Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[JorgeStolfi]

Why is there so much tolerance to dishonesty in the bitcoin community?

Same as banks and governments then
[/quote]

Governments are usually bought or held hostage by banks, so their "tolerance" is understandable.

Common folk who get screwed by a bank will usually curse it and move to another bank.  But that does not seem to impress their acquaintances much, they will usually continue using that bank even after being told of the incident.

So, indeed, perhaps the problem is not specific to bitcoin exchanegs and their clients...

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[Arcas]

[JorgeStolfi]

Their trapped clients seem to think that Y, the amount of real BTC that MtGOX currently owns, is about 1/3 of X-6000.  Although that perception may change rapidly on faint echos of rumors.

This is ridiculous. How would Gox have only 1/3 of their obligations? Did 2/3 of the total Bitcoins on the exchange get stolen?

Keep in mind, this is a profitable exchange. It seems silly to suggest, without a large-scale theft or other compelling event, that they are so badly insolvent. There were some asset seizures in the past, but that comes nowhere near 2/3 of their deposits - in fact I am fairly certain those few millions have long since been made up by trading fees.

Further: If Gox had been stolen from so dramatically, wouldn't the evidence be in the blockchain? I'm sure someone would have noticed a huge spike in withdrawals.

Er, that 2/3 (now more like 1/2) is not my estimate, it is what their clients apparently believe, given the price that they agreed at MtGOX.

Well, I can think of three ways in which MtGOX could have lost a large part of their coins (and theft is not one of them).  But there may be others.

"Too big to fail" has been said of many companies which failed soon after.  

The reason I suspect that MtGOX is insolvent is because Mark is doing everything that one expects from the CEO of an insolvent company: stalling and delaying payments, communicating only through vague press releases widely spaced  apart, avoiding clients, blaming "the system", moving to a high-security building...

And he is not doing any of the things that he should and could do if MtGOX were not insolvent and he cared about its business and the health of bitcoin. Like, proving that he controls a large stash of coins, giving explicit numbers (even if approximate) about their financial situation, bringing in some competent accountants and programmers, giving interviews about the crisis, checking and processing by hand some large withdrawals...

If MtGOX is not insolvent, Mark is feigning it extraordinarily well.

In any case, wasn't Bitstamp a target as well until recently? Why is nobody concerned about their solvency?

Good question.  Perhaps because few people heard about it, and there was no follow-up?

EDIT:markup
 

[gibbtek]

https://i.imgur.com/KtX5bYBs.png

http://imgs.xkcd.com/comics/extrapolating.png

lol

[surfer43]

The recent price rise at Gox just screwed me majorly.

+1  

[Holliday]

The recent price rise at Gox just screwed me majorly.

+1  

So you've both sold goxcoins for less than $200?

[NewLiberty]

The mtgox problem isn't solvency, so much as it is competency.

[Vycid]

Their trapped clients seem to think that Y, the amount of real BTC that MtGOX currently owns, is about 1/3 of X-6000.  Although that perception may change rapidly on faint echos of rumors.

This is ridiculous. How would Gox have only 1/3 of their obligations? Did 2/3 of the total Bitcoins on the exchange get stolen?

Keep in mind, this is a profitable exchange. It seems silly to suggest, without a large-scale theft or other compelling event, that they are so badly insolvent. There were some asset seizures in the past, but that comes nowhere near 2/3 of their deposits - in fact I am fairly certain those few millions have long since been made up by trading fees.

Further: If Gox had been stolen from so dramatically, wouldn't the evidence be in the blockchain? I'm sure someone would have noticed a huge spike in withdrawals.

Er, that 2/3 (now more like 1/2) is not my estimate, it is what their clients apparently believe, given the price that they agreed at MtGOX.

That's not a reasonable conclusion, for four reasons (assuming Gox is insolvent):

1) There is always a discount on debt, even if the ability to repay is certain. Otherwise T-bills would have nearly 0 yield. People do not like the idea that they may not see their money for months - even years, if they go bankrupt.

2) There is the expectation that a court may give preference to fiat debt in bankruptcy proceedings, and so BTC would be a junior debt class.

3) If the receiver liquidates Gox's BTC holdings to fiat, and BTC/USD increases during the bankruptcy proceedings, Gox could become more insolvent.

4) Fear is running this market.

[billyjoeallen]

Can someone explain again the dynamics how the price of goxcoin has an exact reflection on the price of bitstamp on a minute to minute basis? I know that the (possible) reenabling of withdrawals on mtgox has implications for each price but the implications should be somewhat different and have a different type of effect on the price a short term basis. They are trading in two different segregated environments with completely different forces and the fluctuations should at least be different.

There's about a 2 minute lag. Pretty damn profitable for me today! Not too hard to figure out. Goxcoin price is about solvency probabilities. The worry of dumping goxcoin in arbitrage has been dampened by bitcoinbuilder. Market is saying Gox is still shitty but more likely solvent.

[Arcas]

The mtgox problem isn't solvency, so much as it is competency.

Exactly. MtGox is either criminal, or extraordinarily incompetent.


Past history points towards the latter.

[Holliday]

The mtgox problem isn't solvency, so much as it is competency.

Exactly. MtGox is either criminal, or extraordinarily incompetent.


Past history points towards the latter.

At some point extraordinary incompetence becomes criminal.

Edit: Although anyone using Gox in the future is also a moron.

[BTC5OOO]

The mtgox problem isn't solvency, so much as it is competency.

mtgox is offtopic! ;-) LOL

[jojo69]

The reason I suspect that MtGOX is insolvent is because Mark is doing everything that one expects from the CEO of an insolvent company: stalling and delaying payments, communicating only through vague press releases widely spaced  apart, avoiding clients, blaming "the system", moving to a high-security building...

And he is not doing any of the things that he should and could do if MtGOX were not insolvent and he cared about its business and the health of bitcoin. Like, proving that he controls a large stash of coins, giving explicit numbers (even if approximate) about their financial situation, bringing in some competent accountants and programmers, giving interviews about the crisis, checking and processing by hand some large withdrawals...

If MtGOX is not insolvent, Mark is feigning it extraordinarily well.

The problem here is that the GOX team have ALWAYS behaved in this way, even when they were the only game in town and wildly successful.

I am not saying they are solvent, just that they have displayed staggering incompetence right along so the fact that they continue to tells me nothing.

[Vycid]

The mtgox problem isn't solvency, so much as it is competency.

Exactly. MtGox is either criminal, or extraordinarily incompetent.


Past history points towards the latter.

Remember the form Mark filled out where he said Gox isn't a money services business?

[KeyserSoze]

Ukrainian government has fallen. President has fled.  

Fled to Kharkiv.  East Ukraine vs. West Ukraine split perhaps?

Yep, he fled off to area where prorussians are majority. That's far from over yet, I'm afraid, specially if Russia gets involved.

I think the important question is, How can we profit from this?

I'd like to announce my new web site: Fleeing-Ex-Leader-Tracking.info. It uses Bitcoin only. Members are provided news and info as I track fleeing ex-leaders. Simple really. Whether its Viktor F. Yanukovych, Francisco Flores or General Pervez Musharraf you'll never need to worry about where your favorite ex-leader might have gone. This month only: 10% off!

[ChartBuddy]

Explanation

[hdbuck]

some of those charts are way scarier than gox lately

-> http://www.zerohedge.com/news/2014-02-22/just-12-wtf-charts

bonus from the article:

SPX vs The Federal Reserve Balance Sheet - The Truth

[billyjoeallen]

some of those charts are way scarier than gox lately

-> http://www.zerohedge.com/news/2014-02-22/just-12-wtf-charts

bonus from the article:

SPX vs The Federal Reserve Balance Sheet - The Truth

I saw that and I was thinking the same thing. The "All in?" article also on ZH suggests Yellen and Co are probably gonna untaper despite their jawboning. Bullish for BTC and PMs. Bullish for debtors. Nobody is buying Janet's Volker impersonation.

[hdbuck]

I'm feeling pretty bullish in the short term right now.

week end bullish?  

edit: discl: i've been shotring every mondays and buying back every thursdays/fridays for that last month and it surely had been freaking awesome

[HairyMaclairy]

Having witnessed apparent insider trading on Gox this last week the broader market is watching for further price signals hence the tie between stamp and Gox.