I think Bitfloor already was registered.

This OP makes me think that Bitcoin will be a MAJOR push towards something like seasteading, or a private island nation, simply because those who became bitcoin-wealthy will likely want to come together to support each other; strengths in numbers and safety in sticking together kinda thing. In the end, we may just end up with a super-wealthy micronation that likely works as a non-binding corporation/conglomerate of wealthy owners, residing within the safety of their own privately militarized, protected gated community/island/ship, with its tentacles in every business in the rest of the world.

The nice thing about markets and economics is that people will always need "stuff," and as long as people need "stuff" and other people are willing to make "stuff" for money, there will always be work and "stuff" being made, regardless of who holds all the wealth.

If they ban pressure cookers, criminals will just use water heaters. Anyone see MythBusters launch one of those suckers hundreds of meters into the air?

Considering the whole business model of ING Direct was based on "we can close your account for any reason, even if we just don't like you," I'm going to have to say [citation needed]


Then please, good sir, redeem yourself by explaining where you got the idea that anyone here was suggesting that Bitfloor's account is being closed as part of an attack on Bitcoin itself?

Huh, weird. Didn't think USA had any issues with Chechnya.

Adam

I like the "use exchanges as just escrows" idea, but if the trades on a P2P exchange ramp up considerably, won't the escrow holders be holding massive amounts of fiat, and thus still be at risk for Cyprus style issues? Not saying it's not a good idea, just not sure that such an issue can at all be avoided, short of forgoing escrows completely.

No, no you can't. You can speculate and make up baseless accusations.


See?


25,000 BTC, not $2mil. Even if you convert it to USD, it's $250,000 that went missing.


Total lie. The company answered questions, talked to people on the forums and came to the best course of action that it could get, that being, to repay the customers from it's future profits. Some customers complained, but either it's get repaid slowly, or the business goes away. No one was willing to invest enough in the LLC, or to give it a big enough loan, to cover the loss. And don't forget, it's an LLC. Roman isn't personally liable to anyone.


Despite Bitfloor being registered and following AML procedures? Or is this more "speculating?"


No, just speculation. Baseless fud more like it. See above.


Please explain MtGox and their French bank account then? How can you say that it's a pain in the ass to operate in the real world, and then turn around and say that "Banks don't close people's accounts without explanations" and that "it must be all Bitfloor's fault?" Are you operating in the real world, and finding it to be a pain in the ass, because you are so incompetent, too?

NOBODY is suggesting that, and, frankly, you're an idiot for even thinking that anyone has. What we are saying is that banks have an uncanny tendency to shut down accounts of any businesses they deem "inconvenient." Bitfloor and MtGox trade currency, meaning their bank accounts get a lot of deposits and withdrawals. The bank could have closed the account because it was worried about money laundering issues (not from Bitfloor, but from the government auditing them), or they could even have closed the account because the accounting work to track all the money coming in and out was simply getting too tedious. Maybe the exchanges were just costing them too much in accountant salaries and overtime. It doesn't matter. Banks can close accounts on businesses without explanation or recourse, and you can't blame that on Bitfloor.


Well, you can, but then you shouldn't be involved with Bitcoin anyway, since the whole damn point of Bitcoin is to make this kind of bullshit go away. If you think that this kind of bs is the fault of the people using the banks, and not the banks themselves, you're in the wrong forum.

Funny you should ask, because in the real world ^(tm) I would expect to get the money back, but what actually happens most of the time is they just say "they'll get back" to me.

This is one of those not actual "criticisms" I was talking about. Why do you believe they did not understand their business?



Not true. They had enough BTC and enough USD to cover all withdrawals, since they did not do any fractional reserve. What extra capital did they need?


That's the one thing I mentioned that was, at the very least, weird.


They did. They were registered with the government, they had a business bank account. The bank decided not to like them. It's a fairly common occurrence with bitcoin-based businesses. Even happened to MtGox, where the bank they worked with knew what they were doing, was ok with it, then decided they're not ok with it, and MtGox actually had to take them to court.


I was not aware they had customer support and staffing problems. Is this something you are bringing up just now? Why? and what does this have to do with their current situation?


What does this have to do with what happened now? Repay the money how, and from what source? And what do you think they were doing when they were using their own profits to make people whole? Would a competent thing have been to print 25,000BTC out of nothing and work under severe fractional reserve? Or would the more competent thing have been to say "We were robbed, oh well, good luck, I'm shutting down, and leaving you with nothing"? What is the competent thing to do?

I don't like to be frozen 7 months of the year :/

There are "criticisms," and there are outright "lies and misinformation." It's not wrong to defend someone against "outright lies and misinformation," even if that someone really screwed up. Feel free to criticize Bitfloor for not having a contingency plan for something like this, or sending the e-mail to some people but not others, but don't criticize them for something beyond their control.

So, I'm not a gun nut, and have no real interest in guns, BUT I am a James Bond nut, and since I can afford it, I figured, hey, why don't I buy a Walther PPK just for the hell of it! Then I can dress up in fancy suits and pretend I'm James Bond, too!

Then I looked at my state's gun laws, and turns out that in Maryland, you are allowed to buy a gun, you are allowed to store it in your home, but you are not allowed to have it outside of your house. At all. Not on your person, not in your car, not in a box or a safe being transported somewhere, just nowhere at all. So, yay that I can get a collector piece (I'm at least allowed to drive it from the store to my house), but seriously, wtf?  

Honestly, your best option is to e-mail Bitfloor support, and ask what they can do for you regarding getting your money out. They are no doubt inundated with e-mails, and thus may not get to you quickly, but if you are international, they may wire the money, or send it to you by other means. Regardless, the best action is to actually talk to them, directly, instead of complain to all of us, who really can't help you in any way.

Good luck.

Everyone should be limited to chamber pots. Sales of pressure cookers should just require background checks and registration. If all pressure cookers required registration and were marked with a serial number, the culprit would have been caught already... Wait...

That doesn't answer my question of what happens to the IOUs if one of the brokers busts and losses their USD, resulting in more IOUs than USD in the system. Will the central minter reduce the value of each outstanding IOU to adjust for the reduced value of the backing? Will it track who owns which IOU and delete the IOUs that were bought from that specific broker? Will it punish those who did a lot of research on a broker to make sure they are trustworthy, by forcing them to cover the losses of those who didn't do their work and bought IOUs from a sketchy broker? Is USD stored at one broker really worth the same (including risk/security as USD stored at another broker?

As a business start-up manager myself, could you please explain to me how having your bank account closed on you is a form of incompetence? I'd like to learn so that I can avoid the same problem with my business.

Would an IOU issued by one exchange be honored by another? For example, if CampBX issues an IOU backed by the USD in their accounts, and is raided, shut down, and the USD is seized, why would, say, MtGox still honor those IOUs, if they don't have the USD to back them, and were not at fault for CampBX getting seized?
If the answer is no, i.e. that each IOU is only honored by the exchange that issued it, then there's no need to decentralize that aspect. The exchange that issued the IOU can keep track of which trading account holds which IOUs, and when a trade happens, both parties to the trade can sign a statement that the trade happened, using their own trading account signatures, to prove to the IOU issuer that now the IOU belongs to a new person. The issuer just has to update their books. At the end of the day, issuers can exchange IOUs with other issuers while transferring the backing cash to them.

You launch your client, it connects to all the peers, and downloads all the available open trades. Maybe even have the system hold onto trades that are currently ongoing, and ones that closed only a few hours ago (E.g. both P2Pool and Bitmessage hold onto historical data up to the last 2 days before pruning it). That should be enough to see what the spot price is and make a trade. Some other services could pop up and keep a log of all the trade history, along with graphs and such, in case you wanted to look it up. Having everyone download gigs of data just to participate and see the trade history is a bit of a waste I think.


And that's actually the most difficult part of this entire idea; not the trading or keeping the order book. Two ideas so far are brokers issuing their own currency tokens redeemable 1:1 for a USD, the other is using the trading platform to find a trading partner and then settling the trade personally, off the system, sort of like Localbitcoins.com, but online.

Can you please provide some backup to the claim that Bitfloor stole the money themselves, as opposed to Bitfloor having the money stolen from them?