Is Lulzsec partly to blame for the bitcoin crash?

[vuce]

MtGox doesn't let you take out more than $1000 a day or $10000 a month. So 1 guy made himself look like a ton of guys who rushed to sell. Bundle that up with trolls spamming forums with SELL SELL SELL.

Is that what it was?

I'm certain those blocks of 50 coins were mined, and this transaction was one of the early adopters transfering his bankroll to mtgox (there is no limit for deposits, afaik?).

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[gigitrix]

Or, you know, could just be a market correction due a rapid and unsustainable growth, exacerbated by those who wish to exploit it for personal gain?

So what you're saying is that it was, infact, a bubble?

I'm saying the calls of "bubble bursting" are having an inverted bubble effect, and when it "bursts" we'll start to move back towards the same growth trends we've seen before. Look at this:



For a healthy dose on perspective.

[riX]

There's a limit fow withdrawing 1000 usd and the equivalent amount of bitcoins..

Some of those transactions of 50 btc originated from generation blocks. Unless mtgox is mining that block probably didn't have anything to do with mtgox withdrawal, just some pool or solo miner moving bitcoins around.

Also, if they had come from mtgox, they obviously would have come from _buying_ bitcoins, not selling them off.

[Basiley]

did anyone heard about LulzSec week before ?
i mean, how do you sure, they are not feds undercover ?
or exist at all ?

[hoo2jalu]

...
I'm certain those blocks of 50 coins were mined, and this transaction was one of the early adopters transfering his bankroll to mtgox.

You don't know how long these were sitting in a dark pool or other reserve before changing hands to someone who actually "withdrew" them from the dark pool / exchanger.

[silversurfer]

There's a limit fow withdrawing 1000 usd and the equivalent amount of bitcoins..

Not so sure about the 'equivalent amount of bitcoins' part...  I think you can withdraw any amount of bitcoins from mtgox, no?

[vuce]

...
I'm certain those blocks of 50 coins were mined, and this transaction was one of the early adopters transfering his bankroll to mtgox.

You don't know how long these were sitting in a dark pool or other reserve before changing hands to someone who actually "withdrew" them from the dark pool / exchanger.

I don't understand what you're trying to say. Once funds are on mtgox there wouldn't be a transaction like that.

[xf2_org]

You don't get how cashing out 50x340 bitcoins at once in 50 accounts to bypass transaction account limits to withdraw 340,000 dollars at once and more other the next few days could possibly crash the bitcoin market?

Ok, newbies, calm down.

Deep breath.

Those coins in the LulzSec tweet have not been spent (ie. not sent to mtgox etc.).  The coins have not been sold, therefore those sales did not crash the market.

Either they are taking credit for someone else's coin transfer, or they hacked into a miner and stole their wallet.

[enmaku]

So with the current status of bitcoin being a relatively small market with only one real exchange having any reasonable levels of adoption, is it possible for someone with sufficient bankroll in both USD/BTC to sell low to themselves on separate account with sufficient volume (esp. on the weekend) to actually cause a major drop in price? You'd lose a bit of cash to people with already-existing lowball bids but if you knew that the cause of the depression was artificial, you could buy quite low and then hold until the market rebounded, perhaps to repeat the process again?

Is there any defense at present against such an attack? Do we need to be just as worried about those controlling substantial portions of the market volume as we are concerned with deepbit's potential 51% issue? If this works, wouldn't the opposite work too? Liquidate a large portion of your BTC to yourself at grossly inflated prices to drive market value up then sell to legitimate investors at the peak?

[Man From The Future]

Or, you know, could just be a market correction due a rapid and unsustainable growth, exacerbated by those who wish to exploit it for personal gain?

So what you're saying is that it was, infact, a bubble?

Now we're going to end up with a comic...

[enmaku]

So with the current status of bitcoin being a relatively small market with only one real exchange having any reasonable levels of adoption, is it possible for someone with sufficient bankroll in both USD/BTC to sell low to themselves on separate account with sufficient volume (esp. on the weekend) to actually cause a major drop in price? You'd lose a bit of cash to people with already-existing lowball bids but if you knew that the cause of the depression was artificial, you could buy quite low and then hold until the market rebounded, perhaps to repeat the process again?

Is there any defense at present against such an attack? Do we need to be just as worried about those controlling substantial portions of the market volume as we are concerned with deepbit's potential 51% issue? If this works, wouldn't the opposite work too? Liquidate a large portion of your BTC to yourself at grossly inflated prices to drive market value up then sell to legitimate investors at the peak?

Which is not to say that this is what happened, but the fact that some seem to think it could be makes me wonder if it's possible. If so, shouldn't we be coming up with some method of defending against it?

[vuce]

Those coins in the LulzSec tweet have not been spent (ie. not sent to mtgox etc.).

ah, yes. How stupid of me to miss that 

[Dansker]

You don't get how cashing out 50x340 bitcoins at once in 50 accounts to bypass transaction account limits to withdraw 340,000 dollars at once and more other the next few days could possibly crash the bitcoin market?

Ok, newbies, calm down.

Deep breath.

Those coins in the LulzSec tweet have not been spent (ie. not sent to mtgox etc.).  The coins have not been sold, therefore those sales did not crash the market.

Either they are taking credit for someone else's coin transfer, or they hacked into a miner and stole their wallet.

First post making sense!

[hoo2jalu]

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I don't understand what you're trying to say. Once funds are on mtgox there wouldn't be a transaction like that.

You sell coins to precipitate a drop. You buy more back at bottom after inciting excess liquidity. You export your winnings across all accounts - meaning large withdraw from dark pool. Thus many old legitimate coins from virgin blocks into a single booty account outside exchanger(s).

LulzSec got the booty! (watch it rise to new highs over coming week, especially with difficulty hitting new high...)

[onesalt]

did anyone heard about LulzSec week before ?
i mean, how do you sure, they are not feds undercover ?
or exist at all ?

It's rampant tinfoil hat paranoia about how the government is apparantly out to get you which results in stupid shit like this occuring you know, all it does is make supporters of bitcoin look like anti-establishment anarchist nutjobs.

[riX]

You sell coins to precipitate a drop. You buy more back at bottom after inciting excess liquidity. You export your winnings across all accounts - meaning large withdraw from dark pool. Thus many old legitimate coins from virgin blocks into a single booty account outside exchanger(s).

LulzSec got the booty! (watch it rise to new highs over coming week, especially with difficulty hitting new high...)

Yeah, probably, so why don't everyone with more than a few k of bitcoins do that all the time? Morals?

You also have to learn more about dark pools and how mtgox works.

Most likely the transactions lulzsec linked to has nothing to do with them at all.

[hoo2jalu]

...
Yeah, probably, so why don't everyone with more than a few k of bitcoins do that all the time? Morals?

You have to automate all the code to exchange and cash out, and use many endpoints while remaining anonymous (enough) to bypass volume restrictions at exchangers and simulate enough activity to be effective manipulating the market.

[Basiley]

did anyone heard about LulzSec week before ?
i mean, how do you sure, they are not feds undercover ?
or exist at all ?

It's rampant tinfoil hat paranoia about how the government is apparantly out to get you which results in stupid shit like this occuring you know, all it does is make supporters of bitcoin look like anti-establishment anarchist nutjobs.

fueling other people "paranoia", by such obscure talks, instead of answering something context/subj-relevant isn't help you become/stay informative/interesting/meaningful/trusted.

[EconomicOracle]

Your username is so incorrect it's leaving me screaming and tearing up in my room ARGH
Bitcoin has been alive and living for MONTH! It is not dying. It cannot crash or be killed. The government cannot touch it so it is invincible. Why can't you understand this! It's as real as you and me. If you do not believe in BTC then you are POND SCUM!

[enmaku]

Or, you know, could just be a market correction due a rapid and unsustainable growth, exacerbated by those who wish to exploit it for personal gain?

So what you're saying is that it was, infact, a bubble?

The word bubble is politically incorrect on the Bitcoin.org forums. So yes, it was a bubble.

It's only politically incorrect here because there are a lot of room-temperature-IQ speculators who don't seem to comprehend that "a bubble" is not the same as "THE bubble" - bubbles happen in other markets all the time, but because those of us who aren't day traders don't hear about bubbles unless they destroy a market we assume the worst when we hear the term. It seems that what occurred recently was, in fact, a bubble but that doesn't necessarily mean it's THE bubble that everyone fears will kill the market.

People need to understand that bitcoin isn't really any different than any other commodity. Commodities have only the value we ascribe to them. We are trading so many post-scarcity products (music, movies, pornography) at such ludicrous markups daily that it occurs to me that it should be OBVIOUS that so much in this world has only the value we ascribe to things with no inherent value.

Bitcoin bubble theorists need to both learn some basic economics and perhaps the actual definition of the economic phrase "bubble": "trade in high volumes at prices that are considerably at variance with intrinsic values"

In other words, a bubble occurs any time people are regularly paying considerably more for something than it is worth intrinsically, such as gold which has some industrial value but not so much as to merit its current lofty prices. Trade of gold as a "store of value" has increased its value purely via speculation and so it too is a "bubble" at present. Realistically it's just another rock we pull out of the ground that has some special properties (chemically inert, electrically conductive, etc.) which make it better for some tasks than other rocks.