Hiya,

As things start to heat up (cool!) - it's clear you require help testing - i'd like to be involved. Is there any clear plan or list of tasks that one should accomplish?

Thanks for all the hard work.

Selling 30 @ 0.3BTC each

Maxmint escrow

PM or see orderbook on mcoin.io

please add: 30MSC for 0.3 per coin (total 9)

Botnet mining is absolutely going to be a problem. As many have pointed out already, a large botnet could take 50% of market share almost overnight. Imagine a botnet of 1 million PC's (quite common), the cpu's running at half intensity would absolutely destroy profitability for "honest" miners. Now lets imagine that 10% of these computers have descent GPU's or that just 1% have some of the top of the line ATI GPU's. You can now see the problem. BTW The idea that botnet operators would have to choose between running, say a spam network and a bitcoin mining operation is false, what is to stop them doing both? The incentive's for these guys are enormous. Bitcoin mining over the botnet paradigm provides a direct route to quick cash.

There are however, some technical problems for the botnet operators to overcome, e.g. collecting the mined coins, preventing user detection.... but i can't see anything that won't be solved by clever code. Can we as a community come up with some method to prevent this from happening? Almost certainly not unless we can find a way to force some kind of user interaction into the mining process. I can't imagine how? Would we could at least do is ask the pools to come up with some security measures to prevent obvious use of botnets in their systems, but that would be require an incentive to do so, whilst yet right now they will be earning lot's of fee's by ignoring the problem.

Will bitcoin become associated with hackers looking for cheap bucks? I think so. Maybe we can persuade the big exchanges, the community and the pools to watch out for botnet behaviour (it should be fairly obvious) and thus attempt to make it difficult for these guys to cash out easily. Perhaps in the end the backbone of the bitcoin mining network will be controlled by botnet's, it may be an inevitability we have to accept.

gogogogogo

It's OK to enter twice right?

only entered 20 minutes ago and i am a winn0r,

thanks

It's funny becasue one day soon enough we won't need the hassle of dwolla and will find more direct routes.

They are only useful for the short-medium term.

I posted this in IRC last night and had some good convo with MagicalTux and various others. Currently i'm at work so don't have the logs in front of me. Please have a look and tell me if you see some error in my analysis or basic understanding! This is not an accusation of any kind, just someone trying to get to the bottom of this thing.

After the claims by MT that Kevin's behaviour was 'suspicous' i started looking at the activity logs on the market when it crashed, specifically what happened right at the turn (i.e. the rise back up from 0.01 after the sell).

MT said many, many things, some in his post and some in IRC chat.

So according to MT:

1) Kevin logged in at 5:12, just a few minutes before the market started crashing (~5:15 onwards).
2) Since he bought at 0.01 he must have placed that large bid BEFORE the market crashed...thus implicating him (after all who would place a ~$3000 bid at 0.01 unless they knew it was comming).

According to MT this makes Kevin looks suspcious. But there is more useful info to consider:

4) When a BUY order is filled, the only log recorded is the time of the FILL and the time the order was PLACED gets wiped out completely. Thus Tux cannot be sure of anything really.
3) Also important to mention from MT we know that you cannot place a buy when a sell is in progress. So Kevin had to have placed that order before or after the sell, but could not have done so during.

Now check:

http://www.youtube.com/watch?v=T1X6qQt9ONg

This is a video of the market crashing live, it shows a ticker. The part we are interested in is at ~5.23 into the vid, right at the turn.

What we see are three things.

1) Orders being filled with a timecode of 13:15:xx

I guess this is the time that the mega sell order was created. Here we are seeing the order book being processed and then finally getting wiped out, 0.01 and then being emptied. This take a long time.

2) Then notice time change. Ticker goes from 13:15:xx to 13:51:xx instantly. More than 30 minute gap!

This is when NEW buy orders start arriving, /after the sell has wiped out the book/

3) The 6th order down from the time change is *the big one* 13:51:16  0.01  261383.76

4) From there the orders start increasing in value, until the market bounces right back to $14 or so fairly sharply/


So some important questions and conclusions really. Looks very plain to me from these logs that Kevin did indeed get very lucky. He watched the market crash, prepared his bid and hit go just at the right time -> managing to get the 6th BUY order after the turn, not the first, the 6th.

>>>>>> Kevin placed the BUY order after the SELL and the crash, not before as he was accused of.

The login time does not proove anything, what is important is the time of the buy order was placed. But we cannot get this from MTGox because of the log issue i've mentioned so we must relly on our own understanding.



If we assume as i now do, that Kevin's really is innocent, then what was the motivation of the Hacker? We all assumed the hacker was trying to crash the markets so he could cash out, but this clearly didn't work if kevin is innocent!!!!

a) placing a large buy just after the crash ....

... the problem with a is that how would anyone be sure he could get the order in at the right time. We all know that mgtox is slow at the best of times and any half descent brain would realise that after a major market event like that, the site was going to be absolutely hammered and thus impossible to reliably connect to - just as many of you here have reported.

So unless Hacker person messed this up badly, or Kevin beat him at his own game, it looks to me like they didn't have any real intention of cashing out like this..


b) placing a large buy before the crash ... (which didn't happen as the market activity ticker seems to show)

A better stratergy would have been to use several other compomised accounts (if guy had DB access, this should have been no problem) to place 0.01 BUY orders before the SELL, just at or under the equivalent $1000 usd limit. They would have been filled and if he had withdrawn the BTC very quickly he may well have gotten away with a much, much, much larger sum.

Why not do that? Was he stupid, a kid or did he just not care about the money that much and doing it for some other purpose.

In any sense Kevin does not look like a guilty party to me but a very lucky guy who now seems to think he should be entitled to keep the profits of a crime. I wonder what his mother would say.


MagicalTux: I appreciate how busy you are trying to bring MTGox back. However, a full, indepdent analysis of these events and the others mentioned in this thread, is the only realistic way to address the concerns of your user base. Diverting attention by blaming others with very sketchy.->zero evidence is absolutely not cool.

Depends entirely on how many people attempt to reclaim their password quickly and how much needs to be done manually. Realistically IMO we are looking at the end of the week.

Sorry i wasn't very clear in the moment. My point was that mtgox really shouldn't let this happen. It's not profesional at all:

explanations for what we just saw??

a) someone getting out and not giving a crap

b) huge accident on some sellers part

c) mtgox f'd up??

interested to know if could be something else

someone who doesn't give a damn got hold of a large number of coins??

Markets should not let this happen. Bitcoin looks like a joke

$1.20!!!!

$5

!!

trouble

I think OP has a good point actually.

The numbers are so enormous that using 100,000+ cpu's would have massive impact on difficulty, forcing mining costs up. Then there is the small percentage of zombie machines that will have a descent graphics card or two that can be put to use. Mining clients are well suited to the botnet paradigm and can be easily integrated.

I guess the question will be whether botnet owners want to do something quite so brazen.

 

Haven't there already been two anyway??

http://www.economist.com/blogs/babbage/2011/06/virtual-currency?fsrc=scn/fb/wl/bl/bitsandbob

-quite nice, online

http://www.economist.com/node/18836780?story_id=18836780

-less so, print edition

I've worked with arduino. All of this is very doable and i'd loe to be involved!

Linux idea is great if your a geek but a small, simple and intuitive way of storing coins securely will really help the mainstream feel comfortable.

 

How can they? It would have to be pretty creative 'cause you can't really bring down the network.

Perhaps if they invested in huge amounts of computing power to get over 50% of the hashing they could case some problems, but since our hasing power is something like 40x the worlds biggest supercomputer they would really have to sped big time. They could try to crash the market with a big influx and outflux of cash and i guess there is a chance that could happen but I think in either case it would become quite apparent very quickly and we would have a good chance of stopping it.

One route they might go down is to prevent trading by shutting sites like MTGox. We need to decentralise our trading urgently. If MtGox went down it would cause pandemonium.

In the end if we keep going for a just a little while longer i think the bitcoin userbase will be so big and so diverse that one government acting alone would stand very little chance.

I think it is hard to imagine a scenario where demand outstrips difficulty for any really significant period of time. We might have bubbles of media/public created inflation but... Commercial and public interest will quickly lead to solutions for mining these coins, ASIC, FPGA etc not too long afterwards. The players involved will eventually find an equilibrium to balance it out.

There is a good, old analogy with gold mining in america. The gold rush made a few lucky, early miners rich. The company that sold them all the shovels got absolutely loaded pretty damn quick.


But now here we are back to demand. Gold is tangible, shiny, rare. It's quite easy to understand why people valued trading in it, it was quite obvious to the average joe why having lots of gold was a good aim. Can we do the same on the internet with BitCoins?

Part of the problem is the technological barrier. How many here really understand the way BitCoin operates, i mean, really get it. Not many i imagine and i don't see that may people (my friends included)  become immediately interested when i start talking about private and public key cryptography.

 So my main concern is that bitcoins has thus far been a highly niche interest that attracts a good percentage of the geek and liberal population without really grabbing an equal share of the general public or business interest. Essentially we have too much difficulty and too much coming every day.

If we can break through that barrier, by simplifying and enhancing security AND solving liquidity (amongst others) issues maybe we will see the growth spurt we all want.

Who's going to show you there is a goat behind a door?