So Cryptsy's CEO predicted this would happen.

[commandrix]

According to a Florida divorce court, anyhow. What I'd like to know is how he thought Cryptsy members wouldn't be ticked... http://www.coindesk.com/court-cryptsy-ceo-predicted-exchange-failure/

[BellaBitBit]

According to a Florida divorce court, anyhow. What I'd like to know is how he thought Cryptsy members wouldn't be ticked... http://www.coindesk.com/court-cryptsy-ceo-predicted-exchange-failure/

Yikes - Cryptsy funds diverted to purchase 1.4million property in Florida.  So what happens next?  Is there a class action lawsuit with Cryptsy members?

He also claimed that it would dissolve due to "economic conditions" - I am not understanding what he is talking about, isn't this just poor bookkeeping?

[aardvark15]

There is in fact a class action lawsuit filed in Florida against Paul Vernon and Cryptsy.  I was told by one of the lawyers not to expect to get much from it because the money is probably mostly all gone (and the lawyers get a huge chunk of what's left).

[Chronikka]

According to a Florida divorce court, anyhow. What I'd like to know is how he thought Cryptsy members wouldn't be ticked... http://www.coindesk.com/court-cryptsy-ceo-predicted-exchange-failure/

Yikes - Cryptsy funds diverted to purchase 1.4million property in Florida.  So what happens next?  Is there a class action lawsuit with Cryptsy members?

He also claimed that it would dissolve due to "economic conditions" - I am not understanding what he is talking about, isn't this just poor bookkeeping?

What happens next is the lawsuit against Cryptsy has been updated to include the estranged wife of Paul Vernon. IMO this is good for Cryptsy customers, really bad for the wife.

Its stated in the divorce filings that the majority of marital assets were held in crypto currencies, which are essentially out of control of the divorce court because Vernon has fled to China. But because the wife was also a beneficiary of the 1.4 million dollar home purchased with customer funds, they believe she's liable. It means the lawsuit might be able to recoup some additional money, but I wouldn't hold my breath.

It sure seems to me that Paul Vernon had been planning this for some time. Scumbag.

[clickerz]

I see, so its mismanagement and greed? With relationship problem with his wife,and finally lead divorced his finances was affected that lead to devastation.What about this hacking incident (in cryptsy),its just a diversion?

[amacar2]

There is in fact a class action lawsuit filed in Florida against Paul Vernon and Cryptsy.  I was told by one of the lawyers not to expect to get much from it because the money is probably mostly all gone (and the lawyers get a huge chunk of what's left).

yes there is no reason to hope to get lost coin back from cryptsy. 

[SFR10]

What a selfish move by nettles and vernon. They used cryptsy's customers funds for their personal expenses. Vernon knew it was going to fail at some point but again didn't do anything to improve the situation. And now, after being too late to act upon the failure, they don't seem to give back people money  (wow, there's no words that describes them). KARMA will happen.

[Kprawn]

One thing is sure, when the money goes, the spouse goes too. {80% of the time} His wife has seen this coming for a long time, and she is going to lose that house as part of the settlement to the

money owed to the members of the class action. The divorce court will have to settle any debt acquired first, before paying out any money owed. While he is banging Chinese girls in China and paying

in Bitcoin, his ex-wife is left behind to pick up the pieces.  

[Chronikka]

I see, so its mismanagement and greed? With relationship problem with his wife,and finally lead divorced his finances was affected that lead to devastation.What about this hacking incident (in cryptsy),its just a diversion?

I think its possible the "hack" was just a diversion. An excuse for why they were shutting down and why they had no money to return to customers (which was of course a lie. The wife has stated rather clearly in divorce proceedings that Vernon holds a significant amount in Crypto. This is almost certainly the Cryptsy funds). Vernon mentioned specifically in the divorce proceedings that income for the company had dried up weeks before any of the Cryptsy customers were notified, and that he expected the company to shut its doors. He even mentions he had no salary. The part about "economic conditions" I think was just to give the court an excuse.

What I think happened was Vernon knew his wife would go after everything non crypto because the court would really have no way to get Vernon to give up his crypto holdings. So he made claims that the company was failing and had no income, and therefore had nothing to offer. Which it was actually failing, except that he conveniently left the reasons out, instead stating "economic conditions" as the cause.

Personally I think this is a test of the American judicial system. Those holdings that are being fought over in court do not belong to either Vernon or his wife. They belong to Cryptsy customers. The fact that they're even allowed to have discussions about who gets assets that likely don't belong to either of them boggles my mind.

[magemist]

I say just wow
I hate exchanges. You give them your coins & they go out buying a house then running away with investor's coins. Seems like their typical script.

[Snorek]

I say just wow
I hate exchanges. You give them your coins & they go out buying a house then running away with investor's coins. Seems like their typical script.

It is better to use good&reputable exchange with long traditions that trying to find a deals and trade bitcoin on your own imo.
It is true that we have some major exchange flops in the past with the Mt.Gox failure at the top of the list. But it all could have been avoided.

If you are so paranoid about exchanges why don't you try https://gemini.com/ I doubt that they will ever have problems with stability.

[hdbuck]

yea he knew he was going to exit scam at some point, taking y'all precious bitcoins for posterity.

people using centralized exchanges, with not even a company being registered, are getting exactly what they deserve.

[franky1]

just to note anyone filing against "cryptsy" (only) under the pretense that its fincen registered, wont get very far. you need to file against
"project investors trading as cryptsy".
getting both names into the lawsuit. as it is the umbrella company 'project investors' that has the fincen registration.

EG Apple Inc. can easily declare itunes bankrupt, and close down itunes. while still running and profiting from apples retail and products business.
so just for instance going after Itunes, will make you only a creditor of the bankruptsy case. rather than something stronger against apple themselves

this is because "cryptsy" can file standard bankruptcy and leave the sheep to the wolves, where customers are fighting to their death just for a small chance of a small return.

but going after project investors means that the government get involved and penalize the wolves. which is more ammo to shoot at the wolves.
(hopefully the 1.4million dollar house gets taken, in the process)

so might be worth checking with your lawyers what they are going after, is it a proper lawsuit against a fincen registered company. or is it just wasting legal costs to be legally recognised as one of 'cryptsy' creditors in the bankruptcy that can take years for a small chance of pennies

P.S read my footer

[jchst]

Soo this is another exchange going down?Well i tryed it in the past and didnt liked it soo i hope all who were there can recover their funds otherwise we will see another bad experience related to bitcoin affecting thousands.

[unamis76]

If this is true, then we can assume that either the hack is a lie or after being hacked, Cryptsy's MO changed a little bit. This makes "Big Vern" a con artist (beyond having been trusted with coins and "misplacing" them )

[iGotSpots]

A lot of us tried warning you guys for a LONG time.. Maybe you should stop listening to trolls and start listening to people with actual experience in the sector

[gentlemand]

The temptations to go nefarious must be incredibly strong when you're operating an exchange. Ultimately though it's a dim move. You can run now and fuck yourself for life or build a real business that might sell for way more than you steal. Unsurprising but still pathetic and loathsome especially to keep taking deposits when you know of the 'hack' for such a long time.

[franky1]

The temptations to go nefarious must be incredibly strong when you're operating an exchange. Ultimately though it's a dim move. You can run now and fuck yourself for life or build a real business that might sell for way more than you steal. Unsurprising but still pathetic and loathsome especially to keep taking deposits when you know of the 'hack' for such a long time.

well they were only doing a maximum of 3000 volume at a 0.2%buy 0.3% sell (0.5% trade fee=15btc a day)

if you have over 40,000 coins and knowing that only 10% moves in or out at a time then yes stealing anything from 25%-90% is tempting for those without morals.
as oppose to running the exchange at 15 a day which would take 2 years to make 10,000..

so those without morals would easily see that taking 25% (10,000) and hoping the trading fee's can recoup that deficit in time to go unnoticed.

but it seems they got greedy and now want to keep the majority of coins

[aardvark15]

just to note anyone filing against "cryptsy" (only) under the pretense that its fincen registered, wont get very far. you need to file against
"project investors trading as cryptsy".
getting both names into the lawsuit. as it is the umbrella company 'project investors' that has the fincen registration.

EG Apple Inc. can easily declare itunes bankrupt, and close down itunes. while still running and profiting from apples retail and products business.
so just for instance going after Itunes, will make you only a creditor of the bankruptsy case. rather than something stronger against apple themselves

this is because "cryptsy" can file standard bankruptcy and leave the sheep to the wolves, where customers are fighting to their death just for a small chance of a small return.

but going after project investors means that the government get involved and penalize the wolves. which is more ammo to shoot at the wolves.
(hopefully the 1.4million dollar house gets taken, in the process)

so might be worth checking with your lawyers what they are going after, is it a proper lawsuit against a fincen registered company. or is it just wasting legal costs to be legally recognised as one of 'cryptsy' creditors in the bankruptcy that can take years for a small chance of pennies

P.S read my footer

I think the lawsuit names Project Investors and Paul Vernon.  Regardless, they are not optimistic to recover much.

[Gleb Gamow]

The temptations to go nefarious must be incredibly strong when you're operating an exchange. Ultimately though it's a dim move. You can run now and fuck yourself for life or build a real business that might sell for way more than you steal. Unsurprising but still pathetic and loathsome especially to keep taking deposits when you know of the 'hack' for such a long time.

Paul Vernon and his team scammed marks since 1997 while he was supposedly in the Army sucking the dicks of 3-, 4- and 5-Star Generals in the Hood down in Texas. Paul Vernon jacked off over himself when he stumbled upon Bitcoin knowing in his mind that he and his team could reap millions, more that what he fucked over in the porn and penny auction sectors combined.