It worse if it's legitimate. It's an appallingly put together document. If that's the level of competence being brought to a crisis then there's no hope for MtGox. |
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Unconfirmed reports on reddit that trading has now been disabled. Still waiting for a screenshot from someone I consider trustworthy.
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The major problem with the continued silence on the part of MtGox is that all rumours are now being regarded as equally valid. Some are probably much closer to the truth than others, but there's no real way to objectively assess their validity so people are reacting as though all of them are true or all of them are bullshit. Very smart thinking. What do you think about the "roundness" of the number? 750K coins, why not 756,915 coins? or maybe it isn't rounded? (I didn't click the link), FWIW, the supposed "leaked document" has now been posted on scribd and includes an alleged statement of assets and liabilities. It's somewhat curious that the BTC amounts given in that statement are not rounded but the USD amounts are (the claim against CoinLab is for 5 million plus some, not an exact 5 million). Here's a link to the document. http://www.scribd.com/doc/209050732/MtGox-Situation-Crisis-Strategy-DraftI remain skeptical about its authenticity for many reasons, not least of all because it reads like something put together by a complete amateur. Unconfirmed reports on reddit that MtGox has now disabled trading. Can anyone else access Charlie Shrem's Twitter? Just went to check whether he's said anything more since the document was put on scribd and his Twitter seems to be gone. |
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Here's a solution: MtGox should come out and state exactly how much bitcoins they have lost (hint, they just need to sum all the bitcoins in the accounts and compare them to how many bitcoins they actually have in their wallet), and promise to repair the losses from their own funds.
The longer MtGox doesn't communicate anything, the more such rumours seem believable.
You're assuming they even know how much they've lost, which might not be the case. Small businesses often have terrible book-keeping practices and can leak funds all over the place without being aware of it. You'd really want any statement about the amount of their losses to be independently verified by financial professionals (preferably forensic accountants). Given how small the MtGox staff is, it would be rather pointless for someone to leak internal documents anonymously. They might as well release the information with their own name attached as the source of the leak would be established quickly and I doubt any of the staff are so well paid that helping MtGox to cover up would benefit them greatly at this point. The major problem with the continued silence on the part of MtGox is that all rumours are now being regarded as equally valid. Some are probably much closer to the truth than others, but there's no real way to objectively assess their validity so people are reacting as though all of them are true or all of them are bullshit. |
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The worry of bankruptcy is one of the main reasons for the massive sell offs on Gox, otherwise people would be hanging onto their BTC. Trying to claim lost BTC in bankruptcy court is almost definitely a lost cause since most governments have not even classified BTC as a real currency.
No, it is not. In a bankruptcy process all known belongings of a company are confiscated, it includes his fapuccino, his Magic The Gathering collection and all the BTC. Then it is used to pay everyone who claim in court to have a credit on a preference order ( taxes and employee credits are always first ). Nobody here is familiar enough with the Japanese insolvency process to comment with any certainty on exactly how it would proceed. The issue of whether Bitcoin claims can be treated differently from fiat claims arose in the Bitcoinica liquidation but to my knowledge hasn't been resolved as the liquidator hasn't been able to take possession of the Bitcoinica funds held on MtGox. We honestly don't know what would be liquidated in a Japanese insolvency. We don't know whether users would be regarded as unsecured creditors. We don't know whether the domain names and trademark would be sold along with all the BTC. We certainly don't know who might have claims superior to those of users. Generally speaking unsecured creditors rarely benefit from bankruptcy proceedings. The benefit of forcing the issue at this stage would be to stop MtGox owing even more people more money if it is indeed insolvent or forcing it to start paying what it owes if it's not. |
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LOL meter maxed out on this one. Crisis Strategy Draft. Right. No author, no date, no document link. Just a bunch of made up BS.
Not to mention that it's not even written in the language which would be used by someone preparing a "Crisis Strategy Draft". It's just not how such documents are written and if it was a genuine MtGox internal document then I'd be more concerned than ever about the competence of those running MtGox. I'd love to have $100 for ever time I've read about something which supposedly came from a MtGox insider over the past couple of weeks. Additionally, the owner of the tumblr says nothing at all which establishes him as someone who would have access to credible information regarding MtGox. |
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It will be a very bad day for BTC if Gox goes under. The negative publicity that it will draw from the MSM will surely discourage new investors and drive the BTC price down. Miner manufacturing companies could take a big hit through cancelled orders/refund requests. So all the members who seem to take a smug position at the thought of Gox going under may like to think how that event may indirectly effect them.
It aint gonna be pretty for anyone.
cheers,
kev
The continued uncertainty regarding MtGox is far worse for Bitcoin than Gox going under would be. |
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it just means we need to be patient while they take twice as much time as the competition and deliver a solution half as good. Wrong answer. We do not "need to be patient." Mt. Gox needs to be killed off in a bankruptcy and their assets distributed to their depositors. You think this will lead to a better outcome than waiting for them to fix their issues and then just removing all your coins and never going back? I suspect a lawsuit will strand people for yearsWhen has the "waiting for them to fix their issues" ever worked out in users' favour with regard to Bitcoin exchanges? Historically, all it's done has given exchanges time to end up owing even more money before they finally collapse. MtGox isn't saying that when withdrawals resume people will be able to take out all their money and never go back. They've explicitly said that they'll be imposing new withdrawal limits and "moderating" the pace of withdrawals - which can only mean that getting funds out of MtGox will be even slower in the future than it has been in the past. It would be different if Gox was saying that anyone who wants out can get out entirely when they resume withdrawals but they're not doing that. They have no plan which doesn't involve holding user funds hostage for an unspecified, indefinite period of time. Users have an inherent right to have their funds returned on request. Gox is not honouring that right. Gox does not have an inherent right to hold user funds hostage while they fix their issues. Those who wish to leave their funds on Gox while Gox fixes their shit should be free to do so but nobody should be compelled to do so - Gox isn't offering people a choice, so it's hardly surprising that people are seeking ways to force them to disgorge user funds. |
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So, let's say you impatient folk sue based on all this hearsay and rumour... and it turns out there was enough BTC after all.
It's been what.. a week or so into a technical issue and you guys want to mire MTGox in lawsuits? Do you know how much value this will eat in legal costs? I think you've got big dumb balls to get involved with this so soon - as MTGox will go you for costs + damages if you're wrong.
It's been half a year since Mt. Gox started dragging their feet on withdrawals. The "two week hiatus" on US dollar withdrawals from July 2013 never ended. Mt. Gox has no counterclaim here. This is debt collection. It doesn't even matter whether Mt. Gox "has the Bitcoins". The only question is whether they're paying their debts, which, clearly, they are not. That's why it's time to put Mt. Gox into involuntary bankruptcy. Not just that. There is every reason to believe based on MtGox's own statements that if withdrawals are resumed they will be even slower than before (and SEPA and Japanese withdrawal times had already blown out prior to this). Users aren't being given the option of exiting the game if that's not acceptable to them. Even if MtGox is nominally solvent, this cycle of ever-increasing withdrawal times needs to be broken. If it's solvent, there is no reason why it cannot return all customer balances while it sorts out its technical issues. Instead, what it's currently promising is that getting funds out of MtGox is going to be even more difficult when withdrawals resume. It's unilaterally imposing new terms and conditions without giving users the ability to opt out of accepting them. That MtGox is not allowing people to withdraw their funds is not "hearsay and rumour". That it had become increasingly difficult for people to withdraw funds from MtGox even prior to withdrawals being suspended by MtGox is also not "hearsay and rumour". That MtGox has stated it will be imposing new withdrawal limits and "moderating" the pace of withdrawals when they resume is not "hearsay and rumour". These are all facts. People have every right to decide the situation in unacceptable to them and to seek recovery of their funds through other means, given that MtGox itself is suggesting that users won't simply be able to take their funds and go elsewhere when withdrawals resume. Continuing to allow deposits and trading while they have unaddressed technical issues is at best unethical on the part of MtGox. Those who have no assurances about when they'll ever be able to withdraw funds from MtGox have every right to take measures to ensure that MtGox is forced to operate transparently and ethically. MtGox has nothing to fear from such action if it is, indeed, solvent. |
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I am open to suggestions on this. Right now where I am is that I don't think it's wise that we sit back and wait. We have an opportunity to show to the world that we can get organised and bring some much needed closure to this issue. I propose we all start putting pressure on Gox to declare the facts. IF Mark has screwed up and feels it is going to be embarrassing for him then someone needs to go in to the offices and talk him down and tell the truth.
Bitcoin Foundation members have tried reaching out to Mark. Some have offered him both money and technical resources. I don't think that he's more likely to listen to users at this point than he is to listen to other business people or to give answers to users that he's not willing to give the media. MtGox has so many users that it's not reasonable to expect they're all going to be in agreement on how to approach this situation. It's the right of users to protect their own best interests and to do so in the manner they see fit. It's the obligation of each user to obtain professional advice about how best to do that. Frankly, the "wait and give them a chance to sort things out" approach has historically not ended well in the world of Bitcoin exchanges. It needs to be acknowledged that such an approach can leave users collectively worse off. Some people are going to be unhappy with the approaches taken by others. That is inevitable. It doesn't, however, mean that those approaches are objectively wrong or should not be taken. I don't believe there are any options which will bring rapid "closure", though. |
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http://www.marketwatch.com/story/regulator-to-sound-alarm-on-bitcoin-2014-02-24?mod=wsj_share_tweetJoseph Borg, state securities administrator in Alabama and a past president of the North American State Securities Administrators Association, says he plans to issue a consumer alert Tuesday, suggesting that if consumers and investors have trouble redeeming bitcoins or cashing out of their accounts, they stop trading—or adding to their holdings on account—until issues are resolved.
Borg has been involved in a wide range of high-profile cases in his 20 years on the Alabama Securities Commission perhaps most notably pushing for the formation of the multi-state task force that ultimately shut down Stratton Oakmont, the investment firm that was the basis for the recent movie “The Wolf of Wall Street.”
That’s particularly bad news for Mt. Gox, the largest bitcoin exchange, as Borg says his move was prompted by seeing a string of correspondence showing the frustrations some Gox customers have had in trying to get their money out.
After exchanging emails or chatting with about 60 crypto-currency traders (some have already moved away from BTC), it’s clear to me that issues related to making withdrawals from one’s accounts are all too common, with some describing the money being held in “Mt. Gox jail.”
Investors describe repeatedly being asked to provide information that any reputable financial company should not have had to request, such as linked bank account numbers, amounts on account with the exchange—both in bitcoins and in dollars—and more. Expedited requests—where customers were willing to pay fees of 5% to have withdrawals processed “manually”—wound up taking weeks and were going unfilled; Borg noted that, in this day and age, any suggestion that “manual processing” is faster is alarming.
Borg says he’ll cite recent reports from a survey from CoinDesk, a leading bitcoin news/information site, showing that nearly two-thirds of Mt. Gox users were still awaiting funds; some had waited as long as three months. He mentioned numerous examples—again, in some cases after looking at emails Mt. Gox users shared with MarketWatch—in saying, “If it was an investment we were talking about, we’d be moving to shut somebody down or to make them step up and take care of business properly.…If it took you a month or two or three to get your money out of a brand-name brokerage firm, you’d be worried that something bad is going on, and that’s with a firm where you really aren’t worried that your money is gone…Their experiences, honestly, look very bad.”
More than a dozen regulators I spoke with for this column said they saw issues exactly in line with Borg’s concerns, but felt that bitcoin exchanges were out of their purview, even if the customers—the theoretical victims if an exchange were to collapse—were in their state or region. It’s largely out of the regulators’ purview because most of the operators are located offshore.
“Dealing with these exchanges should be no different than dealing with your bank or your financial institution,” Borg said, “and we would tell you that you never do business with a bank that does not know you have money on account, or that is asking for your passwords or that doesn’t seem to remember the account links you established when you started the account. Now we are saying that you should never do business with a bitcoin exchange that has the same problems, or that has to ask you how much bitcoin you’ve got.”
Borg noted that the visible issues some investors have had with certain exchanges might have investors wondering if the entire crypto-currency world is a rip-off. But he stopped far short of that kind of warning, and said it’s entirely possible that investors’ experiences could vary entirely based on how they trade bitcoin, the same way stock investors would have different experiences using a respected brokerage firm and a boiler-room shop. Gox is arguably the biggest name, but it’s clear from my discussions with traders that it is also the operation that gets the least respect, particularly among veteran traders. Mt. Gox did not respond to a request for comment.
Borg did say—and suggest that his published warning will say—that the validity of any crypto-currency “is a matter of perception.”
The big issue is not the value of the currency so much as “execution” and “settlement” of transactions.
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The latest WSJ article regarding MtGox might be of interest to this thread. It's paywalled, but has been quoted on reddit. Bolding mine. www.reddit.com/r/Bitcoin/comments/1ytb3o/japans_authorities_decline_to_step_in_on_bitcoin/TOKYO—Investors with funds tied up at Mt. Gox are looking for guidance from local authorities on how to get their bitcoin back, but without success, highlighting the regulatory vacuum in which the bitcoin exchange operates in Japan.
Japanese financial authorities decline to take responsibility for the crypto-currency.
Tokyo-based Mt. Gox, which accounted for more than 80% of all bitcoin trading at one point last year, halted all customer bitcoin withdrawals earlier this month, saying a bug in the bitcoin software allowed some users to alter transactions, a flaw that could make fraudulent withdrawals possible.The exchange told customers last week it was still working on restarting bitcoin withdrawals.
On Monday, Mt. Gox chief Mark Karpeles resigned from the board of the Bitcoin Foundation, the most influential trade group advocating for the virtual currency. After the news, which came Sunday evening in New York, Mt. Gox bitcoin continued a recent slide, trading at around $150 late in Tokyo on Monday, while the Coindesk bitcoin index, which tracks the price of the currency on two other major exchanges, traded at $575. At the end of January, Mt. Gox bitcoin was at $939
.
Investors with bitcoins tied up at Mt. Gox have flown from as far away as the U.K. to protest outside the exchange’s offices. Some investors say they have contacted the Financial Services Agency, Japan’s banking watchdog, to ask regulators whether there are any rules protecting Mt. Gox customers, but obtained no clear answers.
Some lawyers and other legal experts say a deposit-taking entity such as Mt. Gox would normally fall under the FSA’s jurisdiction. The FSA, however, said it isn’t the agency’s job to supervise crypto-currency exchanges.
“Bitcoin isn’t a currency; it works as an alternative to currencies, like gold,” an FSA spokesman said Monday. “The FSA is in charge of currency-based services. Therefore, bitcoin exchanges are not a subject to our regulatory oversight.”
Unlike their counterparts in many major economies, including the European Union, China, Russia and the U.S., Japanese authorities have been relatively silent about bitcoin. When asked in December for his view on bitcoin generally, Bank of Japan Gov. Haruhiko Kuroda said that he was “very interested.” He said the central bank’s research arm was looking into the currency, but that he couldn’t comment further.
A Bank of Japan spokesman said Friday that the bank “is not in a position” to regulate bitcoin and its exchanges.
The Ministry of Finance said on Monday that it isn’t its job to supervise bitcoin and related services. The Ministry of Internal Affairs and Communications, which is in charge of information technology and related issues, said, “We are not in a position to make any judgments on this matter.”
Mr. Karpeles told The Wall Street Journal last week that he has discussed the company’s business model with Japanese authorities to ensure the firm was operating within the law. He didn’t elaborate. People with knowledge of Mt. Gox’s business say the exchange had had communications with the FSA. The FSA said Monday it hasn’t corresponded with Mt. Gox recently and hasn’t given the exchange any operational advice.
No country has recognized bitcoin as legal tender, though some accept it as a virtual payment method and have moved to regulate bitcoin exchanges. Mt. Gox registered as a money-services business in the U.S. in June last year after authorities said it wasn’t properly registered in the country.
There are also concerns about how authorities should respond to possible cases of fraud involving bitcoin, even if they don’t recognize bitcoin as a currency. In China, local media reported that three people were arrested for allegedly operating a fraudulent exchange and absconding with investors’ money last fall. The country’s central bank forbids financial institutions from doing bitcoin-related business, though individuals aren’t barred from trading the currency.
In the case of Mt. Gox, investors haven’t put forward fraud allegations but expressed concern that given the potential that bitcoins were improperly withdrawn in the past, the exchange might not be able to meet its commitments.
According to documents seen by The Wall Street Journal, Tibanne Co., which operates Mt. Gox, is expected to generate a small profit in the fiscal year ending in March from exchange transaction fees. The forecast, however, assumes bitcoin prices well above current levels.
Two people briefed on the exchange’s operations said the company has enough money to process all the customer withdrawal requests, saying external factors were behind any payment delays.
Eric Bosma, a 60-year-old part-time health-care worker from Mission, British Columbia, said he has been trading bitcoins for the past six months to try to earn extra income, but hasn’t been able to withdraw the roughly 5.25 bitcoins he has in Mt. Gox. “I have contacted Mt. Gox many, many times in the past two weeks and all I get is what seems to be bot emails,” he said in an email. “All I want is my bitcoin back.”
For more than a week, Londoner Kolin Burges spent his days camped outside the Mt. Gox offices, holding a sign reading “MT. GOX — WHERE IS OUR MONEY”. He had deposited 250 bitcoins at the exchange in early January, thinking to keep them there temporarily, but has been unable to withdraw them.
“I want to get my bitcoin back, or get Mt.Gox to bring back public confidence that the company is solvent and people’s money are safe,” said Mr. Burges as he started his protest on Valentine’s Day. Mr. Burges was later joined by another protester. The two added chairs and a live video stream to their setup. On the stream online, the two could be seen mostly checking their laptops, with signs propped up calling for others to join the protest.
Mt. Gox didn’t respond to phone calls and emailed questions about Mr. Karpeles’s resignation, its financial position or the status of its customers’ bitcoin. In an email interview last week, Mr. Karpeles declined to answer any questions about customers’ funds.
Other people interested in bitcoin are divided over the need for outside regulation.
“Mt. Gox seems to be the microcosm of why self-regulation doesn’t work,” as customers are left unprotected from potential losses, said Boston University professor Mark T. Williams. He acknowledged, though, that Japanese regulators are in a “precarious situation.”
Weighing in on the Mt. Gox matter would force authorities to become an active enforcer of bitcoin businesses, yet continued silence could invite other Japanese businesses to start trading bitcoin, he said.
Many in the bitcoin community say regulation goes against the spirit of the currency.
“Philosophically I’m opposed to the very idea of regulation,” Roger Ver, a well-known, Tokyo-based bitcoin investor said on Monday, though he added he couldn’t speak to the case of Japan. He also declined to speak specifically about Mt. Gox.
Patrick Murck, general counsel at the Bitcoin Foundation, told a U.S. congressional hearing in November that more work needed to be done on the legal framework around bitcoin. “Though challenges exist, Bitcoin does not pose a unique or unsolvable challenge to law enforcement or existing regulatory structures,” he said.
Meanwhile, Japan took a clear stance on regulations for protesters. Mr, Burges and his fellow protester, who spent last week outside of Mt. Gox’s offices, were told by police Friday that registration was needed in order to demonstrate. The two said they planned to continue their protest in other ways. |
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LOL.  |
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remember that theymos is very ideologically driven
i thought that once. His ideology is certainly "different", kind of like Amir's is "different". |
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The truth is, cryptocurrency is an EXTREMELY valuable invention to the world.
Of course that doesn't mean BTC will be the best implementation ever of a cryptocurrency or the one which will be mainstream in 10 or 20 years. Technology is full of instances where the pioneers are not the dominant market forces in later years. |
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LOL that you are pretty much buds with the guy who admits to stealing your laptop. You must be the biggest bitch in the world for someone to tell you to your face they stole your shit.
Obv this is 100% fake though.
And his room-mate - who must have been around years ago to be aware that the laptop had a wallet on it which contained 1200 BTC - hasn't mentioned it at all in the past few years as the price of BTC has risen despite the fact that the room-mate presumably wasn't in a Xanax-induced haze following a car accident. Of course it would make a little bit more sense (although not much more) if the room-mate did, indeed, pay for the BTC and is now resentful that he's missing out on a potentially big pay day (his own fault for not having control of the wallet himself, if that's the case). |
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The first headline is outright wrong. The legislation doesn't make crypto-currency "legal tender" (that has a very specific legal meaning). What's going to be interesting now that it's explicitly lawful for alternative currencies to be used is to see what kinds of conditions are imposed on issuers (this legislation covers more than just crypto-currencies) and financial services handling these currencies (because they weren't previously recognised as "currencies", some financial services regulations weren't previously applied in this sector - that will almost certainly change now). |
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So you've gone from 'withdrawals will never be restarted' to 'when withdrawals are restarted the market will crash', make your mind up  I've never said that withdrawals won't be restarted and I never said "the market will crash" - Gox price will if they lose volume. There are any number of scenarios which could cause that to be the case, but nothing is certain regarding MtGox right now. If they do resume withdrawals, it means nothing about their viability as a business as they'll be in a position to ensure that the rate at which funds are leaving MtGox is less than the rate at which funds are entering MtGox. They could be broke and hide it for a long time providing they control the rate of withdrawals. I believe that the best thing for Bitcoin overall would be for MtGox to fail now rather than continue failing by degrees, but I acknowledge that they could keep limping along for quite a while. You only need to look at the dark markets to see how willing people are to keep giving funds to services which have repeatedly failed if they think there's the slightest chance they'll benefit from doing so. The same reason why it went so low on gox without any real proof that they are insolvent, speculation and rumors. The price should be low on an exchange where withdrawals have been halted, irrespective of any speculation about their financial state. |
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He's got a negative trust rating. His profile says "founder : CyberDonate". There's a user new user called CyberDonate who is probably the same person (Trance's profile and CyberDonate's posts both reference Sean's Outpost). https://bitcointalk.org/index.php?action=profile;u=223942;sa=showPostsThere's a CyberDonate blog (goes back to 2010) and also a CyberDonate Twitter Want to expand on your relationship to CyberDonate, Trance? |
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Gox will be shouting it from the roof-tops when they intend to resume withdrawals.
Of course once they announce the new withdrawal limits and the measures they're taking to ensure there's no mass exodus of funds from Gox, who knows how the market will react. A ton of people are going to be submitting new withdrawal requests, so the "standard" withdrawal time on Gox is going to blow out even more. That could drive the price down even further if Gox doesn't provide convincing evidence that they're solvent (even if they do, how many people want to wait months to be able to get control of their BTC/fiat).
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