Ask yourself this, how can they afford to pay out those kind of interest rates?
Two Weeks - 3% Interest One Month - 10% Interest 3 Months - 40% Interest That just screams Ponzi scheme.
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Anyone know how you can get money to BitInstant or Mt.Gox for less than 5% (and no, I'm not moving over 10k, it's fairly trivial volume, probably under $1000).
You probably don't want to send money to Mt. Gox right now. Read the other threads about their problems, and the comments on their Facebook page.Investigate before you invest. Really.
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Quit patting yourself on the back.
I've never seen so many con men and marks together in the same place.
The Bitcoin world has reproduced in miniature almost every financial scam known, from pump and dump to blind pools to bucket shops to front-running. There are plenty of marks on here who have no clue how to recognize a con game. It's embarrassing.
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This is even worse than I thought. Stalling on withdrawals didn't start on June 20; it goes back further. Paul Vigna, a reporter at the Wall Street Journal, is covering this story. I've talked to him. He can be reached at Paul.Vigna@wsj.com. He would like to hear from people who are having trouble getting substantial amounts of money out of Mt. Gox.
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Of course, they have the right, definitely. Maybe you all should just take a look at Goxs business conditions: To the extent permitted by law, Mt. Gox will not be held liable for any damages, loss of profit, loss of revenue, loss of business, loss of opportunity, loss of data, indirect or consequential loss unless the loss suffered is caused by a breach of these Terms by Mt. Gox.
That won't help Mt. Gox. The Japan Consumer Contract Act voids such clauses:Section 2 Nullity of Consumer Contract Clauses Article 8 (Nullity of Clauses which Exempt a Business Operator from Liability for Damages)
(1) The following clauses of a consumer contract are void. (i) Clauses which totally exclude a business operator from liability to compensate damages to a consumer arising from the business operator 's default.
(ii) Clauses which partially exclude a business operator from liability to compensate damages to a consumer arising from the business operator 's default (such default shall be limited to cases where same arises due to the intentional act or gross negligence on the part of the business operator, the business operator's representative or employee). ...
Read the full text at the link. Japan law doesn't allow clauses like the one Mt. Gox uses. Note another term in the Mt. Gox agreement: Mt. Gox represents and warrants that: ... it will hold all monetary sums and all Bitcoins deposited by each Member in its Account, in that Member's name as registered in their Account details, and on such Member's behalf.
That's an obligation to segregate customer assets from Mt. Gox's own assets. It's also a requirement of the Japan Payment Services Act, which is enforced by the Japan Financial Services Agency. So Mt. Gox cannot get off the hook with some disclaimer in their terms of service.
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Well, sure, and I agree with your judgment there, but we're humans... I'm just wondering if anybody's managed to get an algo to make that judgment (without hindsight).
It sort of happens automatically. The arbitrage 'bot runs out of cash. Arbitrage is done with the same money going round and round. With today's prices, an arbitrage bot would be trying to sell Bitcoins on Mt. Gox and buy Bitcoins on Bitstamp in equal amounts. But there has to be available cash on Bitstamp to do this. That cash is supposed to be refilled from sales on Mt. Gox. With Mt. Gox defaulting on withdrawals, that's not happening. So arbitrage stops when the cash runs out on Bitstamp. If someone had heavily funded an arbitrage 'bot, they may have ended up with a big USD balance on Mt. Gox. Now they're stuck.
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The main thing here is doing something. It doesn't matter if you have made astronomical profit or not, Mt. Gox doesn't have the right to be handling things in the way they are. Answers will slowly be demanded and if they aren't given, pressure is going to build to a point where people start doing something. Starting with a small claim where they are based in the US is a good way to get some attention.
That was my point. It's past time to do something. There are things that can be done. The actual location of Mt. Gox, according to a filing in the Coinlab lawsuit, is Tōkyō-to, Shibuya-ku, Shibuya, 2丁目11−6. 5th floor. About 300 meters east of Shibuya station.
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That Ponzi scheme collapsed last year. The guy behind it ripped off people for around $5 million. The SEC has charged him with a crime, which is what they're supposed do. It was a classic Ponzi scheme ("7% a month returns"); it just happened to involve Bitcoins.
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What I really want to know is whether people running arbitrage bots are taking all of this into account. I shut mine off five or six months ago when I no longer had time to monitor them, but this was something I always worried about. To a bot doing price arbitrage this thing is a black hole of death… the dying exchange actively sucks in the arbitrageurs with its rising prices. If you let your bots move coins unattended it will actually pull all your coins across the net to the doomed exchange Arbitrage involving Mt. Gox is dead. When you can't get cash out, you can only trade it once. Hence the big spreads - the arbitrageurs are stuck. Today's spread between Mt. Gox and other exchanges is about 8% - 9%. If traders were getting money out, that spread would drop to the cost of doing a round-trip trade, which is supposedly under 2% for the two trades involved.
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The Delaware option is not that expensive at all, especially if you are on the East Coast already. $15k is a great limit as well, we don't get that high of a ruling amount in CA. It would cost the trip to Delaware and about $40 for the filing fee (give or take a few extra $10 fees im sure). Here's the link to the courts: http://courts.delaware.gov/JPCourt/index.stmAll the filing could be done online and all you would have to do is show up, hardly an effort if you have $15k waiting in Mt. Gox withdrawal land. Good point. If Mt. Gox sends someone, you get to ask questions about where your money is. With them under oath, under penalty of perjury. "We have a backlog processing withdrawals" has zero value as a defense in court. My guess is that if you file suit, you will get paid before it goes to court. Mt. Gox doesn't want to answer hard questions under oath. Nor do they want a default judgement against them, which is what happens if they don't send someone. (I once had a disagreement with Freelancer.com, which is in New South Wales, Australia. The small claims court there accepts online filings. I filled out the appropriate forms and sent a copy to Freelancer.com. I had an answer from them within hours and a wire transfer in my bank account the next day. That's what usually happens when you sue and the other side knows they have a losing case.)
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And by "insolvent", I mean that in the technical sense - I don't think Gox has immediate access to all of their deposited customer funds. I think some if not most is locked up in frozen bank accounts. If that's the case, Mt. Gox is denying it. Here are their statements: - June 20, 2013: "Over the past weeks Mt. Gox has experienced rising volumes of deposits and withdrawals from established and upcoming markets interested in Bitcoin. This increased volume has made it difficult for our bank to process the transactions smoothly and within a timely manner, which has created unnecessary delays for our global customers."
- July 4, 2013: "Mt. Gox is happy to announce that global account withdrawals have now fully resumed as of today".
Mt. Gox's statements blame the bank in Japan they were using for outgoing transfers, and they currently claim there is no problem. Clearly, that is not the case.
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I'm going to transfer around 10k usd to get some bitcoins for buying thr miners and just want to know if there are issues with this exchange Yes, there are issues. not being able to transfer money out to your local bank after selling bitcoins etc
No one has been able to get money out of Mt. Gox in US dollars for the last month. Read the other threads in "Service discussion" about Mt. Gox and their problems.
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It's more or less random from the same IP address in California. Sometimes it works, sometimes there's a 503 error.
I suspect they have a load balancer, and one of the servers behind it has failed at the web server level, but the load balancer is still sending some traffic to it. Most competently managed sites notice that in under two minutes. Mt. Gox...
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Has anyone made a serious attempt to collect from Mt. Gox? There are ways to do this. I don't have any money with them, but I've had to do international collections before, for amounts in high six figures, and I got paid. Here are some options: - Sue in Delaware. Mt. Gox has a legal presence in the U.S., in Delaware, as a result of their FinCen filing. So Mt. Gox can be sued there. Delaware has Justice of the Peace courts with jurisdiction up to $15,000. They even have online filing, although you may have to go to Delaware for the trial. Mt. Gox will either have to send someone to trial, or lose by default. You still have to collect on the judgement, but there are ways to do that.
- Hire a collection agency in Japan. This isn't easy across the language barrier, but it's possible. Search with Google for 債権回収サービス ("Debt collection service"). It's useful to use Google Chrome with automatic translation enabled for this. Find a service that mentions that they do commercial collections, not just consumer collections. Here's the Japan Ministry of Justice's list of registered debt collection agencies.. There are ones that are not registered, but some are just Yazuka goons. (Although that might work, this is going to be a high-profile collection, and they don't want the visibility.) There are U.S. companies which claim they can collect in Japan, but most don't actually have a presence in Japan. Unless a US company has a Tokyo office of their own, they're probably wasting your time. The normal deal is that the collection agency gets a cut of what they collect, but you don't pay anything up front.
- Raise hell in the financial press. Start calling reporters who have written stories about Bitcoin. Call Forbes, the Wall Street Journal, and Bloomberg BusinessWeek. Not just email - call them. Use words like "default" when talking to them.
- File a complaint with the Japan Ministry of Finance under the Payment Services Act. Whether Mt. Gox likes it or not, they fall under the Payment Services Act in Japan, which regulates non-bank money transfer services. Japan has many such services; most of the cell phone companies offer money transfer, for example. They're required to maintain 100% of customer funds in a separate account, and the Financial Services Agency can audit this. The place to start is a Japanese consulate in the US or the Japan External Trade Organization. One of the major functions of consulates, especially ones of countries with big export trade, is to tell people how to deal with cross-border commercial problems.
If Mt. Gox owes you a substantial amount of money, you can make them pay. You don't have to put up with their nonsense. They do not get to determine when and whether they pay up. It doesn't work that way in the real world.
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While it was good to see someone getting funds, that transfer request was really on the cusp of when shit hit the fan. It would be nice to see someone who had a transfer go through that was initiated well after the freeze.
True. One that was submitted early on the day of the "freeze" might have slipped through. It seems clear enough that, although withdrawals supposedly "resumed" on July 4th and Mt. Gox claimed they would be caught up in two weeks, that didn't happen. It has now been one month since Mt. Gox stopped processing withdrawals.
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In reality it is often hard to distinguish between a full Ponzi or just incompetence. Maybe they just made some honest mistakes - then wanted to cover them and got even deeper into it and now don't know how to get out.
That's very likely. Brokers speculating with customer funds have destroyed major financial firms many times. Drexel Burnham Lambert, Lehman Brothers, and recently, MF Global, all went bust for that reason.
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At least you can trade in volumes on MtGox. Not really. You can have the illusion that you're trading. If you don't get paid, you didn't really trade.
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So a USD is worth less on Gox than on Stamp, implying they may not cash you out? At this time, the difference is so large we're not talking future value of money, but a scare of never being able to fully withdraw?
Exactly. And the spread between Mt. Gox and the other exchanges is growing. Last week it was around 5%. Now it's around 10%. This is going to create a Bitcoin price distortion as more suckers become aware that Mt. Gox has defaulted. Mt. Gox prices may continue to rise. But they're not real prices at which you can sell Bitcoins, because you can't get the money out. Bitcoin to USD prices are only real on exchanges where you get paid when you sell.
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Someone needs to sue Mt. Gox. Now. Since they have a registered agent in Delaware, they can be sued in Delaware. Small claims up to $15,000 can be brought in the Justice of the Peace court there. There's even an interactive form for this. You'll have to go to Delaware at least once. Mt. Gox has to send someone to represent them, or they lose by default and you get a judgement against them. You can enforce that judgement, even across national boundaries. There are international collection agencies. They take a cut of what they recover, and don't charge you anything up front. (Pay attention, suckers. You don't have to put up with this shit. You really can take steps which will eventually either get you paid or Mt. Gox out of business.)
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I'm sick & tired of this nonsense around Gox. It's clear that the company is in trouble and people are delusional about the future of this exchange. So, I'm posting a bounty for the person that can show a USD withdrawal requested AFTER 7/4/2013 and that is subsequently put into their account. You will need to post two screen shots, one of the Gox withdrawal and one of it actually in your bank account (the incoming wire). Be the first to post those and you get a 0.25 BTC bounty.
Thank you. It's striking that nobody has posted such a transaction. It seemed clear that Mt. Gox was stalling and delaying withdrawals. But I'd assumed they were still processing at least some of them. If zero withdrawals are coming out, the end of Mt. Gox is very near.
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