Jonathan Ryan Owens locked Rebate, Zip.A, Alberto & BDT thread

[El Cabron]

Copy and pasted from this locked thread. https://bitcointalk.org/index.php?topic=101098.0

"I was involved with Alberto on Bitcoin Rebate and Kronos, and worked with ludvig(DeaDTerra) and others to raising bitcoin for both projects on the basis of a 50/50 ownership. Based on everything I was told (and believed), both myself and others believed that it (Rebate) was a viable project. If I could go back and do it again, I would *not* have had any involvement with Alberto.

Right after Bitcoinica shut down, Alberto informed me that he had been working on the beginnings of a margin trading platform. Given that I was looking for opportunities to leverage the ZipConf back end for instant deposits into exchanges, a perfect fit for margin trading / multi market hedging purposes, I actively started working with Alberto to pursue ZipConf integration, and a multi market orderbook for the Kronos project.

After Kronos went live, Alberto decided of his own accord that he would go against Eric, Matthew and my development protocols, and he left the withdrawal page wide open and vulnerable to a scripting attack, without *any* protections or manual verification requirements in place for withdrawals from the hot wallet which he controlled. Alberto also went against protocol and handed out invitations outside of the scope of the defined invitation list for early testers.
As one might expect (hindsight is 20/20), Kronos experienced a massive hack via what ended up being a wide open withdrawal page, and thus ended the Kronos project, and any and all involvement with Alberto and my group.

This staggering loss threw a monkey wrench into further development efforts. When I heard that Alberto was pursuing funding for BDT over a month later, I told the people I heard were involved with helping him the entire back story, and did my best to warn them off helping in any way shape or form. Nobody listened.

I also informed Alberto that I would continue to do my best to block him at every turn, and further demanded that he complete the code base for the Bitcoin Rebate project, and deliver it to my designated 3rd party for audit. Alberto finally agreed after some tense words, and and yet in the end, it's still simply standing still. The initial raise on Rebate was on equity rather than Bond, because it was expected that the development and user growth path may take some time, and would require more organic growth than with something like margin trading, which everyone was already familiar with.

To be clear: I believe (along with others) that the loss sustained was Alberto's doing (Bit day trade). He's not as clever as he thinks he is, and though I cannot prove beyond a shadow of a doubt that he was the thief, I do not for a second believe that Alberto is blameless. Not even a little bit.

The loss experienced was a crushing blow to the team, and if we could all go back and do it again, we wouldn't. We were trying to rush to market to fill a vacuum, and we didn't have a solid security plan in place to deal with these types of problems. I am to blame for trusting Alberto, and for the lack of oversight and necessary precautions. Sometimes opportunity presents itself, and we make terrible, stupid mistakes in our rush to push things out into the marketplace.
I'm working diligently on closing out both Rebate and ZIP.A on GLBSE. I have had nothing but good intentions, yet the end result is that my experience so far has been terrible.

The constant and nagging anxiety of knowing I might let people in the community down because of everything that has happened has severely affected my well being, and has haunted me ever since the day that Kronos was "hacked."

The realization that I had gotten in to bed with a criminally minded guy, leaves me to only blame myself. Nothing changes the fact that I am ultimately responsible to the people who have been in my support. What's worse is that *very few* real world investors want to touch anything Bitcoin related with a ten foot pool. If you have to ask yourself why, take a look at the current price. Look at the ponzis (Pirate), look at the most robust markets and ask yourself "If I was an investor, would I put any faith or money into Bitcoin businesses?"

For 99% of investors who could make Bitcoin happen, the answer is a resounding "NO."

After the hack on Kronos, the developers on ZipConf got spooked, and changed their stance on the viability of a public instant confirmation service, and they changed their stance on operating it publicly. In other words, while the tools and back end have been built to support multiple exchanges through ZipConf, and the technology is solid (and is being audited by a 3rd party as soon as next week), the people involved changed their stance considerably after the Kronos hack; They got spooked, and their feelings regarding risk tolerance turned a slight apprehension of untested technology and theoreticals into a firm stance that they would not operate publicly, and possibly at all, even privately through trusted exchanges and members.

I'm actively seeking the assistance of a few friends and past associates to raise the money needed to retire the BitcoinRebate debacle, and hopefully also retire ZIP.A obligations based on the current negotiations (code audit is first). Since Alberto (Bit Day Trade) has no assets remaining, or intent to pay, I am on the hook entirely to retire all GLBSE obligations. I accept this, and I may have to sell my good kidney to make that happen.

In the meantime, I've been working hard to make a real world retail digital currency exchange happen in San Francisco, which would be a prime customer of the Ringcoin and associated tech.

To everyone who's affected: I'm incredibly embarrassed, and I'm deeply sorry. I still have hope for the future. I can't be certain that it will work out for the best, but I'm going to continue to try until my last breath.

Feel free to call me if you’re a shareholder in either Rebate or Zip.A and have any questions.

Jonathan Ryan Owens
760-420-3577

https://bitcointalk.org/index.php?topic=83784.0
https://bitcointalk.org/index.php?topic=79110.0"

Just want this to not be edited. Thanks

[server]

Trading REBATE suspended at GLBSE ?

I get "REBATE not found."

[repentance]

Link to pastebin of behind the scenes conversation between Alberto and Bitcoin Police regarding this.

https://privatepaste.com/5241fafb45

[repentance]

Link to pastebin of behind the scenes conversation between Alberto and Bitcoin Police regarding this.

https://privatepaste.com/5241fafb45

This is the type of stuff I assume JRO did not want in his thread. Thanks for posting.

It gives some insight into the level of co-operation between MtGox and Bitcoin Police, which I thought was kind of interesting in itself.

Wayne Lee-Archer 2:54 AM
jjfarren: did you say the cartmell funds are still untouched on the
exchange ?  <<  its hard for us to say where the funds CAME from but there
ARE funds in an account belonging to JRO on MtGox.. and they were untouched
as of 2 nights ago when last checked
Alberto Armandi 2:54 AM
alright
Wayne Lee-Archer 2:54 AM
(btw i am not affiliated with MtGox at all; we are assisted by MagicalTux
directly on these matters)

Wayne Lee-Archer 2:56 AM
i think A MagicalTux <--> Cartmell meeting would be probably useful
2:56 AM
after all, MtGox is holding most of the bitcoinica funds from what i
understand
Alberto Armandi 2:56 AM
yes definitely, we need to see how reliable your informations turn out
2:57 AM
and if we can accuse JRO of being the holder of that account
2:57 AM
if magicaltux can provide those documents, then deal is done
Wayne Lee-Archer 2:57 AM
yes, totally
Alberto Armandi 2:57 AM
JRO will have to return back the funds
2:57 AM
or risk being sued by cartmell in california and being destroyed
2:57 AM
because this is actual theft
2:57 AM
not even neglicence

For the record, I got the link from reddit where it's been posted in multiple threads about BitDayTrade.

[repentance]

"because this is actual theft

not even neglicence"

Yeah... I wonder how much Mathew W will have to return if they get sued. I'm sure he will tell us all about his trip to Iceland on this project soon enough.

I'm pretty sure that Matthew wasn't one of the people who went to Iceland.  Also, for those who aren't following the reddit threads, Alberto is probably Bitscalper and BitDayTrade is apparently full of serious security flaws.

[labestiol]

Also, for those who aren't following the reddit threads, Alberto is Bitscalper

It's only suspicions. But it would be interesting to investigate that.
Alberto is indeed saying that he coded an arbitrage bot for Cartmell, but again, doesn't prove anything.

According to MrBitcoinZ on reddit, the codes are extremely similar. Would be nice to have both bitscalper & bitdaytrade leaked code to check

[repentance]

Also, for those who aren't following the reddit threads, Alberto is Bitscalper

It's only suspicions. But it would be interesting to investigate that.
Alberto is indeed saying that he coded an arbitrage bot for Cartmell, but again, doesn't prove anything.

According to MrBitcoinZ on reddit, the codes are extremely similar. Would be nice to have both bitscalper & bitdaytrade leaked code to check

Just qualified my statement with "probably".  I suspect that whoever leaked the pastebin probably has access to more information and will leak it in due course.

Re : Matthew and Iceland.

Production time is sustainable, but due to my scheduled trip to Iceland, (I was unable to go to Iceland because Icehill is no longer working towards registration there and I am no longer working with Jered and JRO on Icehill)...

https://bitcointalk.org/index.php?topic=84302.msg929809#msg929809

[ssaCEO]

uhhh...this is strange (from the pastebin)...

Alberto Armandi 2:52 AM did you say the cartmell funds are still untouched on the exchange ?
Wayne Lee-Archer 2:53 AM expect me to get back to you with more questions and perhaps a few introductions
Alberto Armandi 2:53 AM you welcome i'm more than happy to be helpful
2:53 AM sure
2:53 AM i'll be 100% avaiable
Wayne Lee-Archer 2:54 AM jjfarren: did you say the cartmell funds are still untouched on the exchange ? << its hard for us to say where the funds CAME from but there ARE funds in an account belonging to JRO on MtGox.. and they were untouched as of 2 nights ago when last checked

(emphasis mine). So bitscalper/bitdaytrade is also jjfarren, who's also labeled as a forum scammer? That's interesting. In any event it calls into question the validity of the convo.

I don't know enough about the details of their business to say who did what to whom. But I've done some minor work for JRO and been paid on time. I also know from talking to him that he's smart, honest, and he's not the kind of guy who would see his reputation screwed for a few thousand coins. Why would he? He's got way too much to look forward to. And it sounds like this chat is at the very least, very suspicious. Maybe Wayne Lee-Archer can show up and tell us if it's legitimate?

[mcorlett]

Wayne Lee-Archer 2:54 AM jjfarren: did you say the cartmell funds are still untouched on the exchange ? << its hard for us to say where the funds CAME from but there ARE funds in an account belonging to JRO on MtGox.. and they were untouched as of 2 nights ago when last checked

(emphasis mine). So bitscalper/bitdaytrade is also jjfarren, who's also labeled as a forum scammer? That's interesting. In any event it calls into question the validity of the convo.

Looks more like a quote from IRC than anything else.

[labestiol]

From this post we know that jjfarren was bitscalper (theymos confirmed that they had the same ip).
Now let's see what Wayne Lee-Archer will say about this chat log

[RaggedMonk]

There are a bunch of sockpuppets on reddit accusing BDT of being the thief responsible for the Kronos hack.  One previously promoted Yoon Yeonghwa's launch of posadoll.  Could MNW (a known sockpuppeter) be trying to sling mud on BDT?

http://www.reddit.com/r/Bitcoin/comments/yc6rf/we_demand_a_public_apology_from_uthezenpadguy/c5ua667

<conspiracy>
Is MNW responsible for the Kronos hack, and sees the BDT hack as an opportunity to shift the blame?
</conspiracy>

[MiningBuddy]

Also, for those who aren't following the reddit threads, Alberto is Bitscalper

It's only suspicions. But it would be interesting to investigate that.
Alberto is indeed saying that he coded an arbitrage bot for Cartmell, but again, doesn't prove anything.

According to MrBitcoinZ on reddit, the codes are extremely similar. Would be nice to have both bitscalper & bitdaytrade leaked code to check

i could leak one of them or better yet, ask mining budy about the bitscalper code.

I haven't been keeping up to date with things recently around here but I've just come across this stuff on reddit which is making for an interesting read, especially these leaked emails.
I'm not interested in conspiracy theories or drama, but in my opinion and completely 110% pulled from my ass here I would probably say Alberto is bitscalper and that bitdaytrade uses some reference to bitscalper code, before we terminated contact he was working on multiple iterations of the bitscalper theme and wanted to launch them under my name which obviously never happened, he was working very rapidly on the code and bitdaytrade doesn't look a million miles away from the sneak peeks I got access to while in contact with him.

This is all bullshit and pulled from my ass so don't hold it as gospel truth, its purely my opinion based on what I've been reading for the past 1 hour only

[labestiol]

From this post we know that jjfarren was bitscalper (theymos confirmed that they had the same ip).
Now let's see what Wayne Lee-Archer will say about this chat log

I thought i would check the skype id of Alberto, just in case :
http://imageshack.us/photo/my-images/204/bitdaydrade.jpg/

The post above state that jjfarren is bitscalper, and now I guess his skype profile confirm jjfarren is Alberto. I'm sure i'm not the only one knowing his skype id, so others will confirm.

[bitdaytrade]

My name is Alberto Armandi, i was born in Italy, 19/09/1983. I'm an internet entrepreneur who got caught in the Bitcoin phenomena about one and a half year ago.
Before Bitcoin, i have tried to launch several startups on my own, Wozad being one, a system for targeting digital ads based on your browsing history. It was doing well until Google Inc decided
to include the same type of targeting into their pervasive Adsense. The next effort was an hardware startup, Enso Limited, with which i've launched the highly controversial Zenpad. An early 5 inches
tablet powered by Android operating system. Enso managed to fail too, because of lack of funding but my failed endeavours did not leave a trail of destruction behind as i had and still have the determination to face any kind of trouble.
This is s short background, for those who missed it earlier, it can be easily found on the Official Bitcoin forum, in the Securities/BDT thread.
Now, fast forward to around April/May 2012 : I happened to get in touch with Jonathan Ryan Owens, who since the start of our relationship pictured himself as a sort of "Mr. Big" in the Bitcoin world and
shown to be able to use language fluenty, and to be able to convince anybody that he's actually skilled and a serious business man.
Since i did not have a real clue of who's who in this crazy, messed up community (do no take this as an insult, i'm referring to people who don't have exitation in runing other people lifes) i believed him,
and his claims of big success and profits and have developed trust on him and the group of people he was working with, again, i'm not trying to involve other people in this debacle, let's focus on Mr. Jonathan Ryan Owens.
We chatted extensively for a while and one day he came up with the ZipConf idea, inspired by some of my inputs and brainstorming. He started working on that and soon enough a site was online with that name.
Site's scope was allowing instant bitcoin transfers, without waiting confirmation from the network, as in classical bitcoin transactions. Business proposition seemed nice initially and Mr. JRO worked out
a lot of words to convince me and others it was so. He went ahead and held an IPO for this, as he said he needed lots of coins to make this happen. I was so convinced of the genuinity of this operation
that i have put Mr.JRO in touch with a guy i happened to know earlier, which is an important internet business man and investor. I valued highly my relationship with this guy, as he was funding my operations
and showing a lot of trust in me. I was hesitant, but finally made that mistake, i've procured about 2000 bitcoin in funds for the ZipConf endeavour, funded by this guy, which will go unnamed for privacy reasons.
Mr. JRO managed to put in place a written contract between him and this guy, the deal was that Mr.Jro would pay some interest over the 2000 bitcoin loan. I have later learned that this contract was never
signed and everything remained in the form of a legal agreement, bringing in even more liabilites for me, since i was the one to introduce the investor to JRO.
Everything seemed to be taking a great turn and I have then let Mr.JRO join the project i was working on, a custom Bitcoinica clone, coded entirely by me. It was intended to launch under the domain name btcxchange.net, which i own since July 2011, at that time Mr. JRO
said the brand name wasn't going places, and we agreed to call it Kronos.io. I went ahead, completed the coding work and deployed the site onto Mr. JRO controlled servers. The user interface i had
deployed was exactely the same i have in place at bitdaytrade, but Mr. JRO wanted a new design, so he hired someone to work out another skin, that took a couple of days. Please note that Mr.JRO managed
some very talented developers at that time, those who worked on ZipConf, but he never delegated them to have a check on Kronos.io source code, i've only later realized how much this is in contrast
with his claims of operating with high security standards and didn't link it directly to any malice backed act.
Almost At the same time, i was working on an unrelated project  Bitcoinrebate. After having shown Mr. JRO business plans and financial projections for said business, we decided to hold an IPO for it, to gather additional funds to be used on both rebate and Kronos.io.
At that time i demanded a payment for all the time and efforts i was putting in our projects and i was sent about 1000 bitcoin by Mr. JRO, claiming they were coming from a "trusted big lender".
I wasn't aware of how glbse worked at that time, nor i had realized the impact it might have had on my reputation, if things didn't go the way I expected. I have later learned that Bitcoinrebate IPO
was able to raise about 5000 bitcoin. I was never informed about this, not even a word.Mr JRO monopolized it all so i don't have a clue of where those coins (minus the 1000 i have received) ended up.
After Bitcoinrebate IPO i was instructed by JRO ( who always acted like a dictator and a boss ) to complete the work for Kronos ( implementing the new skin ) and prepare it for launch.
I have executed my duties and the site was launched. About one week later, Mr. JRO came up that he didn't need the coins initially funded by the unnamed investor and asked to return them back, to avoid
paying useless interests. Stupidly enough, i told him to just send him back in a mtgox account i was sharing with the investor, for different kind of operations, without asking him confirmation first.
I thought it was safe to do so and really didn't have a clue of what would be going to happen shortly.
I have made another mistake in this context, i have used this mtgox account for testing the Kronos.io hedging bot without asking direct confirmation from the investor, just assuming he would be ok with it
since my agreement with the investor was about generating profits from the coins he lend to me. I was managing money for this guy for a while and so i thought it was ok doing so.
The mtgox account passwords were know only to me and the investor, but Kronos.io had an automatic withdrawal feature, so the mtgox account was configured to allow bitcoin withdrawals via API.
Some days passed and apparently everything was going well, but one morning i woke up to find the mtgox account emptied and Kronos.io hacked.
I freaked out for a while then went ahead trying to track down what happened. It turned out that someone with knowledge of how the site worked internally (someone who was in possession of the source code)
had exploited it, exactely like it happened today with Bitdaytrade, but unfortunately, the mtgox account was emptied too, because of the automatic withdrawal feature.
I still have full logs of what happened then, with IP addresses and bitcoin addresses that received the loot.
Mr.JRO reaction to this was controversial, first he disappeared for days, claiming he was in a confused mental state, and dutied other people to deal with me. I was obviously trying to get in touch with him
like crazy, i couldn't get a hold of him on the phone at that time and i've tried for weeks. Then after some weeks he re-appeared online and blamed me harshly of incompentence and stupidity. Just like
it's happening now with Bitdaytrade, he deemed Kronos.io project dead, and gave me advice to work on different things and forget about Bitcoin.
Obviously i felt deeply ripped off, i had the investor who lost thousands of coins out of this big mess asking me what was my plan to recover the loss and going forward, with our relationship completely
destroyed on a trust level, and on the other hand i had Mr.JRO blaming me in a unmeaningful way about stupidity, incompetence, and such.I had determined at that time that my only choice was going forward with
the project, alone, i had high hopes that i would be able to repay the cumulated debt with profits i would be making from it. I then decided on another brand name, Bitdaytrade, asked support from some trusted
community members for holding an IPO to raise the necessary funds for its operations and went ahead modifying
the source code to allow Gold trading, finally launched a beta with this limited service, to avoid thousands of users flocking in, and keeping the risk level at a minimum while i ironed out all the kinks left.
Sometime passed, some users reported bugs and other problems, i had worked hard to fix all the issues and get the service to an acceptable level for the community. A lot of hack attempts where attempted
but the site did not suffer any major breach, and it was deemed safe by me.
I had initially implemented the blowfish/bcrypt algorithm for storing passwords safely but because of some recent technical problems i had to swith back temporarely to MD5. I had setup the site in way so that
when a user logged in, his password would be recovered and stored in MD5, you could have seen that by looking at the javascript files used in the login page.
Bitdaytrade IPO was held and necessary funds raised, for doing this i had to leverage the trust of other community Members, which Mr.JRO tried to block from putting trust in me, banking on the Kronos hack
story, and telling them all that i was obviously a thief. He didn't succeed as all of you noticed and Bitdaytrade started operating, i've first allowed BTC/USD margin trading feature privately for a week
and then opened it to the public, on Monday 13 of August.
Mr. JRO got in touch with me about a week ago, trying a last approach to block me, he demanded a "rapid prototype of a margin trading site" and in exchange he would not have made the Kronos.io hack public.
He added that i was losing out a great opportunity of working with him on a realworld exchange for virtual currencies and a sort of startup incubator
for bitcoin related projects.I have then understood where the funds from ZipConf, Rebate and Kronos.io ended up and obviously passed on this offer and went ahead with my plans.
What happened today is a reiteration of this blackmailing attempts, but with a more evil and criminal plan.
I strongly believe, and what i wrote in this explainative post gives a clear evidence of, that behind everything that was posted on reddit.com against bitdaytrade there is Mr. Jonathan Ryan Owens.
He used the previously stolen from him Kronos.io source code to orchestrate all of that you witnessed today, and managed apparently to have the community believe his story.
Not even one bitcoin was withdrawn from Bitdaytrade.com under today's attacks, and all funds are safe. Server will be kept offline for further investigation, and gathering of evidences to be presented upon
filing a criminal deposition with all the legal authorities i am/will be able to. Stay tuned for developments.
I'm deeply sorry and i publicly apologize to everyone for the mistakes i made in this mess but it will be sorted out and in a elegant way.

Best Regards
Alberto Armandi

[RaggedMonk]

Also, for those who aren't following the reddit threads, Alberto is Bitscalper

It's only suspicions. But it would be interesting to investigate that.
Alberto is indeed saying that he coded an arbitrage bot for Cartmell, but again, doesn't prove anything.

According to MrBitcoinZ on reddit, the codes are extremely similar. Would be nice to have both bitscalper & bitdaytrade leaked code to check

MrBitcoinZ is one of the reddit sockpuppets - the only think in his post history is accusations against BDT

[vampire]

He used the previously stolen from him Kronos.io source code to orchestrate all of that you witnessed today, and managed apparently to have the community believe his story.

LOL

[dree12]

Alberto = Bitscalper as far as I am concerned. They are both from Italy, they both use the name jjfarren. This is 90% proof that they are one and the same. If we can have IP confirmation from the admins, that would be great too.

[vampire]

Alberto = Bitscalper as far as I am concerned. They are both from Italy, they both use the name jjfarren. This is 90% proof that they are one and the same. If we can have IP confirmation from the admins, that would be great too.

Evidence:

https://bitcointalk.org/index.php?topic=77195.0
http://www.mobileread.mobi/forums/showthread.php?t=78064&page=7
http://www.ipadforums.net/ipad-general-discussions/291-tons-ipad-competitors-popping-up-2.html
http://www.who.is/dns/bitscalper.com/


^^^

bitscalper.com   SOA   10 hours 40 minutes      exoware.mars.orderbox-dns.com. jjfarren.hotmail.com. 2012010406 7200 7200 172800 7200

Bitscalper=jjfarren=Alberto=Scammer

[Kluge]

Alberto saw hack first, IIRC. He took the action of locking the user's account and telling him he knows where he's located, as you may recall from an earlier Kronos thread. The team was not aware of the issue until the user posted that thread, AFAIK. JRO heard after I did, around the time Nef cancelled the Kronos IPO and the rest of that shitstorm was going -- I remember because I told JRO both those news items on the same morning phone call. The hack's not really the issue here, though, and I'm not taking a side against Alberto necessarily. Keep in mind, JRO didn't lose money from the hack, however. What really set the projects back, first off, was cash-mixing between ventures, and that allowed something much worse to happen, but that's pretty personal, and up to JRO as to whether or not he wants to release that.

I don't see much point in me getting involved, and suggest non-cynics refrain from getting too riled up as it may be more detrimental than helpful for those with money in, but of course feel free to do as you please.

[repentance]

There are a bunch of sockpuppets on reddit accusing BDT of being the thief responsible for the Kronos hack.  One previously promoted Yoon Yeonghwa's launch of posadoll.  Could MNW (a known sockpuppeter) be trying to sling mud on BDT?

http://www.reddit.com/r/Bitcoin/comments/yc6rf/we_demand_a_public_apology_from_uthezenpadguy/c5ua667

<conspiracy>
Is MNW responsible for the Kronos hack, and sees the BDT hack as an opportunity to shift the blame?
</conspiracy>

It is, of course, possible that the actions of more than one person are responsible for the set-back of various projects.  In fact, that's what people appear to be claiming - that Alberto is responsible for some stuff which shouldn't have happened and that JRO is responsible for other stuff which shouldn't have happened.