The timing of any acceptance of Mt. Gox's application for civil rehabilitation will have major implications because, according to Article 124 of Japan's civil rehabilitation code, liabilities may be registered at market values when rehabilitation commences. This throws cold water on Mt. Gox's delusional habit of valuing its obligations at its rock-bottom internal price (referenced in the leaked 'Crisis Strategy Draft' document). Moreover, the price of bitcoin has recovered by around 20% since the initial filing, vastly increasing Gox's outstanding liabilities.

However, Article 124 also allows the court to order that valuation of liabilities be made on a continuing basis as the company restructures. Given bitcoin's volatility in recent years, this could leave a restructured Mt. Gox chasing an ever-mounting pile of obligations to bitcoin-denominated creditors – or it could mean those debts shrink to nearly nothing, if bitcoin collapses under the weight of failures like Mt. Gox's own.

Hi all!

low energy nuclear reactions have been more rumor than fact for a long time.

This may change now, over the next 1-2 decades.

http://www.forbes.com/sites/jeffmcmahon/2014/01/04/doe-mentions-technology-behind-the-home-nuclear-reactor-in-funding-opportunity/

Actually I think it is a nightmare, that will change the world forever. Synthetic rare metals will mean that there is nothing left to protect people from government created fiat inflation. Real estate is only for people that are already relatively rich, and it is also not portable and cannot be hidden from confiscation, which is a real issue in non-democratic countries.  

Jewish real estate was confiscated by the Nazis, escaping with gold was a possibility.  

WHAT DOES THIS MEAN FOR CRYPTO? Imagine that in a few years a breakthrough is published and Gold, Platinum et cetera can be mass produced as a by-product of a LENR reaction.

http://www.kitco.com/ind/Albrecht/2014-02-25-Alchemy-2-0-Low-Energy-Nuclear-Reactor-Creates-Gold-and-Platinum.html

Trillions of wealth will seek new targets. Real estate will be even more unaffordable than today, governments will abandon any limits and print fiat like mad, knowing that the gold standard will be history.

We will be helpless cows, milked by inflation and rental payments.

Cryptocurrencies however, will benefit from the gigantic stream of money, and the cheap LENR energy.

Expect $ 1000 000 BTC and $ 20 000 LTC, when the LENR shit hits the fan.  

Hope you can sleep tonight ....

Cheers
Leo

The value of all CURRENCY is closer to $5T putting an upper limit on value of about $240,000 USD (circa 2010) per BTC.   Bitcoin replaces cash not fractional reserve account balances.  Using global M0 is the apples to apples comparison.

...

So what does this have to do with the OP point?
While the global money supply can (and probably will) inflate that would only increase the nominal PRICE not the VALUE.  If the money supply doubles over the next hundred years then one would expect the price of BTC to also double but then again so would the price of everything else.  If Bitcoin replaced all currency globally (not a scenario I find likely but good as an upper limit) we would expect the price to be on the order of $240,000 when measured in 2010 dollars.

What kinds of acts conducted by the debtor before the commencement of insolvency procedures may be deemed invalid after the commencement order is given, and thus shall be avoided in court?

A.    A court-appointed trustee (in bankruptcy proceedings and corporate rehabilitation proceedings) or a court-appointed supervisor (in civil rehabilitation proceedings) has the power to invalidate (avoid) acts taken by the debtor before the commencement of relevant insolvency procedures which are deemed to impair equality among the creditors and/or are against the concept of the insolvency proceedings.  The outline of the trustee’s/supervisor’s power to invalidate (avoid) such acts is as follows.

    First, any acts conducted by the debtor while knowing that it will prejudice its creditors, in other words, acts which reduce the debtor’s assets, may be avoided.  A typical example of this is the transfer of property with the aim of concealing or disposing of an asset at a low price.  However, if the beneficiary of such acts did not know, at the time of the act, that it would prejudice the creditors, the said act will not be avoided.  In that case, the beneficiary must prove that they had no knowledge of the possibility that such actions may be prejudicial to the creditor’s interests.

    Second, any gratuitous acts conducted by the debtor within six months prior to their becoming insolvent may be avoided.

    Third, any payment or provision of security interest to an existing creditor by the debtor after their becoming insolvent may avoided.  In other words, after becoming insolvent or the petition for commencement of insolvency procedures is filed, any payment or provision of security interest to an existing creditor by the debtor may be avoided if the creditor knew of the debtor’s insolvency at the time of the payment, or the provision of security interest.  In addition, any payment or provision of security interest to an existing creditor by the debtor within thirty days before their becoming insolvent may be avoided if the act is not a legal obligation at the time of the action.

    Where an act is avoided, the person who benefited from the act shall restore the assets of the debtor to its original state in principal, and their damage as a result of the avoidance shall be treated as an unsecured claim.  However, a right to claim for the counter-performance received by the debtor shall be paid prior to unsecured claims as administrative expenses.]Q12. What kinds of acts conducted by the debtor before the commencement of insolvency procedures may be deemed invalid after the commencement order is given, and thus shall be avoided in court?

If you had a choice between 1BTC or 1oz of Gold, which one would you choose?

WARNING: PURE SPECULATION

I'm changing my tune.  Yesterday I thought the 750,000 BTC figure was FUD to get certain Gox creditors to voluntarily accept 10 cents on the dollar for their GoxBTC.  The theory I'm leaning towards now is that the 750,000 BTC figure is true and Gox has indeed been operating as a fraction reserve.    

The theory is that sometime in 2011--probably after the crash from $30 to $10--MtGox was lax with security and a group of thieves or hackers was able to steal about 500,000 to 1,000,000 BTC.  At the time, this only represented $10 million dollars.  

To avoid discrediting bitcoin and embarrassing himself, Mark pretended that nothing happened.  He knew that BTC withdrawals were roughly balanced by BTC deposits (typical fraction reserve banking) and he hoped to slowly earn back the bitcoins through trading fees.  

Meanwhile, the thieves worked to mix their coins with non-stolen coins and slowly sold them off, thereby driving the bitcoin price eventually to $2 later in the fall of 2011.  It was this extra selling pressure that continued through the remainder of 2011 and 2012 that kept the price of bitcoin artificially depressed.

Meanwhile MtGox was buying coins whenever it had spare cash.  But as the price of bitcoin exploded in the spring of 2013 they saw their liabilities in $ terms increase tremendously.  But at this point they had to keep going, even using customer deposit money to buy coins from other exchanges or individuals.

The problems at MtGox (probably due to extreme stress of MK) got worse, and MtGox lost market share, slowly dwindling down MtGox's small supply of coins.  

MtGox purposely mixed immature coins into withdrawal transactions, and later used the malleability excuses, all to buy time to somehow get more coins and make good on withdrawals.  

But eventually all hope was lost.  Their supply of coins dwindled down to 2,000 BTC while their bitcoin liability were a huge 750,000 BTC.  

And here we are today.  If this theory is correct, there are 750,000 less bitcoins in existence than what everyone thought.  

Read the article; its title is wrong.

The judge ruled that the Madoff trustee can't demand money from the banks who served as intermediaries.  Technically that's not even a clawback, so the article's title is just wrong.  It should be "Madoff Trustee's Lawsuits against Banks Blocked".

Also, that article six months old; since then, something happened (higher court appeal?) and JP Morgan settled, offering $2.6 billion.  A few weeks ago: 2014-01-29 Some Madoff Investors Shun J.P. Morgan Settlement.

Here are some better articles:

* Madoff Trustee Gets a Green Light on Clawbacks
* Madoff clawbacks "just" $2.6 billion

As of a month ago (source):




BTC on Gox were trading at a 10-15% premium over all other exchanges for many months.

But I don't think this matters.  Madoff investors could have put their money in the S&P 500 and made something like 7%.  They definitely didn't exempt 7% CAGR ( = almost 100% over a decade) from the clawback.  The fact that you could have profitably invested your money somewhere other than the ponzi scheme doesn't really matter.

Banks and governments don't cause one to "lose" hundreds of thousands of bitcoins.

Update: A spokesperson in Senator Manchin’s office said that his call for regulation doesn’t yet extend to other cryptocurrencies, such as Litecoin or Dogecoin. And asked how such a ban would be technically feasible, he admitted that the senator is still trying to gather information on “different ways to protect consumers” that might entail a ban or simply increased regulation.

...

The entity that acquires MtGox gives the clients an offer they can't refuse:
We give you $440 per imaginary BTC you have in your account balance and reset your BTC balance to zero.

Another potential buyer is of course Facebook;

Facebook paid 19 Billion dollars for Whatsapp, that's $42 per user, an app that barely generates any revenue.

Facebook could pay $500 per verified MtGox account and $100 per unverified account

verified users = 550,000 * $500 = $275,000,000
unverified users = 550,000 * $100 = $55,000,000
Total = $330 million dollars

The current owner of MtGox get's a symbolic $1 payment for the deal, and the $330 million dollars are used to settle the missing coins.
MtGox clients can receive at most $440/BTC in this example
$330M/750K lost BTC = $440

Yeah, it's definitely naked so I know there's a credit-risk, but we work together and I know he's good for all but the most extreme outcomes.  Still I'm tempted to help him along by capping his downside (maybe making the deal a call-spread $1000 vs. $2000 or something - i.e. I sell him back a $2000 call), though it's a shame to lose the convexity to the upside.

If you want to be extra-brave, buy goxcoins on builder.

so...FBI to use silkroad coins to bailout gox, thats how it works right?

The EAZE POS application will soon be available for the iPad and any Android tablet