My only problem with this is that those who give the coins back to Dooglas are actually punished by having their total percentage of the pool diluted.  Those who keep the coins benefit twice - first directly by keeping the coins and then secondly by having an inflated ownership to what they actually invested since their percentage goes up and the "honest" investors goes down.

Investors should not be punished here either.  The right solution would be for Dooglas to debit the ill gotten gains from those investors who received them and credit it back to himself  - not make it optional where the honest people are now double punished. 

Can we just do that? It makes the most sense - I am down as it is and do not want to further compound it.  Yet, I do not feel Dooglas needs to pay so harshly for his error since no harm was truly done to investors.  Return the donations, take back the ill-gotten profits and let's just move on.  Oh, and can we decrease the max profit please;)

Nice summary Zeroblock.

What makes you say they will lose against against CoinLab?  I haven't really followed that story much.

It is impossible to know Mt.Gox's liquidity position at this moment, but there are things we know for certain:

1.) Mt.Gox's US entity, Mutum Signum had its accounts frozen.  More than likely a large portion of their USD revenue was tied up in that Dwolla account.  They may or may not get these funds back. I would expect they would have to get their Money transmitter license in all 50 states before these funds could be released.  That would take at least 12 months and $2M in fees/surety bonds(1)


(1) http://thegenesisblock.com/town-hall-discussion-with-gavin-andresen-and-patrick-murck/

Thanks Bugpowder.  I somehow missed this post before.

I'm so sick and tired of this whole thing at the moment, but I'll carry on with it and see how it goes.  I just don't feel good about any of it any more.

This thread is terrifying. Has anyone considered that their Japanese accounts were frozen along with (or shortly after) their Mutum Signum U.S. account?

It's hard to believe that they would continue to delay payouts unless they had absolutely no way to send funds, as this debacle is causing significant damage to their already shaky reputation.

It's 5% currently.  But for the foreseeable future it doesn't matter, since not many investors will be making new profits, and so I'll be charging nothing.

I made an address for donations to help towards my loss:

  17r66d9Sis99eZWtsZpEuK1rtpZCgr2sDU

I received a little under 10 BTC in donations, and also was given 120 BTC back by the whale himself.  So I'm "only" 1170 down now...

dooglus from an objective investor perspective here this site is growing too quick too fast. I understand we all wanna get rich quick, but there are risks with rewards. This site IMO is not ready to start accepting action over 50BTC. There iS NOTHING WRONG WITH THAT either. But with the size and influx this site has grown it should'nt come off as a big suprise.

I think we should scale down the operation and grow A LOT MORE SLOWLY and then "mistakes" or "errors" are less like to be as exasterbated and as threatening to your bottom line. YES we all want whales, but the MGM didnt start taking whales over night. This is where profiling comes in, but that's damn hard with BTC being made the way it is.

Moving forward what are we going to change to prevent this mistake again?

I just made a withdraw from Mtgox,  I will update when it's in the account. 
Mtgox has always been a good business in my eyes,  they have had issues in the past and will have issues in the future but this is expected when you are the first of your kind in a brand new field that nobody else can do better.
People are always bagging out Mtgox but these same people would not know where to begin if they where given the task Magical Tux and team face. 

If you are that annoyed at Mtgox for dealing with their bank issues then withdraw your bitcoins through another service if you can find one as good.

A Just-Dice customer is emailing me over and over asking for a refund.

Apparently he left his phone containing a funded Bitcoin wallet and a Just-Dice account in a restaurant.  Somebody found it, deposited his coins into his pre-existing Just-Dice account, and lost them.  Not all of his coins, just around 95% of them.

Now he wants a refund.

I'm wondering if any other customers have lost bets recently that were placed with stolen coins, and if they would also like a refund.

And I thought I had better check with the investors first, just to make sure they don't have any problem with me refunding bets from the bankroll when people tell me they didn't mean to bet for whatever reason...


On a serious note, am I right to tell this guy that it's not up to Just-Dice to refund his coins?  He seems pretty insistent that it's the site's fault the coins were stolen.

Nakowa has taken site profit from 2000 down to 700 in the last 30 minutes.

Sick.

I don't have historical figures of what you would earn each week if you had a bitcoin invested.  It would depend on all the people investing and divesting throughout the week, since that causes your share of the profits and losses to change each time.

What I do have is the amount wagered each day, and that should be what you're interested in.  The house expects to profit 1% of these amounts each day, and you expect to profit accordingly, based on your share of the bankroll.

Didn't they claim to have processed over a million dollars in withdrawals over the "two week" break? Odd that there have been zero posts here saying they received USD over that period.

There is 1 implausible scenario (Mt. Gox official explanation) : Mt. Gox sends so many wires it overwhelmed the 2nd largest bank in Japan's ability to send wires.

There are 2 plausible scenarios, one bad, one worse.

Scenario 1) There is major regulatory pressure that has come down and we are only seeing a bit of it from our vantage point. Dwolla seizure is just the tip. Many banks are refusing to accept wires from Mt.Gox account. People on IRC say that wires from Gox to Citibank never showed up, called Citibank and they said they refused the wire and will refuse all future wires from Gox.

Gox is frantically trying to open accounts in other banks or in other names to disguise the origin of the transfers so it can resume sending wires out.  How long before they get caught?   This is the bad scenario.

Scenario 2) Gox does not properly segment customer funds, and without regulatory oversight the recent secular shift in market sentiment to more bearish tone has caused a major imbalance in wires in vs. wires out.  They don't send wires out because they don't have a segregated pile of customer money.  They spent all the money on hiring new people, or expanding, or speculating, who knows.  All that matters is they don't wire out till people wire in.  Gox is not a bank that has many loans out, where fractional reserve banking works, it is an exchange or brokerage where customer accounts should be segmented.  Gox has been in seg fault for weeks and would be instantly shut down if there was any sort of regulatory oversight on their operations.  This is the worse scenario.

Seriously...no takers?

Number 8 has started. Go buy your tickets now. I updated the first post. We need a whale. Jackpot at 0.03483 BTC.