Fantastic project! I've made a donation to recycles.org.

Also, you should put up copies of the letters you've sent out, make it public.

There's obviously a lot of detail here. I've read some of it but I'm still trying to understand it. The FAQ is missing some obvious high-level questions for newcomers :
 - How do I transfer my real USD for digital USD? Send it to an issuer? How do I trust the issuer?
 - If a issuer's assets are stolen, or the issuer is bad actor, the reserves will less than stated, or zero. Presumably everyone who owns digital versions of those assets will see their value wiped out. In effect, owners of a digital USD currency take counterparty risk to the USD issuer that they use?
 - If a Bad Event happens (eg. MtGoxIssuer is compromised), is there a way to alter the transaction chain similar to "a 51% of Bitcoin Miners" vote?

Assuming I understand this so far :
 - Would you intend to counteract the requirement to an issuer by diversification? ie. Have 1000 digital USD issuers, and trade a basket of those issued currencies?
 - If I set myself up as a USD issuer, my reliability would be low. It seem logical that my Isosceles USD would be worth less than 1 USD issued by MegaBank Issuer, right? So I wouldn't bother, I'd just send my funds to MegaBank. This reduces the pool for diversification. What incentive is there to be a large number of digital USD issuers?
 - CDOs are extremely complicated things, not suitable for retail investors. Why do you have them on your To Do list?

If you want to be taken seriously, write it up as a technical paper & post it.

TradeHill - Given the same issue as MtGox (a compromised large account), how would you deal with it and protect the marketplace?

https://support.mtgox.com/entries/20208066-huge-bitcoin-sell-off-due-to-a-compromised-account-rollback

Huge Bitcoin sell off due to a compromised account - rollback

Mark Karpeles
posted this on Jun-20 04:07
The bitcoin will be back to around 17.5$/BTC after we rollback all trades that have happened after the huge Bitcoin sale that happened on June 20th near 3:00am (JST).

Service should be back by June 20th 10:00am (JST, 01:00am GMT) with all the trades reversed and accounts available.

One account with a lot of coins was compromised and whoever stole it (using a HK based IP to login) first sold all the coins in there, to buy those again just after, and then tried to withdraw the coins. The $1000/day withdraw limit was active for this account and the hacker could only get out with $1000 worth of coins.

Apart from this no account was compromised, and nothing was lost. Due to the large impact this had on the Bitcoin market, we will rollback every trade which happened since the big sale, and ensure this account is secure before opening access again.

0 People found this helpful - Me too!

Graphed :

Someone uploaded it to pastebin. Answer here : http://forum.bitcoin.org/index.php?topic=19505.msg244493#msg244493

Answer :
Below $10 : 150k BTC, $243k USD
Below $5 : 132k BTC, $115k USD

Here's the full list of bids hit :
http://pastebin.com/J0HXBjWu

And in graph form :

Hazek, do you have a screenshot of the rest of the trades?

Putting the numbers from your screenshot in to Excel, there was only $5.3k traded, of which $2.7k was >$10, and the remaining was the stub order

But what volume in $ traded below $10? Someone hitting a stupidly low bid is just stupidity. They lost 200k BTC, and gained $2k USD.

Why would anyone deliberately cash out at $0.01? Someone's stub quote just made them a BTC fortune. This is the Bitcoin Flash Crash.

Before you panic & sell everything, just because there's no bids for 5 minutes doesn't mean the market will stay broken. Unless there's a surplus of fools willing to part with their bitcoins for <$10.

Does anyone know what volume of BTC was actually sold for <$10 or <$5?

Bitcoiners' do it without an external stimulus

I'm supporting the StackExchange site. There needs to be a well-organised place for Q&A, for old & new users. StackExchange would be ideal.

@bcearl : I'm installing Ubuntu on a USB drive at the moment, but I'm a relative linux newb. Do you have instructions for securing it for Bitcoin? ie. removing unnecessary apps, removing swap drive, setting up the firewall, etc.
Also, I read BSD has only had 2 security vulnerabilities in it's whole life. If that's true, it sounds secure, so why choose Ubuntu?

For all others following this path, here's the link to PenDrive Linux - a 1-step USB install of any linux distro
http://www.pendrivelinux.com/universal-usb-installer-easy-as-1-2-3/

Software Keylogger? Hardware keylogger?
Vulnerability in the Ubuntu encryption algorithm? From what I read, Truecrypt is supposedly the gold-standard. Can you configure Ubuntu to use it for the home dir?
Vulnerability in Ubuntu? If you update your OS, can your download be redirected to another location with a compromised OS patch?

For those who use an "air gapped" machine, how do you spend the coins? Is it possible to manually enter a Bitcoin transaction by paper, pen & a networked PC?

@theymos : That's good info. But how many of those are recent blocks, ie. > Jan-2011?

No they shouldn't close at the weekend. Does Google close on Saturdays? This is the new world.
Besides, even if MtGox closed there would be others who stayed open, which would increase volatility.

From what I can see, Bitcoin exchanges have 5 fundamental groups of investors. In order of trade volume :
 - New Money looking for BTC exposure (speculation)
 - Old Money (miners) looking to get out at a good price
 - New BTC miners looking sell to hedge their hardware costs
 - Merchants selling their BTC to cover real world costs
 - New Money looking for BTC to buy merchants' products

One factor which concerns me is the number of old-time miners with large bitcoin holdings. Approx 7.2mm bitcoin had been mined by the start of 2011 [1], and the total trade volume on MtGox since then has been very approximately 1mm BTC (20mm USD / $20) [2]. If the old-time miners all got out at the same time (eg. fear due to the price crashing 75%), there would be a rout.

Thoughts? Anyone have trade volume estimates on the other groups?

References :
  1)  https://en.bitcoin.it/w/images/en/e/e3/Total_bitcoins_over_time_graph.png
  2)  https://i.imgur.com/HHlnd.png

There are some well-educated users which post insightful comments on these forums. I need a way to follow them so I can read what they say in future, without reading through the trolls.

Thanks! My bitcoins feel more secure already