I'm Kevin, here's my side.

[Rodyland]

I would also like the bitcoin "loser" to step up

I'm Spartacus!  I mean, "the bitcoin loser".

[tymothy]

What's with so many people loving mtgox? they have "some responsibility" for writing crappy software, getting hacked via a dodgy auditor and getting the entire contents of the exchange sold off in 5 minutes? You're right, they do have the tiniest smidgeon of responsibility there...
[/quote

The person whose account was hacked (if it was one person) is entitled to their Bitcoins and it's MtGox's responsibility to provide that to him. Kevin did nothing wrong making a large purchase of bitcoins, but now that he KNOWs the bitcoins were stolen, he's possessing stolen property, which can be a felony. The fact that MtGox's account was hacked makes all the difference here, as it makes the bitcoins which were traded stolen property.

[chihlidog]

You people making the stolen property analogies are leaving out one critical factor. The middleman.

Let's say you go to a used car dealer, and you purchase a vehicle. Later it comes to light that the car was stolen. Would you then give the vehicle back? No. You wouldnt. The dealer would be responsible. Simple as that. The dealer would have to re-imburse either the original victim, or give the car back and re-coup the buyer. It doesnt matter what price the car was, if I bought it for 5 dollars, it was an agreement made with a professional organization who decided to get into the business of selling these things.

Your wrong. I know someone how bought a stolen vehicle and they lost all their money and the vehicle. The dealer closed it doors. What do you do now? Sue the person whos vehicle was stole to get your money back? You mean in a theft you would want your items back?

The dealer could be sued in civil court. Yes, not existing anymore presents a problem, however in this case Mt Gox is still around and should be reimbursing the original account.

[Phil21]

Alright.. so amdist all the wailing and gnashing of teeth I've yet to see anyone propose an actual solution to this problem, that is not outlandish and ridiculous (e.g. laywering up - no one wins here.)

So, I propose the following.  Full disclosure:  I personally know Kevin through mutual colleagues, and occassionally (2-3 times a year?) speak with him via AIM about various nerdy projects we're working on.  This is the extent of my personal relationship with him.  Oh, we at one point (5 years or so ago?) repaired a broken solenoid in a pinball machine together.


Kevin,

You say in your post that you are more concerned about the community and future growth of Bitcoin rather than your own pocketbook.  Many here obviously dispute this claim, and for good reason are unlikely to believe you.

Given this, would you agree to a panel of senior community members (chosen at large by the community as a whole) to become a panel for arbitration between yourself and MtGox?  Lets call it 5 senior well-respected members, who both MtGox, yourself, and the community can all trust.

Kevin will submit his story, which he pretty much already did it seems.  MtGox will tell their side, and provide confidential information needed to verify it to these 5 panel members.

These 5 members will decide the best course of action in relation to your specific situation with the following guidelines given to them:
* The primary consideration is what is best for the community as a whole
* Any solution will not bankrupt or otherwise substantially impact MtGox's operational capabilities

This would accomplish the following, based on your +/- system:
+ Gives the community some semblance of transparency for a MAJOR issue with the bitcoin market as a whole (as it exists today, at least)
+ Allows both sides to tell their story in relative confidence, thus protecting any major run on markets or mtgox due to new info being released that may be damaging.
+ Keeps this situation out of the court system, where it really has no business belonging and everyone is a loser
+ Quick resolution if MtGox agrees to this, I can't imagine it taking more than a few hours?
- Random panel of 5 "Internet Dudes" are deciding your fate
- You have a very substantial chance of being ordered to give back the BTC you withdrew, should the community members deem it appropriate

I believe this solution, with of course some tweaks to make both parties feel comfortable can accomplish everyone's *stated* goals here.  It will allow Kevin to know what happened, so he knows he's not being completely taken advantage of, it will allow the community to gain transparency and show to outsiders we can resolve problems in an expediant and reasonable manner.  Additionally MtGox will be able to end the rampant speculation as to their activities, and at least for me personally I'd regain a lot of confidence in their exchange.

Does someone have anything better?  Kevin, do you agree in principle to this?  MtGox?  Community feedback?

My personal goal is the longevity of Bitcoin.  Discussions with Kevin lead me to believe this is also his goal as well.  Is it MtGox's goal?  They have stated it is!  If so, step up!  If they do not, then I will have lost faith in their motives myself.  Others will make their own decisions.

[toasty]

The person whose account was hacked (if it was one person) is entitled to their Bitcoins and it's MtGox's responsibility to provide that to him. Kevin did nothing wrong making a large purchase of bitcoins, but now that he KNOWs the bitcoins were stolen, he's possessing stolen property, which can be a felony. The fact that MtGox's account was hacked makes all the difference here, as it makes the bitcoins which were traded stolen property.

Nobody here knows that's what happened though.

And there are many ways this could be interpreted in wholly different ways. One way could be, depending on what actually happened, is that MtGox's system sold me bitcoins that they didn't have a seller for, so they sold them to me themselves.

That's a bit of a stretch, but saying what happened here is positively "theft" when there's no evidence of any "theft" happening, and it's hard to say that even if what they say happened did happen, that it's actually theft or not.

[martin]

What's with so many people loving mtgox? they have "some responsibility" for writing crappy software, getting hacked via a dodgy auditor and getting the entire contents of the exchange sold off in 5 minutes? You're right, they do have the tiniest smidgeon of responsibility there...

The person whose account was hacked (if it was one person) is entitled to their Bitcoins and it's MtGox's responsibility to provide that to him. Kevin did nothing wrong making a large purchase of bitcoins, but now that he KNOWs the bitcoins were stolen, he's possessing stolen property, which can be a felony. The fact that MtGox's account was hacked makes all the difference here, as it makes the bitcoins which were traded stolen property.

If Kevin wanted, and as I'm sure a few other people have done, he could have purchased those coins, withdrawn every single one of them by exploiting the bug he identified, and then stayed quiet. Kevin, who is doing the right thing, will have 250k coins taken off him in the rollback, and would probably return those 600 coins if asked, other shadier people will have got away with some money, will stay quiet about it, and will get to keep it.

I think we're rewarding the wrong people here!

[wol-va-rine]

I actually agree with OP 100%. This is Mt. Gox's responsibility to make right. Especially in light of numerous complains regarding security well before the plummet. The fact is they were in over their heads and they dont know what to do now. Who are they to roll back a market?

THEY allowed their system to be compromised. They alone. I dont care if it was an auditor. That auditor had authorization to access their files and was acting on authority of the owner. No difference. I have zero pity for Mt. Gox. The only right thing to do is to reimburse the original owner for everything that he lost (since there arent enough bitcoins available, they need to BUY them for him. Period.) and the OP be allowed to retain the bitcoins fairly purchased. If I had money in Mt. Gox at the time, I would have been furiously trying to buy, too. There were plenty of posts here that thought it was a legitimate selloff. The OP did nothing wrong. Period.

they "allowed" it to happen...?

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

[chihlidog]

I actually agree with OP 100%. This is Mt. Gox's responsibility to make right. Especially in light of numerous complains regarding security well before the plummet. The fact is they were in over their heads and they dont know what to do now. Who are they to roll back a market?

THEY allowed their system to be compromised. They alone. I dont care if it was an auditor. That auditor had authorization to access their files and was acting on authority of the owner. No difference. I have zero pity for Mt. Gox. The only right thing to do is to reimburse the original owner for everything that he lost (since there arent enough bitcoins available, they need to BUY them for him. Period.) and the OP be allowed to retain the bitcoins fairly purchased. If I had money in Mt. Gox at the time, I would have been furiously trying to buy, too. There were plenty of posts here that thought it was a legitimate selloff. The OP did nothing wrong. Period.

they "allowed" it to happen...?

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

The original victim didnt leave his car running. He left it in a garage that is supposed to be secure.

[initiv]

I actually agree with OP 100%. This is Mt. Gox's responsibility to make right. Especially in light of numerous complains regarding security well before the plummet. The fact is they were in over their heads and they dont know what to do now. Who are they to roll back a market?

THEY allowed their system to be compromised. They alone. I dont care if it was an auditor. That auditor had authorization to access their files and was acting on authority of the owner. No difference. I have zero pity for Mt. Gox. The only right thing to do is to reimburse the original owner for everything that he lost (since there arent enough bitcoins available, they need to BUY them for him. Period.) and the OP be allowed to retain the bitcoins fairly purchased. If I had money in Mt. Gox at the time, I would have been furiously trying to buy, too. There were plenty of posts here that thought it was a legitimate selloff. The OP did nothing wrong. Period.

they "allowed" it to happen...?

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

The original victim didnt leave his car running. He left it in a garage that is supposed to be secure.

And the owner of the car was told that the garage wasn't secure but he didn't care, until this happened.

People who are making comparisons need to review the actual situation instead of making a straw man argument.

[toasty]

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

Analogies are wonderful because there are so many of them!

Me: "Hey, Ford... This new car I got from you... People are telling me that if they go to a ford dealer they can get new keys to my car made without any proof they actually own my car! I keep a lot of valuable stuff in there, I don't want it to get stolen."

Ford: "There is nothing to worry about, nobody can have new keys to your car made. If you want to have your locks changed, you can do so whenever you want. Your car is safe if it's locked."

Now my car gets stolen because someone did convince Ford to make a new key to my car. Aren't they partially to blame, especially because they were notified that this very thing was happening and reassured me it was safe?

[Phil21]

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

Haha, completely off topic here.  But for a winter here in Minneapolis, this was essentially the case.  For whatever reason, there was a huge rash of idiots leaving their cars running (while warming up, running in to get groceries, etc.).  It got to the point that the police refused to investigate any reports of stolen cars that were left running - they'd just take a report over the phone and that's that.

[Batouzo]

You stole 643 btc. Congrats.

Why would you call that stealing.

I go to art baazaar.
See some painting for just 1 USD and I buy it. This sort of paintings where between 1 usd and 1000 usd in last year I suppose, but I don't even have to know that or be art market expert.

If later it turns out that the painting was brought to the trading place not by lawful owner, but by someone that stolen it from next room, or stolen it weeks ago, or got this painting in exchange for some work that was not done well so it was sort of "stolen" .... then why do I care about this all, exactly?

[chihlidog]

I actually agree with OP 100%. This is Mt. Gox's responsibility to make right. Especially in light of numerous complains regarding security well before the plummet. The fact is they were in over their heads and they dont know what to do now. Who are they to roll back a market?

THEY allowed their system to be compromised. They alone. I dont care if it was an auditor. That auditor had authorization to access their files and was acting on authority of the owner. No difference. I have zero pity for Mt. Gox. The only right thing to do is to reimburse the original owner for everything that he lost (since there arent enough bitcoins available, they need to BUY them for him. Period.) and the OP be allowed to retain the bitcoins fairly purchased. If I had money in Mt. Gox at the time, I would have been furiously trying to buy, too. There were plenty of posts here that thought it was a legitimate selloff. The OP did nothing wrong. Period.

they "allowed" it to happen...?

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

The original victim didnt leave his car running. He left it in a garage that is supposed to be secure.

And the owner of the car was told that the garage wasn't secure but he didn't care, until this happened.

People who are making comparisons need to review the actual situation instead of making a straw man argument.

The garage owner assured everyone that their cars were secure, even when people borught concerns to his attention. His business operation was dependent on keeping said cars secure, and he ridiculed people who said they werent.

[myrkul]

The person whose account was hacked (if it was one person) is entitled to their Bitcoins and it's MtGox's responsibility to provide that to him. Kevin did nothing wrong making a large purchase of bitcoins, but now that he KNOWs the bitcoins were stolen, he's possessing stolen property, which can be a felony. The fact that MtGox's account was hacked makes all the difference here, as it makes the bitcoins which were traded stolen property.

This.

Even if the bitcoins were MtGox's to begin with, the trades should be reversed. Kevin did a pretty smart thing in jumping in there to grab those BTC, But the release of the DB shows that it was a hack, whether from an insider or from someone in it for the lulz, and the person (or persons) whose BTC those were should get them back.

[chihlidog]

I actually agree with OP 100%. This is Mt. Gox's responsibility to make right. Especially in light of numerous complains regarding security well before the plummet. The fact is they were in over their heads and they dont know what to do now. Who are they to roll back a market?

THEY allowed their system to be compromised. They alone. I dont care if it was an auditor. That auditor had authorization to access their files and was acting on authority of the owner. No difference. I have zero pity for Mt. Gox. The only right thing to do is to reimburse the original owner for everything that he lost (since there arent enough bitcoins available, they need to BUY them for him. Period.) and the OP be allowed to retain the bitcoins fairly purchased. If I had money in Mt. Gox at the time, I would have been furiously trying to buy, too. There were plenty of posts here that thought it was a legitimate selloff. The OP did nothing wrong. Period.

they "allowed" it to happen...?

okay, so if someone goes to 7-11, runs in for a second to buy something and leaves their car running it's no longer a theft if someone else takes it...? obviously the car is now theirs to sell, right...? they "allowed" their car to get stolen due to their own stupidity, so that's where the situation ends, right...?

The original victim didnt leave his car running. He left it in a garage that is supposed to be secure.

And the owner of the car was told that the garage wasn't secure but he didn't care, until this happened.

People who are making comparisons need to review the actual situation instead of making a straw man argument.

The garage owner assured everyone that their cars were secure, even when people brought concerns to his attention. His business operation was dependent on keeping said cars secure, and he ridiculed people who said they werent. Customers had faith in the business to keep their assets secure, as it was vital to the business and had a reasonable expectation of it, and listened to the owner when he said that they were indeed safe.

[LeFBI]

@toasty:
So, you are Kevin, the guy who bought 259684 of stolen BTC for under $3000. And with your essay you are here to complain that MtGox says you can't keep the stolen value but will get your money back? Tell that face to face to person who got robbed.

And btw, how do we know you are not related to the hacker? Maybe you just wanted to launder the stolen BTC that he(or yourself) sold on MtGox.

[toasty]

Given this, would you agree to a panel of senior community members (chosen at large by the community as a whole) to become a panel for arbitration between yourself and MtGox?  Lets call it 5 senior well-respected members, who both MtGox, yourself, and the community can all trust.

Kevin will submit his story, which he pretty much already did it seems.  MtGox will tell their side, and provide confidential information needed to verify it to these 5 panel members.

These 5 members will decide the best course of action in relation to your specific situation with the following guidelines given to them:
* The primary consideration is what is best for the community as a whole
* Any solution will not bankrupt or otherwise substantially impact MtGox's operational capabilities

This would accomplish the following, based on your +/- system:
+ Gives the community some semblance of transparency for a MAJOR issue with the bitcoin market as a whole (as it exists today, at least)
+ Allows both sides to tell their story in relative confidence, thus protecting any major run on markets or mtgox due to new info being released that may be damaging.
+ Keeps this situation out of the court system, where it really has no business belonging and everyone is a loser
+ Quick resolution if MtGox agrees to this, I can't imagine it taking more than a few hours?
- Random panel of 5 "Internet Dudes" are deciding your fate
- You have a very substantial chance of being ordered to give back the BTC you withdrew, should the community members deem it appropriate

I believe this solution, with of course some tweaks to make both parties feel comfortable can accomplish everyone's *stated* goals here.  It will allow Kevin to know what happened, so he knows he's not being completely taken advantage of, it will allow the community to gain transparency and show to outsiders we can resolve problems in an expediant and reasonable manner.  Additionally MtGox will be able to end the rampant speculation as to their activities, and at least for me personally I'd regain a lot of confidence in their exchange.

Does someone have anything better?  Kevin, do you agree in principle to this?  MtGox?  Community feedback?

My personal goal is the longevity of Bitcoin.  Discussions with Kevin lead me to believe this is also his goal as well.  Is it MtGox's goal?  They have stated it is!  If so, step up!  If they do not, then I will have lost faith in their motives myself.  Others will make their own decisions.

As long as I didn't feel it was filled with people who had already made up their minds before starting, or if we could use a mutually agreed on professional arbitrator, I'd be up for something like that.

I don't want to feel like I'm participating in some kind of "tragedy of the commons" scenario. If the community consensus says doing X is overall the best option for EVERYONE, I'd be willing to go along with it. I'm far less concerned with my own outcome than I am of the effect all of this will have on everyone.

[toasty]

@toasty:
So, you are Kevin, the guy who bought 259684 of stolen BTC for under $3000. And with your essay you are here to complain that MtGox says you can't keep the stolen value but will get your money back? Tell that face to face to person who got robbed.

And btw, how do we know you are not related to the hacker? Maybe you just wanted to launder the stolen BTC that he(or yourself) sold on MtGox.

Do you know how I can tell you didn't read the original post?

[bitbitcoincoin]

Sorry Kevin, but Mt Gox is making this right, it's just not right for your financial gains.

Although your transaction went through, it happened during a time when the exchange was not under legitimate terms, so of course the only recourse is to roll back any transactions up to the breaking point of legitimacy.   To not do so would destroy the economy to the point of making all those bitcoins you "earned" effectively worthless.

[Torminalis]

It is wildly obvious that there was no single guy with a cool half million coins in his account.

It wasn't long ago that everyone was gawping at some 425k coins being moved, presumably offline by the MtGox lot. Then there are 50,000 users they have picked up in the last month. (I was about 11,000 and I signed up on June 1st, there are 60,000 odd on the list now!). They offline most of their funds and just keep a float, hence the maximum withdrawal limit.

All the coins that people see trading are all just numbers in a database. The hacker clearly had much more control than is being let on, I would imagine he ran a SQL script of some sort to dump all of the dbCoins into one account and then put in a sell for next to nothing.

MtGox cannot afford to honour all of the coins. That is all of the coins they have, and everyone else who is daft enough to leave their coins on a public exchange run by beginners. If they honour your claim, there is no more MtGox and everyone and their mother will be up in arms, litigating, leering and generally ousting them from the community they have helped to build.

The bottom line is that you are losing the coins no matter how much you complain. You say you should keep them for the good of the community but if you've got half of the freely traded bitcoins then the market really is gone. Tough luck.