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241  Economy / Speculation / Re: commission free trading on bitstamp till Jan 17th on: January 10, 2015, 08:16:24 PM
I noticed that as well. Thinking I might move some coins over there for some quick trading if there are no fees Smiley
Don't keep them there. They're still 18 thousand Bitcoins short. Until Bitstamp has an audit, keep only minimal funds there.
242  Bitcoin / Bitcoin Discussion / Re: The real problem with Exchanges/Services...it's quite simple. on: January 10, 2015, 08:22:40 AM
The main reason Bitcoin was invented was to solve the issue of blind trust.  The funny thing is you can actually trust Bitcoin, it actually works.  Just most things built on top of it are still failing the blind trust problem.  I am wondering if maybe someday the blockchain advancements will solve this. 

Supposedly this is one of the great leaps of smart contracts, is that now, you can force third-parties to trust you via smart contracts. 
That's an excellent point. There are theoretical solutions, involving online contracts, M out of N schemes, and such. Some are even up and running. But none of them are being used much.

Etherium, Ripple, and Paycoin (XPY) were all complex systems built on top of Bitcoin. Etherium is a really complicated "smart contracts" scheme, complicated enough that there are probably exploits. Ripple was supposed to do all sorts of things, but mostly ended up as another altcoin. Paycoin seems to have been an out and out scam. None are being used much.

Bitcoin does one thing well - unidirectional, irrevocable transfers between parties who don't know each other. All its strengths and weaknesses stem from that.
243  Economy / Service Discussion / Re: BITSTAMPS BACK! on: January 10, 2015, 05:08:29 AM
Not a big deal, they have so many coins sitting in the cold storage collecting dust. Their reserve ratio is much higher than any banks in the world, which typically have only 20% of customer funds at hand while still serve the customer for decades
Banks do not work that way. Banks make loans, which are assets to a bank. If you own a loan, you can sell it, which banks do. Loans plus cash plus capital must exceed deposits. Trouble can appear if a broad class of loans lose value, which is what happened in 2008.

Bitcoin exchanges have no secured loans as assets. They are not banks. They are not lending institutions. They have to have 100% of their deposits or they are insolvent.
244  Economy / Service Discussion / Re: BITSTAMPS BACK! on: January 10, 2015, 05:03:01 AM
I highly doubt they have the finances to buy it outright. I think they will have a plan where they slowly pays back the customers over time, or offers them a stake.
That seldom works.  Many financial firms have tried that. Enron was a notable example of that going very wrong.

So, withdraw your funds from Bitstamp for a few months. If they're solvent, it won't hurt them a bit. If not...
245  Economy / Speculation / Re: Bitstamp most likely will buy back the bitcoins they lost on: January 09, 2015, 10:12:15 PM
The thing is, Stamp has to say it will reopen shortly, whatever the situation. If they have actually lost far more and will go bust, they still need to say they will reopen. If they are actually squirreling money off to Brazil, they still need to say they will reopen. If everything is fine and they are about to reopen, they still need to say they will reopen. There is no situation where they would say otherwise.
Right.

The same reasoning applies after they reopened. We don't know if they have enough capital of their own to cover the $5M loss.
246  Economy / Service Discussion / Re: BITSTAMPS BACK! on: January 09, 2015, 09:57:43 PM
The next question is whether Bitstamp is now insolvent.  They lost $5 million.  Did they get new funding to replace that, did they have enough capital of their own, or are they dipping into customer funds?  Their statements have carefully avoided mentioning this issue.

If a real stockbroker lost funds like that, and became insolvent (debts > assets), they would have to stop operations immediately.  In some jurisdictions it is a felony for a broker to continue to accept funds once insolvent.  They don't get to "fix it later". That's because, historically, the temptation to fix it by speculating with customer funds has been a big problem.

With withdrawals working again, it's probably a good idea to get your assets out of Bitstamp. Don't use them as a wallet. Trade there if you like, but empty out your account when not actively trading.

Bitstamp now needs a full audit by an outside auditing firm.
247  Economy / Service Discussion / Re: BITSTAMPS BACK! on: January 09, 2015, 09:27:13 PM
Yes, they're back up, and after 20 minutes there's been enough volume to get them back in sync with the other markets, around $288. Bitcoinwisdom is tracking Bitstamp, but Bitcoin Charts (which is owned by Karpeles) is not.
248  Economy / Service Discussion / Re: BITSTAMPS BACK! on: January 09, 2015, 08:17:08 PM
What about withdrawals? That's the real question. Has anyone had a successful withdrawal yet? Has anyone had an unsuccessful withdrawal?
249  Economy / Service Discussion / Re: Bitstamp will easily recover from this hack on: January 09, 2015, 07:39:59 PM
The site claims to be coming back up. Current message:

"Bitstamp is open for business!
Thank you for your patience during our temporary disruption of services. We are very happy to officially be back up to serve you. Trading will resume at 21:00 UTC January 9th.
Click here for a message from our CEO."

Login is again available.  Someone please try a withdrawal and see if that works. Thanks.
250  Economy / Exchanges / Re: Bitstamp issues statement and temporarily suspends service on: January 09, 2015, 03:21:18 AM
This is conjecture on my part, based on Bitstamp's Twitter statements, such as "Working alongside the team from San Francisco, progress towards redeployment is strong. Huge thank you to for your confidence and patience."

Bitstamp desperately needs a few million dollars right now. Where are they going to get it? They're two unknown guys in their twenties, in Slovenia, with a mail drop in London. Nobody is going to fund that. If they were in Silicon Valley, they might be able to get VC funding. They have a user base; they're fundable. That's probably the motivation for the move to San Francisco.

Whether they can get funding remains unknown. If they'd closed a deal, they would probably announce it. So it's unlikely there's a deal in place.
251  Economy / Service Discussion / Will BitStamp come back? on: January 08, 2015, 11:11:32 PM
Well, there are the possible outcomes. What do you think?
252  Economy / Speculation / Re: So, why did Bitstamp suspend fiat withdrawals? on: January 08, 2015, 09:58:28 PM
Is there a way to find out if someone has already made a statutory demand?
Not unless you sent it. A statutory demand is just a letter delivered by a process server, not a court filing.
253  Other / Archival / Re: I am not worried about Bitstamp recovering in the least.. on: January 08, 2015, 08:47:13 PM
Said the same thing at mt gox I f I remember correctly all your coins are secure. 24 hours becomes days days become weeks weeks bec0me bankruptcy.
That's right. They should at least keep updating the twitter. 2 days ago they said it will take 2 days tops. Now there's no new updates and no working exchange. If there are delays there should be apologies and explanations, not silence.

https://twitter.com/nejc_kodric/status/553260340411379714
Yeah, right. Vague excuses about a "new system" to fix things. Sounds like Mt. Gox claiming the "new trading engine" would fix their problems.
254  Economy / Speculation / Re: So, why did Bitstamp suspend fiat withdrawals? on: January 08, 2015, 08:42:53 PM
If you're in the UK, or have an address in the UK, you can file a statutory demand for payment. That starts a 21 day legal clock, and if they haven't paid after 21 days, you can start putting them into liquidation.

See: "Make and serve a statutory demand", published by the British government. The UK has tough collection laws.

Bitstamp's registered address is:

BITSTAMP LIMITED
5 NEW STREET SQUARE
LONDON
UNITED KINGDOM
EC4A 3TW
Company No. 08157033

Act now to avoid being caught in another Mt. Gox like situation.
If it turns out that Bitstamp is OK, they'll send you your funds, and you're done. It won't hurt them if they pay.
Why would I want to do that? If I put them into liquidation I turn my claim on my funds into that of a senior creditor.
At that point I am equal to any bank that has lent them money, and junior to any venture capital fund that may have lent them money on a secured basis.
In effect my money ceases to become my money and becomes general corporate funds to be distributed equally between all senior creditors, after any taxes, duties and secured creditors have been paid out. So I am likely to get significantly less than I will get if I wait for them to reopen and then withdraw my money. If they have not reopened in a week or so then think again -  but right now what you suggest is detrimental.
That's an excellent point. However, a statutory demand doesn't put them into liquidation; it just gives you that option. That, as a creditor, gives you more bargaining power. Also, it helps prevent dissipation of assets as a dying company thrashes around trying to survive.

Since Bitstamp didn't make their self-imposed 48-hour deadline, and hasn't even issued any new public statements or talked to the press, they're probably in deeper trouble than they've admitted. Worst case, management has run off with the assets and disappeared. Some form of legal or police action is needed. Mt. Gox's creditors waited far too long before acting. 
255  Other / Archival / Re: I am not worried about Bitstamp recovering in the least.. on: January 08, 2015, 08:21:48 PM
Said the same thing at mt gox I f I remember correctly all your coins are secure. 24 hours becomes days days become weeks weeks become bankruptcy.
That's right. They should at least keep updating the twitter. 2 days ago they said it will take 2 days tops. Now there's no new updates and no working exchange. If there are delays there should be apologies and explanations, not silence.
Exactly. Their 48 hours are up. Bitstamp is in much deeper trouble than they are admitting.
256  Bitcoin / Bitcoin Discussion / Re: The real problem with Exchanges/Services...it's quite simple. on: January 08, 2015, 08:09:29 AM
Do you think a company such as Apple or Samsung could just get away with being ran by anonymous CEO's that simply go by an internet screenname?
The public internet didn't exist when Apple was founded, but other than that, let's think about your question. When Apple built and sold its first personal computer, nobody knew who Steve Wozniak was and by all accounts I've heard Steve Jobs was some college kid who used a lot of LSD and made his money building and selling devices to defraud the phone company. They didn't start out as a multi-billion dollar international corporation with a huge corporate headquarters. They were two almost completely anonymous guys in a garage. If the public internet were around and as popular as it is today, Apple's achievement obviously wouldn't have been as big a deal as it was, but I wouldn't be too surprised if Woz and Jobs ended up announcing their new product on some online forum, where they may or may not be using their real names.
They announced the Apple I in person, at a meeting of the Homebrew Computer Club, and they had a demo unit. They sold them through the Byte Shop in Santa Clara, California. The history of Apple is well known, and the founders were never anonymous.
Quote
I don't know much about Samsung's backstory, but I'd be willing to bet almost any amount of money that they also didn't start out as a multi-billion dollar international corporation with a huge corporate headquarters.
Samsung started as a grocery and noodle company owned by an old, well-known land-owning family. Then they were a woolen and trading company. By the time they got into high-tech, in the 1960s, they were already a big company.
Quote
The world just doesn't work like that, and Bitcoin doesn't change that fact. Most likely it was a couple guys in a garage or a university dorm room (same can be said for Microsoft, Facebook, Google, Dell).
Microsoft did start small, but Gates had been going to Harvard and his family was rich. Same for Facebook and Zuckerberg.  Page and Brin were both at Stanford, and both were the sons of college professors.
257  Bitcoin / Bitcoin Discussion / Re: Is there any demand for a Bitcoin auditing service? on: January 08, 2015, 07:56:46 AM
It's more likely that a real auditing firm would get some Bitcoin expertise if they needed to audit a Bitcoin-oriented firm. Auditing firms audit all kinds of hard-to-audit companies. Bitcoin companies aren't that hard to audit - so far, they're basically cash businesses. Asset valuation isn't a big problem.

The problem is that suckers Bitcoin users have been putting their trust in  un-audited companies. Is Bitstamp broke? We don't know.
258  Economy / Service Discussion / Re: Bitstamp will easily recover from this hack on: January 08, 2015, 07:26:40 AM
Why did Stamp shut down all fiat withdrawals, if this was just a "bitcoin hack"?  Cheesy  Roll Eyes
That is what I would like an answer to. There should be no directly linked reason to the btc hack that involves USD/fiat wires being halted.
Another big red flag.
That's the big question. It's very suspicious that Bitstamp is evading answering it.

It's also a concern that Bitstamp's replies, on Twitter and on their own site, are increasingly vague about when they will be back up.

If they try to bring trading back up while limiting withdrawals, assume they're crooks.
259  Economy / Service Discussion / Re: BitStamp - hacked and down on: January 08, 2015, 04:53:08 AM
I initiated a Withdrawal via bank 04/01/2015.  They claim to have trouble with their Bitcoin systems, but that does not excuse them from sending my bank wire.  Cool story about your exchange Bitstamp, but you can still process my wire.
That's an even bigger red flag. That's a strong indication of them not having funds.
260  Economy / Speculation / Re: 300 is broken, to never see again on: January 08, 2015, 04:51:15 AM
Where are we headed from here?
Probably sideways until it becomes clear if Bitstamp is going bust.
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