debt off in 4 years.  Imagine starting a startup, and not earning much for the first 5 years, but then earning millions after that.  Wouldn't that work for you?  That's the situation he's in.  (A simplified scenario, obviously).

So far I haven't even talked about outside investors, but that's a way to pay off the debt even faster, whether via equity or bonds.  There are multi-million dollar investment houses looking for a way to get on the Bitcoin trade without enough liquidity at the exchanges to get on board.  Buying equity or debt in Bitfloor on a 3-4 year horizon might be an attractive alternative.



... but that's pretty much the only way the debt can be repaid....


Title: Re: bitfloor needs your help!
Post by: bb113 on April 04, 2013, 08:48:50 AM
I really don't understand: "convert btc debt into dollar debt". He buys bitcoin elsewhere, then credits your account and you can sell for this mythical stable price if you so choose. What is the advantage here?


Title: Re: bitfloor needs your help!
Post by: Rassah on April 04, 2013, 02:45:06 PM
As a bitcoin investor, obviously I would prefer to get what I was investing into, since as an investor I was expecting my investments to continue to grow, not stagnate (had I wanted that, I would've just put my money into a savings account).

But then, I may just be biased and greedy.

Also, since I'm investing long-term, I can wait for years to be paid back.
Also, with MtGox having scaling issues (lags), the concerns about them being too big, and a lot of newbies going to Bitfloor (MtGox having huge application ques), I don't think Bitfloor will have too much trouble paying off the debt.
Also, even if MtGox has a lot of trouble paying off the debt, if Bitcoin continues to grow, eventually a 5% return of what we're owed could STILL be worth way more than the value of what we lost.

That said, I would be concerned if Roman wasn't making enough profit for himself to make this be worth his while.


Title: Re: bitfloor needs your help!
Post by: SgtSpike on April 04, 2013, 03:40:21 PM
That said, I would be concerned if Roman wasn't making enough profit for himself to make this be worth his while.
That is my concern as well - that he has lost inspiration for the project.  It would suck to work hours a day on something that you won't see payouts on for four years.  But I know people do that all the time, so...

Another concern is whether he is MT/MSB registered, and whether he is doing the proper reporting.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on April 04, 2013, 03:49:51 PM
That said, I would be concerned if Roman wasn't making enough profit for himself to make this be worth his while.
That is my concern as well - that he has lost inspiration for the project.  It would suck to work hours a day on something that you won't see payouts on for four years.  But I know people do that all the time, so...

This.  Most of these creditors unrealistic goals assume repayment = 100% of gross revenue and that running bitfloor has no costs and Roman will gladly work for 3 to 5 years without any compensation.  Of course if the exchange rate goes higher and higher and higher the drive to repay creditors 1000%, 5000%, 20,000% of what they lost (in USD terms) for years and year and year is likely going to run dry.  Any debt scenario (any from loan shark to mortgage) involves benefit and risk for both parties.  When benefit/risk becomes significantly onsided then one entity will seek to end the agreement. 

For full disclosure TC, LLC sold our debt to a third party so I have no direct involvement however we do move some significant volume through bitfloor so our company has a vested interest in bitfloor being a solid growing exchange.

Quote
Another concern is whether he is MT/MSB registered

It is just MSB.  MT is just one classification of MSB.  Bitfloor is registered as an MSB (has been for sometime) although since it was prior to the FinCEN guidance IIRC the classification is "currency exchange" not "money transmitter".   All MSBs are subject to the same reporting, AML program, compliance officer, and third party audits.  It would make no sense for Roman to register (a defacto admission one believes they must be compliant) and then not comply.  My guess (no inside information) is that he is complying with MSB requirements.  He can file with FinCEN to have the MSB classification changed. 




Title: Re: bitfloor needs your help!
Post by: qxzn on April 04, 2013, 06:05:59 PM
That said, I would be concerned if Roman wasn't making enough profit for himself to make this be worth his while.
That is my concern as well - that he has lost inspiration for the project.  It would suck to work hours a day on something that you won't see payouts on for four years.  But I know people do that all the time, so...

I think it would be reasonable for him to split the revenues 50-50; take half for profit or further business development, and use the other half to make regular payments on the lost coins.

(full disclosure: I own a fair amount of bitfloor debt)


Title: Re: bitfloor needs your help!
Post by: SgtSpike on April 04, 2013, 07:26:16 PM
That said, I would be concerned if Roman wasn't making enough profit for himself to make this be worth his while.
That is my concern as well - that he has lost inspiration for the project.  It would suck to work hours a day on something that you won't see payouts on for four years.  But I know people do that all the time, so...

This.  Most of these creditors unrealistic goals assume repayment = 100% of gross revenue and that running bitfloor has no costs and Roman will gladly work for 3 to 5 years without any compensation.  Of course if the exchange rate goes higher and higher and higher the drive to repay creditors 1000%, 5000%, 20,000% of what they lost (in USD terms) for years and year and year is likely going to run dry.  Any debt scenario (any from loan shark to mortgage) involves benefit and risk for both parties.  When benefit/risk becomes significantly onsided then one entity will seek to end the agreement. 

For full disclosure TC, LLC sold our debt to a third party so I have no direct involvement however we do move some significant volume through bitfloor so our company has a vested interest in bitfloor being a solid growing exchange.

Quote
Another concern is whether he is MT/MSB registered

It is just MSB.  MT is just one classification of MSB.  Bitfloor is registered as an MSB (has been for sometime) although since it was prior to the FinCEN guidance IIRC the classification is "currency exchange" not "money transmitter".   All MSBs are subject to the same reporting, AML program, compliance officer, and third party audits.  It would make no sense for Roman to register (a defacto admission one believes they must be compliant) and then not comply.  My guess (no inside information) is that he is complying with MSB requirements.  He can file with FinCEN to have the MSB classification changed. 
Well, it is a relief bitfloor is MSB registered.  Thanks for clarifying that D&T.


Title: Re: bitfloor needs your help!
Post by: EuSouBitcoin on April 04, 2013, 10:24:39 PM

It is ludicrous to demand that anyone who loses value X be repaid at value X*10.

Look at the exchange rate on the day of the hack, and return debt based on that.



I think those that had X bitcoins on the day of the hack should be repaid X bitcoins, not 10X bitcoins.


Title: Re: bitfloor needs your help!
Post by: jwzguy on April 04, 2013, 11:11:46 PM

It is ludicrous to demand that anyone who loses value X be repaid at value X*10.

Look at the exchange rate on the day of the hack, and return debt based on that.



I think those that had X bitcoins on the day of the hack should be repaid X bitcoins, not 10X bitcoins.
I haven't seen anything to indicate that Roman disagrees with you.


Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 05, 2013, 01:59:08 AM

This.  Most of these creditors unrealistic goals assume repayment = 100% of gross revenue and that running bitfloor has no costs and Roman will gladly work for 3 to 5 years without any compensation.  Of course if the exchange rate goes higher and higher and higher the drive to repay creditors 1000%, 5000%, 20,000% of what they lost (in USD terms) for years and year and year is likely going to run dry.  Any debt scenario (any from loan shark to mortgage) involves benefit and risk for both parties.  When benefit/risk becomes significantly onsided then one entity will seek to end the agreement. 


I hope I've made it clear that these numbers are simplified, just to spur discussion.  I don't expect him to operate without expenses; nor do I expect him to not keep ANY profits for himself.  My message here is that Bifloor is growing like a weed, and there is a way for everyone to win here.  If not now, then very soon as it continues to grow.


Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 05, 2013, 02:09:13 AM
I really don't understand: "convert btc debt into dollar debt". He buys bitcoin elsewhere, then credits your account and you can sell for this mythical stable price if you so choose. What is the advantage here?

Suppose the current debt is 23,300 BTCs which equates to $3.27 million at the current price of $140.

He can pay it back in two ways:

1) Build up his commissions, which are in dollars, and periodically pay off the debt in bitcoins.  That means he accumulates dollars, then buys BTCs.  If the price of BTCs doubles to $280, he will still owe 23,300 BTCs which would equate to $6.54 million.  As the price of bitcoins grows, so does the dollar value of what he owes.

or

2) Take a loan for $3.27 million, buy 23,300 BTCs, return those BTCs to whom they are owed.  Then he needs to generate $3.27 million to pay back to whomever he borrowed from.  If the price of BTCs doubles to $280, his commissions will also double, and time taken to pay off the debt gets cut in half for a given volume of BTCs traded.

-----

If he had taken approach #2 after the heist, he would owe someone $250K, an amount he'll probably make in revenues in 2013.  Instead, he owes close to $3.27 million.  

Who would give him a loan for $3.27 million?  Maybe nobody.  But I think there could be investors out there.  With the growth in trading volume since the beginning of 2013, the revenue growth rate is astronomical.  Correct me if I'm wrong, but I think Bitfloor is the largest US based exchange.  As a user, I think it's fantastic, probably as good as any other exchange, if not better, out there.  There is huge room for growth here.

And he doesn't necessarily need to take a loan.  He could sell ownership of 49% of the company and still keep control.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 05, 2013, 03:58:55 AM
There is option #3: Take commission in BTC and use those BTC to pay down the loans. MtGox does about 2.3 mil of BTC in volume a month, meaning they rake in about 11,000 BTC in commissions alone. If Bitfloor continues to grow, and overall trade volume continues to grow, he may be able to make the 25,000 btc back in two years. Even if it takes 4, personally I would rather take the full amount of appreciating btc over 4 to 8 years, than a much smaller chunk of cash now.


Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 05, 2013, 04:27:55 AM
There is option #3: Take commission in BTC and use those BTC to pay down the loans. MtGox does about 2.3 mil of BTC in volume a month, meaning they rake in about 11,000 BTC in commissions alone. If Bitfloor continues to grow, and overall trade volume continues to grow, he may be able to make the 25,000 btc back in two years. Even if it takes 4, personally I would rather take the full amount of appreciating btc over 4 to 8 years, than a much smaller chunk of cash now.

That's very similar to what I meant in #1. To earn enough commissions to pay everything back in 2 years, he'd need an average trading volume of 10K per day. That's about 4x current levels. 

Having said that, the volume has risen by 4x over the last two months.

I still think if we assume long term increase in BTC prices, converting to dollar debt is a no brainier. If, for example, volume jumps to 10K per day and the price doubles, it would only take 1 year to get back to even.


Title: Re: bitfloor needs your help!
Post by: EnergyVampire on April 05, 2013, 11:38:24 PM
FYI:

"BitFloor will be offline for maintenance on 2013/4/6 from 3:00 AM to 6:00 AM EST (7 AM - 10AM UTC). The matching engine and trading will be unavailable during parts of this maintenance window as we improve our services. Deposits and withdrawals will continue to be processed."

Link: https://bitfloor.com/

So in another 8 hours or there abouts.


Title: Re: bitfloor needs your help!
Post by: Minor Miner on April 08, 2013, 10:42:14 PM

It is ludicrous to demand that anyone who loses value X be repaid at value X*10.

Look at the exchange rate on the day of the hack, and return debt based on that.



I find it strange that you think of the debt in fiat, not the bitcoin currency it was held in.   The loss was bitcoins, the debt is bitcoins, their F/X worth to other things is irrelevant.   I do not think anyone is asking to be re-paid 10X more bitcoins than they were owed.


Title: Re: bitfloor needs your help!
Post by: Han on April 09, 2013, 02:10:23 PM
If yall want to get your coins back ASAP, you'd best promote bitfloor's advantages: US based, cold storage security, advanced matching engine, etc. now that Roman's stopped posting on his lawyer's advice (except for routine service announcements).


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on April 09, 2013, 07:07:50 PM
If yall want to get your coins back ASAP, you'd best promote bitfloor's advantages: US based, cold storage security, advanced matching engine, etc. now that Roman's stopped posting on his lawyer's advice (except for routine service announcements).

Especially the cold storage security.


Title: Re: bitfloor needs your help!
Post by: muyuu on April 09, 2013, 07:23:45 PM
Does Roman have an address for donations? Sorry if it was already posted.


Title: Re: bitfloor needs your help!
Post by: qxzn on April 09, 2013, 09:15:26 PM
Does Roman have an address for donations? Sorry if it was already posted.

You could use this:

https://thewalletlist.com/api/lookup/rshtylman@bitfloor.com


Title: Re: bitfloor needs your help!
Post by: muyuu on April 10, 2013, 01:07:08 AM
Does Roman have an address for donations? Sorry if it was already posted.

You could use this:

https://thewalletlist.com/api/lookup/rshtylman@bitfloor.com

How can I be sure that address is correct? someone else could have listed his address, or it could be a compromised address.

I wouldn't want to send coins to the wrong person.


Title: Re: bitfloor needs your help!
Post by: qxzn on April 10, 2013, 01:41:28 AM

How can I be sure that address is correct? someone else could have listed his address, or it could be a compromised address.

I wouldn't want to send coins to the wrong person.

You can't be sure, and you're right to mistrust.

But, there's a decent chance it's right. So for small amounts, e.g. tips, you could use it.

But if you want to confirm that it gets to him, you'll probably have to contact him somehow.


Title: Re: bitfloor needs your help!
Post by: Han on April 10, 2013, 04:20:53 PM
Does Roman have an address for donations? Sorry if it was already posted.

You could always tip him through the bitcoin bot on reddit explained here: http://www.reddit.com/r/bitcointip/comments/13iykn/bitcointip_documentation/

Roman's reddit profile is here: http://www.reddit.com/user/shtylman


Title: Re: bitfloor needs your help!
Post by: Alonzo Ewing on April 11, 2013, 05:55:06 AM
Bitfloor turned over $2 million in volume today, yielding commissions of $6000. 


Title: Re: bitfloor needs your help!
Post by: Han on April 11, 2013, 10:52:32 AM
Bitfloor turned over $2 million in volume today, yielding commissions of $6000. 


The silver lining to the DDos attacks on the largest exchanges


Title: Re: bitfloor needs your help!
Post by: Rassah on April 11, 2013, 02:14:03 PM
Bitfloor turned over $2 million in volume today, yielding commissions of $6000. 


How do you get the $6,000 figure? Bitfloor charges 0.4% fee on transaction in both directions (so 0.4%*2), but actually pays market makers (people who put up a bid as a price and sit on it), so it's really difficult to predict how much of the volume earned fees and how much lost them.


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on April 11, 2013, 02:29:25 PM
Rassah,

There is always one maker and one taker for every transaction.  So Bitfloor collects 0.4% from the taker, and pays out 0.1% to the maker resulting in 0.3% net fee.  It isn't hard to predict the net fee.  It will always be 0.3% on every tx, every time. 


Title: Re: bitfloor needs your help!
Post by: Rassah on April 11, 2013, 02:43:27 PM
Rassah,

There is always one maker and one taker for every transaction.  So Bitfloor collects 0.4% from the taker, and pays out 0.1% to the maker resulting in 0.3% net fee.  It isn't hard to predict the net fee.  It will always be 0.3% on every tx, every time. 

Ah, thank you.


Title: Re: bitfloor needs your help!
Post by: marcus_of_augustus on April 11, 2013, 03:37:45 PM
might be time to change the OP title ... "Bitcoin needs bitfloor's help!"


Title: Re: bitfloor needs your help!
Post by: Minor Miner on April 11, 2013, 03:50:22 PM
might be time to change the OP title ... "Bitcoin needs bitfloor's help!"
I do not know if Bitcoin can take another "theft" of people's bitcoins by people who just dump the proceeds of their theft and drive the price lower.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 11, 2013, 07:24:14 PM
might be time to change the OP title ... "Bitcoin needs bitfloor's help!"
I do not know if Bitcoin can take another "theft" of people's bitcoins by people who just dump the proceeds of their theft and drive the price lower.

Sure it can. It's happened many times before, what's one more?
(Who's money got stolen this time?)


Title: Re: bitfloor needs your help!
Post by: edd on April 11, 2013, 10:07:51 PM
might be time to change the OP title ... "Bitcoin needs bitfloor's help!"
I do not know if Bitcoin can take another "theft" of people's bitcoins by people who just dump the proceeds of their theft and drive the price lower.

Sure it can. It's happened many times before, what's one more?
(Who's money got stolen this time?)

In addition, I don't see any evidence that dumping ill-gotten bitcoins is what's causing the falling exchange rate.


Title: Re: bitfloor needs your help!
Post by: Minor Miner on April 11, 2013, 10:38:26 PM
might be time to change the OP title ... "Bitcoin needs bitfloor's help!"
I do not know if Bitcoin can take another "theft" of people's bitcoins by people who just dump the proceeds of their theft and drive the price lower.

Sure it can. It's happened many times before, what's one more?
(Who's money got stolen this time?)

In addition, I don't see any evidence that dumping ill-gotten bitcoins is what's causing the falling exchange rate.
You misunderstood me (or I was not clear, same effect).   Someone made the statement that BITCOIN needs Bitfloor to save it.   My comment was we do not need another Bitfloor "security" screwup putting MORE bitcoins on the sell side of this market.


Title: Re: bitfloor needs your help!
Post by: EnergyVampire on April 11, 2013, 11:10:13 PM
FYI:

" Our servers are experiencing intermittent DDoS attacks. We are trying to resolve the situation for all of our users.

If you are coordinating a DDoS attack, please remember that bitcoin companies are not giant multinationals with huge support staff and computers. We are all involved because we want to see bitcoin succeed.

- Roman "

Link: https://status.bitfloor.com/


Title: https://status.bitfloor.com
Post by: ’A$HΕ on April 13, 2013, 09:54:56 PM
FYI:

" Our servers are experiencing intermittent DDoS attacks. We are trying to resolve the situation for all of our users.

If you are coordinating a DDoS attack, please remember that bitcoin companies are not giant multinationals with huge support staff and computers. We are all involved because we want to see bitcoin succeed.

- Roman "

Link: https://status.bitfloor.com/
Thoughtful of Roman to have this status page, but this does not help when they give no indication as to when they last updated the status.

Was it a week ago? Yesterday? 10 minutes ago? 1 month ago? 1 year?


Title: Re: bitfloor needs your help!
Post by: MOB on April 17, 2013, 09:21:56 PM
There is the following message on the announcement banner at BitFloor:

Trading will be suspended at 6 PM EST on 2013.04.17. We ask that all users finish any trades they wish to complete and cancel any open trades.



Seems oddly vague.  Suspended indefinitely?  For 12 hours?  Is this a server upgrade, or what?


Title: Re: bitfloor needs your help!
Post by: epetroel on April 17, 2013, 09:27:04 PM
There is the following message on the announcement banner at BitFloor:

Trading will be suspended at 6 PM EST on 2013.04.17. We ask that all users finish any trades they wish to complete and cancel any open trades.



Seems oddly vague.  Suspended indefinitely?  For 12 hours?  Is this a server upgrade, or what?

See here:

https://bitcointalk.org/index.php?topic=179135.0

Seems their bank account was closed and they will be suspending operations until they can get a new one.


Title: Re: bitfloor needs your help!
Post by: Stephen Gornick on April 17, 2013, 10:35:02 PM
From http://BitFloor.com:

Quote
All trading is currently suspended.

I am sorry to announce that due to circumstances outside of our control BitFloor must cease all trading operations indefinitely. Unfortunately, our US bank account is scheduled to be closed and we can no longer provide the same level of USD deposits and withdrawals as we have in the past. As such, I have made the decision to halt operations and return all funds.

Over the next days we will be working with all clients to ensure that everyone receives their funds. Please be patient as we process your request.

- Roman
founder - bitfloor.com


Related threads:

Bitfloor trading suspended
 - http://bitcointalk.org/index.php?topic=179198.

Bitfloor Shutting Down?
 - http://bitcointalk.org/index.php?topic=179152.0

Bitflloor: " Trading will be suspended at 6 PM EST on 2013.04.17."
 - http://bitcointalk.org/index.php?topic=179168.0

bitfloor issues?
 - http://bitcointalk.org/index.php?topic=179135.0


Title: Re: bitfloor needs your help!
Post by: marcus_of_augustus on April 17, 2013, 11:19:00 PM
Ugly, the jackboot of banking begins to reveal itself.


Title: Re: bitfloor needs your help!
Post by: smoothie on April 17, 2013, 11:21:55 PM
As much as I regret the post I am about to write I feel that it is only fair and holding to the spirit of BitFloor that I disclose everything that is going on and make the information available. Please read the entirety of the post. As always, if you have any questions please post them here versus contacting support so that other users may benefit from the answer (unless it is private).

Last night, a few of our servers were compromised. As a result, the attacker gained accesses to an unencrypted backup of the wallet keys (the actual keys live in an encrypted area). Using these keys they were able to transfer the coins. This attack took the vast majority of the coins BitFloor was holding on hand. As a result, I have paused all exchange operations. Even tho only a small majority of the coins are ever in use at any time, I felt it inappropriate to continue operating not having the capability to cover all account balances for BTC at the time.

Due to the serious nature of what has happened I am currently evaluating options for BitFloor. One of the last things I want to happen is for BitFloor to shutdown and cause more panic in the bitcoin community. The platform itself is very valuable and provides an important and friendly service to many users.
BitFloor is very much focused on the end user and creating a reliable and trusted platform for everyone. Through exchange user support, I can continue to operate BitFloor. I believe that posting the exchange source and being even more transparent about operations would be a step in this direction if we were to continue operating. BitFloor is currently the #4 USD exchange and #1 in the US.

As a last resort, I will be forced to fully shut BitFloor down and initiate account repayment using current available funds. I still have all of the logs for accounts, trades, transfers. I know exactly how much each user currently has in their account for both USD and BTC. No records were lost in this attack.

I realize that saying that I appreciate everyone's understanding is a moot point, however I do wish to re-iterate that my goal is to find the best and most reasonable way forward for BitFloor customers and the exchange and not create more panic that the community has already seen time and time again.

I would like to keep this thread focused on evaluating ideas of BitFloor operation and will create a separate thread for discussion (see below) about the actual transactions and tracing the coin theft. I will not speak at detail about the actual breach at this time as my current focus is on the future and not the past.

In the intrest of information for tracking stolen coins:
https://bitcointalk.org/index.php?topic=105819.0

~Roman

Wow so they are closing up shop for a second time.

You guys learn your lessons yet?

I certainly won't touch a US-based bitcoin exchange ever. Until the trust factor has been built up over time.


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on April 17, 2013, 11:29:40 PM
As much as I regret the post I am about to write I feel that it is only fair and holding to the spirit of BitFloor that I disclose everything that is going on and make the information available. Please read the entirety of the post. As always, if you have any questions please post them here versus contacting support so that other users may benefit from the answer (unless it is private).

Last night, a few of our servers were compromised. As a result, the attacker gained accesses to an unencrypted backup of the wallet keys (the actual keys live in an encrypted area). Using these keys they were able to transfer the coins. This attack took the vast majority of the coins BitFloor was holding on hand. As a result, I have paused all exchange operations. Even tho only a small majority of the coins are ever in use at any time, I felt it inappropriate to continue operating not having the capability to cover all account balances for BTC at the time.

Due to the serious nature of what has happened I am currently evaluating options for BitFloor. One of the last things I want to happen is for BitFloor to shutdown and cause more panic in the bitcoin community. The platform itself is very valuable and provides an important and friendly service to many users.
BitFloor is very much focused on the end user and creating a reliable and trusted platform for everyone. Through exchange user support, I can continue to operate BitFloor. I believe that posting the exchange source and being even more transparent about operations would be a step in this direction if we were to continue operating. BitFloor is currently the #4 USD exchange and #1 in the US.

As a last resort, I will be forced to fully shut BitFloor down and initiate account repayment using current available funds. I still have all of the logs for accounts, trades, transfers. I know exactly how much each user currently has in their account for both USD and BTC. No records were lost in this attack.

I realize that saying that I appreciate everyone's understanding is a moot point, however I do wish to re-iterate that my goal is to find the best and most reasonable way forward for BitFloor customers and the exchange and not create more panic that the community has already seen time and time again.

I would like to keep this thread focused on evaluating ideas of BitFloor operation and will create a separate thread for discussion (see below) about the actual transactions and tracing the coin theft. I will not speak at detail about the actual breach at this time as my current focus is on the future and not the past.

In the intrest of information for tracking stolen coins:
https://bitcointalk.org/index.php?topic=105819.0

~Roman

Wow so they are closing up shop for a second time.

You guys learn your lessons yet?

I certainly won't touch a US-based bitcoin exchange ever. Until the trust factor has been built up over time.

I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

Who could have seen this coming?


Title: Re: bitfloor needs your help!
Post by: alkhdaniel on April 17, 2013, 11:50:11 PM
Any information on people from outside US with USD in bitfloor, is it bye bye?


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on April 18, 2013, 02:15:27 AM
I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

What money seized?  bitfloor has paid out BTC withdraw requests and has paid out ACH withdraw requests yesterday.  We will see in 48 hours if they are paying out current ACH withdraw requests.

So what seized money are you talking about?


Title: Re: bitfloor needs your help!
Post by: Entropy-uc on April 18, 2013, 02:20:28 AM
I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

What money seized?  bitfloor has paid out BTC withdraw requests and has paid out ACH withdraw requests yesterday.  We will see in 48 hours if they are paying out current ACH withdraw requests.

So what seized money are you talking about?

How about the money you gained at my expense by getting a preferential payout from the last 'hack'?

When I tried to sell to a third party Roman specifically intervened and said that BTC owed were not transferable.  Yet you were able to sell your bad debt off.

No wonder you are such a fan of this failed business.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 18, 2013, 02:22:34 AM
I certainly won't touch a US-based bitcoin exchange ever. Until the trust factor has been built up over time.

So, where do you trade at if not Bitfloor or MtGox (which is moving US portion into US)?


Title: Re: bitfloor needs your help!
Post by: justusranvier on April 18, 2013, 02:24:09 AM
Months later; what is the feeling about Bitfloor now?
I use Bitfloor, but my money never stays on the exchange for more than the few minutes it takes between when the LocalTill deposit clears, I execute a market order, and withdraw bitcoins to my own wallet.
This is why.

Not to single out Bitfloor though. This is the same policy I use for any exchange.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 18, 2013, 02:24:56 AM
How about the money you gained at my expense by getting a preferential payout from the last 'hack'?


What? What was that about? Can you elaborate please?


Title: Re: bitfloor needs your help!
Post by: DeathAndTaxes on April 18, 2013, 02:32:47 AM
I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

What money seized?  bitfloor has paid out BTC withdraw requests and has paid out ACH withdraw requests yesterday.  We will see in 48 hours if they are paying out current ACH withdraw requests.

So what seized money are you talking about?

How about the money you gained at my expense by getting a preferential payout from the last 'hack'?

When I tried to sell to a third party Roman specifically intervened and said that BTC owed were not transferable.  Yet you were able to sell your bad debt off.

No wonder you are such a fan of this failed business.

Stop spreading lies.  I transferred rights to the debt but the balance is still on my account.  Roman didn't help, he told me the exact smae thing (a mistake IMHO).  When bitfloor makes a payment, it posts to my account,  I contact the buyer and forward the funds to him.  You could have done the exact same thing, nothing prevented you.  The fact that you lack imagination falls on you nobody else.

Keep your slander to yourself.  Of course this has nothing to do with your current lie/FUD.  Nothing has been seized by bitfloor.  BTC withdrawals have been paid.  ACH withdrawals are in progress.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 18, 2013, 02:38:12 AM
How about the money you gained at my expense by getting a preferential payout from the last 'hack'?

When I tried to sell to a third party Roman specifically intervened and said that BTC owed were not transferable.  Yet you were able to sell your bad debt off.

Oh! You think that no one was able to pull their debt Bitcoin out, but DeathAndTaxes got preferential treatment and Bitfloor allowed him to pull his portion of the stolen coins out?
Yeah, trust me, that's not what happened. Bitfloor did not give any special treatment to anyone.


Title: Re: bitfloor needs your help!
Post by: Inaba on April 18, 2013, 03:41:25 AM
I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

What money seized?  bitfloor has paid out BTC withdraw requests and has paid out ACH withdraw requests yesterday.  We will see in 48 hours if they are paying out current ACH withdraw requests.

So what seized money are you talking about?

How about the money you gained at my expense by getting a preferential payout from the last 'hack'?

When I tried to sell to a third party Roman specifically intervened and said that BTC owed were not transferable.  Yet you were able to sell your bad debt off.

No wonder you are such a fan of this failed business.

Stop spreading lies.  I transferred rights to the debt but the balance is still on my account.  Roman didn't help, he told me the exact smae thing (a mistake IMHO).  When bitfloor makes a payment, it posts to my account,  I contact the buyer and forward the funds to him.  You could have done the exact same thing, nothing prevented you.  The fact that you lack imagination falls on you nobody else.

Keep your slander to yourself.  Of course this has nothing to do with your current lie/FUD.  Nothing has been seized by bitfloor.  BTC withdrawals have been paid.  ACH withdrawals are in progress.

Entropy lying?  I am SHOCKED!  SHOCKED I SAY!  It's not like he doesn't have a history of it or anything...

But anyway... what happens to the debut that's till owed?  I have some active BTC in my account, I expect it will be paid out.. but what about the 288 BTC that's still on "hold" ?  Goes poof I assume?


Title: Re: bitfloor needs your help!
Post by: Minor Miner on April 18, 2013, 03:49:59 AM
I am shocked, SHOCKED to hear that people are having their money seized by Bitfloor once again.

What money seized?  bitfloor has paid out BTC withdraw requests and has paid out ACH withdraw requests yesterday.  We will see in 48 hours if they are paying out current ACH withdraw requests.

So what seized money are you talking about?

How about the money you gained at my expense by getting a preferential payout from the last 'hack'?

When I tried to sell to a third party Roman specifically intervened and said that BTC owed were not transferable.  Yet you were able to sell your bad debt off.

No wonder you are such a fan of this failed business.
Josh;
I am not sure you should be calling anyone a liar.   Are you too busy shipping product to your disappointed customers to be on here?   Or, did you finish all your shipping last week?   Or do you only ship NEXT WEEK?
You are a real POS.


Stop spreading lies.  I transferred rights to the debt but the balance is still on my account.  Roman didn't help, he told me the exact smae thing (a mistake IMHO).  When bitfloor makes a payment, it posts to my account,  I contact the buyer and forward the funds to him.  You could have done the exact same thing, nothing prevented you.  The fact that you lack imagination falls on you nobody else.

Keep your slander to yourself.  Of course this has nothing to do with your current lie/FUD.  Nothing has been seized by bitfloor.  BTC withdrawals have been paid.  ACH withdrawals are in progress.

Entropy lying?  I am SHOCKED!  SHOCKED I SAY!  It's not like he doesn't have a history of it or anything...

But anyway... what happens to the debut that's till owed?  I have some active BTC in my account, I expect it will be paid out.. but what about the 288 BTC that's still on "hold" ?  Goes poof I assume?



Title: Re: bitfloor needs your help!
Post by: muyuu on April 18, 2013, 06:30:36 AM
I certainly won't touch a US-based bitcoin exchange ever. Until the trust factor has been built up over time.

So, where do you trade at if not Bitfloor or MtGox (which is moving US portion into US)?

Bitstamp, Bitcoin.de, BTC-e, etc I assume.


Title: Re: bitfloor needs your help!
Post by: crazy_rabbit on April 18, 2013, 06:37:09 AM
I certainly won't touch a US-based bitcoin exchange ever. Until the trust factor has been built up over time.

So, where do you trade at if not Bitfloor or MtGox (which is moving US portion into US)?

Bitstamp, Bitcoin.de, BTC-e, etc I assume.

I have been happy with Bitstamp.


Title: Re: bitfloor needs your help!
Post by: jojo69 on April 18, 2013, 05:04:04 PM

Entropy lying?  I am SHOCKED!  SHOCKED I SAY!  It's not like he doesn't have a history of it or anything...

But anyway... what happens to the debut that's till owed?  I have some active BTC in my account, I expect it will be paid out.. but what about the 288 BTC that's still on "hold" ?  Goes poof I assume?


pot, meet kettle,  kettle, pot

you two should have a lot to talk about


Title: Re: bitfloor needs your help!
Post by: BoardGameCoin on April 18, 2013, 05:47:45 PM
I also am curious about the status of the BTC debt?

-bgc


Title: Re: bitfloor needs your help!
Post by: ivanc on April 21, 2013, 12:48:03 PM
People who think the debt should be payed in Bitcoin are completely non-sensical.
The debt equals to the value of the holdings at the time of the hack.
This value can be denominated in USD, BTC or whatever reserve of value.
For example, if you want to denominate the debt in USD, the value equals the USD equivalent at the time of the hack corrected with the inflation rate since the time of the hack + interest rate.
If you want to denominate the debt in BTC, you have to correct the value of the holdings at the time of the hack with the inflation rate of BTC since the time of the hack (as you know, for bitcoin this inflation rate is very negative).

I won't comment or correct all other non-sensical comments but some of you guys need a serious valuation course before posting here.


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on April 21, 2013, 04:32:08 PM
Entropy lying?  I am SHOCKED!  SHOCKED I SAY!  It's not like he doesn't have a history of it or anything...

But anyway... what happens to the debut that's till owed?  I have some active BTC in my account, I expect it will be paid out.. but what about the 288 BTC that's still on "hold" ?  Goes poof I assume?

Lmao look who found his voice.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 22, 2013, 12:25:00 AM
People who think the debt should be payed in Bitcoin are completely non-sensical.
The debt equals to the value of the holdings at the time of the hack.
This value can be denominated in USD, BTC or whatever reserve of value.
For example, if you want to denominate the debt in USD, the value equals the USD equivalent at the time of the hack corrected with the inflation rate since the time of the hack + interest rate.

I think you may be missing the investment potential part of the value. Also, if the debt was denominated in Argentine Pesos value, Bitfloor would only have to pay out 1/6th of the USD value now. So... why USD? And isn't "value" rather arbitrary?


Title: Re: bitfloor needs your help!
Post by: Rassah on April 22, 2013, 12:28:03 AM
Roman posted in my thread that he wouldn't support any transfers, and killed any offers for the debt.

I'm pretty sure he posted that in DeathandTaxes's thread, too, so what's your point?

No one was willing to offer even pennies on the BTC at the time.

How is that Roman's or DeathandTaxes's fault?


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on April 22, 2013, 05:49:01 PM
Roman posted in my thread that he wouldn't support any transfers, and killed any offers for the debt.

I'm pretty sure he posted that in DeathandTaxes's thread, too, so what's your point?

No one was willing to offer even pennies on the BTC at the time.

How is that Roman's or DeathandTaxes's fault?

Actually they had offers, but Roman is financially inept and in general mentally unprepared to lead any sort of venture. He may be able to code, but he needs to be an employee and obey management. He's unable to self manage.


Title: Re: bitfloor needs your help!
Post by: Rassah on April 22, 2013, 09:54:14 PM
Actually they had offers, but Roman is financially inept and in general mentally unprepared to lead any sort of venture. He may be able to code, but he needs to be an employee and obey management. He's unable to self manage.

Congrats on winning your Hindsight 20/20 prize. Have a gold star *

The topic at hand, though, is specifically offloading the debt that Bitfloor owed to you. In DeathandTaxes's case, Bitfloor owed him 200BTC, and although Bitfloor was not willing to do anything with the debt other than hold it on their books and attempt to repay it, Deathandtaxes was able to offload it to someone else in a private contract. Entropy just wasn't as lucky.


Title: Re: bitfloor needs your help!
Post by: MPOE-PR on April 23, 2013, 10:11:48 AM
Congrats on winning your Hindsight 20/20 prize. Have a gold star *

The topic at hand, though, is specifically offloading the debt that Bitfloor owed to you. In DeathandTaxes's case, Bitfloor owed him 200BTC, and although Bitfloor was not willing to do anything with the debt other than hold it on their books and attempt to repay it, Deathandtaxes was able to offload it to someone else in a private contract. Entropy just wasn't as lucky.

Thanks for the hindsight gold star! I recall this thread about you selling out of BTC ~15 or w/e it was a month or so ago, so I guess of everyone in Bitcoin you might be the most highly qualified authority to dispense these.  ;D


Title: Re: bitfloor needs your help!
Post by: Rassah on April 23, 2013, 03:21:02 PM
Congrats on winning your Hindsight 20/20 prize. Have a gold star *

The topic at hand, though, is specifically offloading the debt that Bitfloor owed to you. In DeathandTaxes's case, Bitfloor owed him 200BTC, and although Bitfloor was not willing to do anything with the debt other than hold it on their books and attempt to repay it, Deathandtaxes was able to offload it to someone else in a private contract. Entropy just wasn't as lucky.

Thanks for the hindsight gold star! I recall this thread about you selling out of BTC ~15 or w/e it was a month or so ago, so I guess of everyone in Bitcoin you might be the most highly qualified authority to dispense these.  ;D


It was at $22, but yep. Sucks to have missed out on the nice rise in price, but at least I'm not going to be affected by the wild swings any more.


Title: Re: bitfloor needs your help!
Post by: UNOE on April 26, 2013, 06:00:46 AM
Let me know if anyone is doing anything about the debt.  I have a good amount owed to me and don't want to see it walk away.


Title: Re: bitfloor needs your help!
Post by: notme on April 28, 2013, 02:00:56 AM
Let me know if anyone is doing anything about the debt.  I have a good amount owed to me and don't want to see it walk away.

Good luck. They owe me 14 BTC, but I doubt I'll ever see any of it again.


Title: Re: bitfloor needs your help!
Post by: LorenzoMoney on May 05, 2013, 04:06:06 PM
Just discovered that the money which had been sent from my Capital One 360 to Bitfloor before their shutdown was return to me.  Thank you Bitfloor for sending my money back to me.

I liked using the Bitfloor site more than any other US based site and it  is always sad when any bitcoin exchange goes out of business. We need more exchanges not less.

Hopefully, the Bitfloor Boys will get things back together and will find a way to navigate money laws and timid banks and will get their exchange back up.

Until then, I am thrilled to have my money back from Bitfloor.



Title: Re: bitfloor needs your help!
Post by: BCB on May 05, 2013, 09:27:10 PM
Don't know anything about these new US exchanges.

https://bitbox.mx (https://bitbox.mx)
(I've traded with him personally)

https://beta.kraken.com/ (https://beta.kraken.com/)

https://www.crypto.st/ (https://www.crypto.st/)


Title: Re: bitfloor needs your help!
Post by: JWU42 on May 11, 2013, 09:22:03 PM
Still waiting for an update with some substance...

A check was supposedly sent on April 20th closing out the account.  A short update on May 1 saying

Quote
We are still waiting to hear back from the bank regarding our remaining account balance.

Sadly nothing since then...


Title: Re: bitfloor needs your help!
Post by: FenixRD on May 15, 2013, 09:37:24 AM
Still waiting for an update with some substance...

A check was supposedly sent on April 20th closing out the account.  A short update on May 1 saying

Quote
We are still waiting to hear back from the bank regarding our remaining account balance.

Sadly nothing since then...

Attempting some progress in the exchange community... https://bitcointalk.org/index.php?topic=205881.0


Title: Re: bitfloor needs your help!
Post by: JWU42 on May 15, 2013, 12:10:32 PM
Progress (I hope) - posted on the website yesterday...

Quote
2013.05.13

We have received the check and are working on a way to start returning funds. We do not yet have an ETA, but understand everyone is anxious to get their money back and we are trying to make that happen as quickly as possible.


Title: Re: bitfloor needs your help!
Post by: vegascoins on June 06, 2013, 03:00:21 AM
Any progress on this?


Title: Re: bitfloor needs your help!
Post by: Rassah on June 06, 2013, 03:07:23 AM
Any progress on this?

You're on the wrong thread. That discussion was moved to https://bitcointalk.org/index.php?topic=179135.420