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

[JayJuanGee]

its really TO BAD, that bitgo didnt have some stupid logic saying if bitfinex asks for >1000Coins to be moved reject it.

It seems like a very obvious thing to do. Suspicious activity should trigger a lockdown and require manual intervention to OK it. The system shouldn't just go "yeah, no problem" when somebody asks to empty out half the Bitcoin vault.

Probably most of us here are novices, and even we can think of various solutions that would put checks on these kinds of likely attacks...

I personally believe manual /human intervention should have been triggered for smaller transactions....

So for example, any time that 50 coins or more is requested to be moved from one account at once or anytime that an accumulation of 1000 coins are requested to be moved in less than 30 minutes... maybe not exactly those triggering levels, but some level that is both manageable and safeguarding.  

[LogHangingConsortium]

BitGo and BitFinex are both very keen to point out that none of the blame lies with BitGo. Finex apparently had a custom setup with BitGo, unlike any other BitGo customer. [...]
Perhaps there is something else going on and I haven't read about it or it isn't public knowledge?

Jeesh, for people who seem to value outside-the-box thinking, you guys are thinking smack-dab inside the box.
BitGo implementation was used so that BFX could continue p2p lending (needed for leverage trading), without having to commingle the customer funds in a wallet it controlled (reason for the CFTC fine they paid).

So BitGo did exactly what was asked of it, allowing BFX to keep doing what it was already doing, without the need to become a licensed futures exchange.

I don't see how separating wallets by individual depositor requires ignoring proven security methods. Are you suggesting that security and appeasing the CFTC are mutually exclusive?

"Leverage is a loan that is provided to an investor by the broker that is handling his or her forex account. When an investor decides to invest in the forex market, he or she must first open up a margin account with a broker."

Bitfinex needs to be [a de facto] broker, without having the corresponding license. This is made possible by having p2p lending, but without the central (cold) wallet under BFX control like the good old times (because CFTC). Problem: neither Investor Bob, nor Lenders Alice [through] Zack, are a licensed broker. And yet the full amount of this "p2p loan" must be readily accessible by BFX (to enter and close positions).
Wat do? (This needs to happen in real time, not "in a bit, once we had time to run it past the suits upstairs" because real time trade engine.)

Read more: How does leverage work in the forex market? | Investopedia http://www.investopedia.com/ask/answers/06/forexleverage.asp#ixzz4Gfag38YP
Follow us: Investopedia on Facebook

P.S. " proven security methods" for this sort of thing involve third party security audits (which BFX refused), and a license (so don't have to exploit insecure but technically compliant 2-of-3 implementation).

[Elwar]

I'm ok with the idea of only losing 36% with the alternative being losing everything as they go bankrupt with the chance to get maybe 1-2% back after a long lawsuit and fight to get anything.

They say we'll get BitFinex "tokens" which will be turned into shares of BitFinex stock...but the key here is the way these are issued. If tokens are not fixed to a percentage of the company that represents the current value of the loss then they can just print tokens like dollars and the value of each token would go away quickly.

If, instead, it is a fixed percentage of BitFinex as the value of the company then I'm ok with that. I'd only lose about 10 bitcoins that are converted to shares in a major Bitcoin exchange which could do well in the future.

I'm in this for the long term so risking 10 bitcoins for exclusive access to owning shares of BitFinex is fine with me. It won't break me and I can hope that over the long term it does well.

[LogHangingConsortium]

I'm ok with the idea of only losing 36% with the alternative being losing everything as they go bankrupt with the chance to get maybe 1-2% back after a long lawsuit and fight to get anything.

Promise of 64% of your money back is not the same as 64% of your money back. Count your blessings if you get anything back. The money BFX is spreading around is not theirs to spread. It's their client's money. This seems like a a legal quagmire.

They say we'll get BitFinex "tokens" which will be turned into shares of BitFinex stock...

Why didn't GOx thik of that, amirite? Those tokens are meaningless. BFX is not a public company, it can't legally issue shares (or tokens, or thigamabobs). It's also bankrupt. The SEC will take them down/shut off their $$$ supply (legacy banks).

P.S. How are you liking your socialized losses? Though totally pointless question, not like you have a choice, you'll eat your strawberries and cream and like it, Comrade Elwar

[Holliday]

BitGo and BitFinex are both very keen to point out that none of the blame lies with BitGo. Finex apparently had a custom setup with BitGo, unlike any other BitGo customer. [...]
Perhaps there is something else going on and I haven't read about it or it isn't public knowledge?

Jeesh, for people who seem to value outside-the-box thinking, you guys are thinking smack-dab inside the box.
BitGo implementation was used so that BFX could continue p2p lending (needed for leverage trading), without having to commingle the customer funds in a wallet it controlled (reason for the CFTC fine they paid).

So BitGo did exactly what was asked of it, allowing BFX to keep doing what it was already doing, without the need to become a licensed futures exchange.

I don't see how separating wallets by individual depositor requires ignoring proven security methods. Are you suggesting that security and appeasing the CFTC are mutually exclusive?

"Leverage is a loan that is provided to an investor by the broker that is handling his or her forex account. When an investor decides to invest in the forex market, he or she must first open up a margin account with a broker."

Bitfinex needs to be [a de facto] broker, without having the corresponding license. This is made possible by having p2p lending, but without the central (cold) wallet under BFX control like the good old times (because CFTC). Problem: neither Investor Bob, nor Lenders Alice [through] Zack, are a licensed broker. And yet the full amount of this "p2p loan" must be readily accessible by BFX (to enter and close positions).
Wat do? (This needs to happen in real time, not "in a bit, once we had time to run it past the suits upstairs" because real time trade engine.)

Read more: How does leverage work in the forex market? | Investopedia http://www.investopedia.com/ask/answers/06/forexleverage.asp#ixzz4Gfag38YP
Follow us: Investopedia on Facebook

P.S. " proven security methods" for this sort of thing involve third party security audits (which BFX refused), and a license (so don't have to exploit insecure but technically compliant 2-of-3 implementation).

So you are telling me that Finex settled positions via the block chain with these segregated wallets? This doesn't jive with "readily accessible/real time" as confirmations on the block chain take time. If they didn't settle each position via the block chain, but internally or on paper, then why couldn't they use actual security for actual block chain transactions?

P.S. "Proven security methods" only require that they actually be implemented. Third party audits and licenses are only for verification and compliance.

[LogHangingConsortium]

...

So you are telling me that Finex settled positions via the block chain with these segregated wallets? This doesn't jive with "readily accessible/real time" as confirmations on the block chain take time. If they didn't settle each position via the block chain, but internally or on paper, then why couldn't they use actual security for actual block chain transactions?

While the numbers are tallied " internally or on paper," who actually holds the funds? Whose wallets?
How would you do it? Walk me through.

"Proven security methods" only require that they actually be implemented.

But there are no "proven security methods" for an unlicensed futures broker, they don't exist. That's why other exchanges don't offer the stuff that made BFX great. BFX "security measures" were a bluff that got called.

[savetherainforest]

Bail-In at bitfinex ...
http://www.zerohedge.com/news/2016-08-07/first-bitcoin-bail-all-bitfinex-users-lose-36-shared-loss-after-historic-hack

Bitfinex announced it would pull a page right out of Europe's bank resolution mechanism, saying that all of its users will lose 36% of their deposits after it concluded its review the massive hack, in what is set to be the first ever "bitcoin bail-in."

Name of the actor next to R.Kelly ? ... hmm?? (*Edit: nvm... found him... Eric Lane is his name.. )


Also the so called "bail in" ... did they also promised that 36% to be refunded in time back to the users? ... Or ... ? what?  ... I mean did they just went full commies on everyone's asses or they are just doing this temporarily and in time they will refund 1% every month or so? ... And what happens if that person removes the amount 64% that they still have in their account... will they be getting that 36% back in time even if their balance is 0$ / 0BTC ?

[BlindMayorBitcorn]

Those tokens are meaningless. BFX is not a public company, it can't legally issue shares (or tokens, or thingamabobs). It's also bankrupt. The SEC will take them down/shut off their $$$ supply (legacy banks).

But tokens  

[LogHangingConsortium]

^Getting dangerously close to altcoin discussion.

But back to the walls, any rumors on when BFX plans to refloat the Titanic restoke Chernobyl bring the site back online?  Heard something about Monday in zombie mode, should we start painting victory stripes yet?

P.S. watching huobi chart on bitcoinwisdom, look over to the other markets in the top bar, and "huh, finex is up to 604 already ... ? Doh!"

[adamstgBit]

Also the so called "bail in" ... did they also promised that 36% to be refunded in time back to the users? ... Or ... ? what?

bail-in means that you simply use ( take with or without  permission ) other customer deposits to make yourself solvent again.
this is what BFX will do, they will take  36% of all customer deposit from all accounts and assets in order to cover the missing 119K BTC.

are just doing this temporarily and in time they will refund 1% every month or so?

no this is a one time deal which will make BFX whole again. everyone losses 36% and thats all there is to it.

what happens if that person removes the amount 64%

they can't, they can't access their accounts right now, when they do access there account, they will find the BFX  settled all there margin positions and took 36% of their holdings.


i hope this makes it clear.

[adamstgBit]

^Getting dangerously close to altcoin discussion.

But back to the walls, any rumors on when BFX plans to refloat the Titanic restoke Chernobyl bring the site back online?  Heard something about Monday in zombie mode, should we start painting victory stripes yet?

P.S. watching huobi chart on bitcoinwisdom, look over to the other markets in the top bar, and "huh, finex is up to 604 already ... ? Doh!"

my guess is: "zombie mode" as early as monday, and back to full operation by friday.

provided things go smoothly and no one try to sue them or somthing.

[adamstgBit]

They say we'll get BitFinex "tokens" which will be turned into shares of BitFinex stock..

why do i keep hearing about "tokens" can someone point me to the source of this rumor.

We are actively discussing various strategic options with numerous potential investors as part of our strategy to fully compensate our customers. Such discussions, however, are in early stages and will likely take time to play out. In the meantime, In place of the loss in each wallet, we are crediting a token labeled BFX to record each customer’s discrete losses. Tokens will be distributed without release or waiver. The BFX tokens will remain outstanding until redeemed in full by Bitfinex or possibly exchanged—upon the creditor’s request and Bitfinex’s acceptance—for shares of iFinex Inc. We are still sorting out many details on this; we will post further updates in the coming days.

LOL i see

well thats really fucking cool on there part.

[BlindMayorBitcorn]

^

iFinex Inc.
There is no Key Executives data available.
There is no Board Members data available.
There is no committee data available.

[LogHangingConsortium]

^Getting dangerously close to altcoin discussion.

But back to the walls, any rumors on when BFX plans to refloat the Titanic restoke Chernobyl bring the site back online?  Heard something about Monday in zombie mode, should we start painting victory stripes yet?

P.S. watching huobi chart on bitcoinwisdom, look over to the other markets in the top bar, and "huh, finex is up to 604 already ... ? Doh!"

my guess is: "zombie mode" as early as monday, and back to full operation by friday.

provided things go smoothly and no one try to sue them or somthing.

Nothing stopping people from suing after they get their 64% out of that bad neighborhood.
If a mugger tells you he'll return half of your money if you promise not to go to the cops, whatever you tell the mugger won't be considered binding by the court.

Yeah, people will sue. 100% chance.

I'm still waiting for the other shoe to drop from the rep. I'm betting on something negative in a few days, to swing the price down. I would.

[UngratefulTony]

i hope this makes it clear.

They don't want to turn off their magic money making machine, that much is clear... they just aren't aware it's shattered, strewn across the shop floor, irreparably destroyed yet?

provided things go smoothly and no one try to sue them or somthing.

Can't imagine that happening... lol.

They say we'll get BitFinex "tokens" which will be turned into shares of BitFinex stock..

why do i keep hearing about "tokens" can someone point me to the source of this rumor.

We are actively discussing various strategic options with numerous potential investors as part of our strategy to fully compensate our customers. Such discussions, however, are in early stages and will likely take time to play out. In the meantime, In place of the loss in each wallet, we are crediting a token labeled BFX to record each customer’s discrete losses. Tokens will be distributed without release or waiver. The BFX tokens will remain outstanding until redeemed in full by Bitfinex or possibly exchanged—upon the creditor’s request and Bitfinex’s acceptance—for shares of iFinex Inc. We are still sorting out many details on this; we will post further updates in the coming days.

LOL i see

well thats really fucking cool on there part.

1) Facilitate or participate in the loss of near 40% of your clients' money.

2) Shrewd clients say "it isn't that bad, could be worse", "hopefully they'll start trading again soon."

3) Clients light up with glee when bankrupt organization floats pie in the sky idea of illegally offering non-enforceable equity to non-accredited investors (many/most of US domicile) in said bankrupt organization in lieu of rube's money.

[Just Bitcoiner Things.]

[adamstgBit]

^Getting dangerously close to altcoin discussion.

But back to the walls, any rumors on when BFX plans to refloat the Titanic restoke Chernobyl bring the site back online?  Heard something about Monday in zombie mode, should we start painting victory stripes yet?

P.S. watching huobi chart on bitcoinwisdom, look over to the other markets in the top bar, and "huh, finex is up to 604 already ... ? Doh!"

my guess is: "zombie mode" as early as monday, and back to full operation by friday.

provided things go smoothly and no one try to sue them or somthing.

Nothing stopping people from suing after they get their 64% out of that bad neighborhood.
If a mugger tells you he'll return half of your money if you promise not to go to the cops, whatever you tell the mugger won't be considered binding by the court.

Yeah, people will sue. 100% chance.

I'm still waiting for the other shoe to drop from the rep. I'm betting on something negative in a few days, to swing the price down. I would.

i've explained this 100X
suing bitfinex will get you a far worse deal then they are offering.
i didnt even know about the tokens and i thought it was still a better option to go along with their bail in rather then suing them
if you hate bitfinex, when they open again withdraw all your coins, and wait to sell your tokens.
I however might be buying the tokens.
bitfinex fucked up, sure, but IMO they are handling this exceptionally well. with a  better security model, and some time, i now believe they can once again be #1 BTC/USD exchange.
the MTGOX explosion and Bitfinex are as different as night and day.
i am impressed with their swift and fair actions.

[adamstgBit]

i hope this makes it clear.

They don't want to turn off their magic money making machine, that much is clear... they just aren't aware it's shattered, strewn across the shop floor, irreparably destroyed yet?

provided things go smoothly and no one try to sue them or somthing.

Can't imagine that happening... lol.

They say we'll get BitFinex "tokens" which will be turned into shares of BitFinex stock..

why do i keep hearing about "tokens" can someone point me to the source of this rumor.

We are actively discussing various strategic options with numerous potential investors as part of our strategy to fully compensate our customers. Such discussions, however, are in early stages and will likely take time to play out. In the meantime, In place of the loss in each wallet, we are crediting a token labeled BFX to record each customer’s discrete losses. Tokens will be distributed without release or waiver. The BFX tokens will remain outstanding until redeemed in full by Bitfinex or possibly exchanged—upon the creditor’s request and Bitfinex’s acceptance—for shares of iFinex Inc. We are still sorting out many details on this; we will post further updates in the coming days.

LOL i see

well thats really fucking cool on there part.

1) Facilitate or participate in the loss of near 40% of your clients' money.

2) Shrewd clients say "it isn't that bad, could be worse", "hopefully they'll start trading again soon."

3) Clients light up with glee when bankrupt organization floats pie in the sky idea of illegally offering non-enforceable equity to non-accredited investors (many/most of US domicile) in said bankrupt organization in lieu of rube's money.

[Just Bitcoiner Things.]

being NLC all you can focus on is their fuck up.
nothing they do will change your mind about them
"
they are evil poeple looking to steal your money.
much like a mugger.
bla bla bla
bitcoiners are stupid
bla bla bla
"

GTFO of here man.

[UngratefulTony]

GTFO of here man.

I wouldn't miss this for the world. A real world, real time, case study in stockholm syndrome.

It sucks, but a bankruptcy court is the only way these jagoffs aren't going to be laughing their asses off at you as they "socialize" their mistakes onto you without oversight.

I'm sorry you lost money, at least try to save some of your dignity by not giving these assholes a pass.  

not lambie btw, at least not the real one.

Director Tuckett (not) answering some questions:

https://www.youtube.com/watch?v=DUpfGRDN4IY

[JayJuanGee]

But back to the walls, any rumors on when BFX plans to refloat the Titanic restoke Chernobyl bring the site back online?  Heard something about Monday in zombie mode, should we start painting victory stripes yet?

Even though you are coming off as a fucking goofball troll, this seems to be a quasi-relevant question.

The latest BFX notice, which was issued a bit over 24 hours ago, had said that they were planning to come back online in a limited capacity in the next 24-48 hours.  So, yeah, we are within the window period in which they could come back online, but yeah, none of this is set in stone, especially if they potentially were to run into some SNAFUs on their end that could cause additional delays.

No, I am not taking their side on anything, but to the extent that this problem could actually be real (and not created by Bitfinex themselves), it is definitely reasonable that sorting it out could take a considerable amount of time and a considerable amount of weighing their options, including their public communications of such decisions, once made.  Also, surely some of the earlier communications and notifications can serve as test balloons in weigh various aspects of public reaction and the extent to which the public may know things that have not been made public.

I suspect that once Bitfinex goes on line, it may take several days, and maybe even a week before they actually resume trading.  In this regard, the extent to which their going on line could cause additional discussion, surprises or curve balls in their determination whether to actually go live with their currently proposed path forward.

[savetherainforest]

what happens if that person removes the amount 64%

they can't, they can't access their accounts right now, when they do access there account, they will find the BFX  settled all there margin positions and took 36% of their holdings.


i hope this makes it clear.

Nope... it does not make it clear ...

The thing is ... when do they get back those 36% of their money/coins back? ... And I'm not asking when... but if they will get that full 36% back! Like full restitution!!! + % interest!

Because in the end... their entity was proprietary of the coins thieved... and basically in the future they would have legal ownership over the parent address codes that where stolen.


*This is pure theoretical: And keeping that in mind... A tactical missile can be literally bought and executed on a target for less than 10.000$ .. that is less than 20BTC at the current rate. And now depending if that missile is a small nuke warhead with a mediocre 5% enriched radioactive material or just something simple like C4 payload. And after hearing this, do they really actually think that taking 36% and never giving that percentage back is a good idea? .. I mean, Hong Kong where they have their server in the crystal palace skyscraper, or the owners and employees at their homes where they live... Do you think they will get away without retaliation? And all this from an all theoretical perspective of someone who does not own anything in the Finex exchange... What do you think it will happen when the ones that actually own the power of a few millions will/can do?

*The proper response of Finix is: We are on our knees, in front of you! We are your slaves, and we will take it in!.. as hard as you will give it to us! Till we will pay you back that 36% confiscated from you.

And a more proper way to bail in with that 36% is to restore everything as it was before the hack to everyone, fiat or bitcoin, but not allow for those 36% to be removed from the exchange. Basically you can gamble as it was before, but 36% of the settled initial amount will be compromised and kept hostage on the trading table.