Original post of the OP :
This post offers information regarding the Bitcoinica debacle with insight and facts gathered from public records and a shareholder of Bitcoinica Consultancy. In addition, it seeks to warn the community about Tihan Seale and his continued involvement in bitcoin.
This post assumes readers are familiar and agree with a few of the current well-evidenced opinions pervasive on bitcointalk. These are:
*Zhou Tong stole from Bitcoinica
*Bitcoinica possibly had inflated numbers and fraud may have been the reason the database was destroyedhttps://bitcointalk.org/index.php?topic=95738.0https://bitcointalk.org/index.php?topic=95795.0
Tihan Seale, a panelist at the 2013 Bitcoin Conference
Peter Vessenes, Co Founder of Coinlab and associate and friend of Tihan Seale
Before bitcoin ever existed, Tihan was accused of fraud by a company with over a billion dollars a year in revenue:http://www.wiwd.uscourts.gov/opinions/pdfs/2003-2005/05-C-368-C-11-04-05.PDF
"...should not be able to claim immunity on the basis of jurisdiction for actions involving fraud or misrepresentation..."
A statement from the judge reads, "It is true that the former Seale defendants made statements earlier in this lawsuit that now appear less than forthcoming." http://www.wiwd.uscourts.gov/opinions/pdfs/2003-2005/05-C-368-C-09-20-06.PDF
SPECULATION: If I read this correctly in the initial suit, Tihan’s request for dismissal is granted to him on the basis that he had never been to Wisconsin. Land’s End files to continue the suit on the basis of new information discovered, and it is granted. The plaintiff’s request to return Tihan to the list of defendants was denied, as the judge ruled against the inclusion based on the time that had passed. The judge did note that Tihan had been less than forthcoming – a polite way of calling someone a liar. Perhaps a lawyer could chime in and I can remove the speculation label.
Here is litigation suggesting Tihan is connected to a company called 'Smash-Clicks' among many others.http://www.bizapedia.com/people/TIHAN-SEALE.html
Smash Clicks has, according to scambook.com, no known employees and is being accused of a common type of fraud similar to cramming, Cramming was the 4th most common consumer complaint as of 2007 in the United States.http://www.scambook.com/company/view/9693/Smash-Clickshttps://en.wikipedia.org/wiki/Cramming_%28fraud%29
The aforementioned have nothing to do with bitcoin or Bitcoinica, continuing to bitcoin related matter we can see that:
* Tihan has never posted anything harsh towards Zhou Tong (please link me if I am wrong)
* Tihan was aware that Bitcoinica was operating in the red after the Linode hack and that this amount was never settled. Tihan never shared this with the bitcoin community even many months after the hack. (this can be known because it was the investors who agreed to pay “in full” and also much of the database reconciliation data came from Tihan himself – he checked records daily. The leaked source code also shows his day to day involvement with bitcoinica.)
* Tihan refused to nullify an NDA.
* Tihan only publicly identified himself after pressure from Bitcoinica Consultancy. Had this not happened, Wendon Group may have been publicly associated with a single person.
* Tihan is a self-proclaimed scout of Wendon Group. Wendon Group is a company which has no publicly known workers except for himself (that is, if you want to take his word), it also has no publicly known owners. If you read the previous lawsuit against Tihan Seale, you will see that despite his personal credit card being used to purchase the domain name in question which was used to commit fraud, there was deemed to not be enough evidence to directly affiliate him with the site and it's fraud (PLEASE do not let a cursory glance make you believe this was a simply domain-squatting case).
Much of Tihan's nature cannot be showcased in this format but can only be derived from his actions and statements over time. What they reveal and how they contradict should frighten bitcoin enthusiasts, especially considering his links to bitcoin companies and his circle of friends.
Speculation: Tihan is a professional con-artist.
While some of the following information was leaked most of it is public information. It is my intention to compile a 'Bitcoinica Timeline' in this post. Please forgive me if any of the accounts are not in proper order. I expect a few minor mistakes due to the complexity but I am completely confident in the story and the general nature of this post. I will update the post as much as I can and in a reasonable amount of time. If you can provide citations please PM me or post them in this thread. Your help is appreciated.
Here we go:
The Bitcoinica Timeline:
* SEPT 4th 2011 - Zhou starts building Bitcoinica
* SEPT 9th 2011 - Bitcoinica launches
* NOV XX 2011 - Zhou is approached by an 'investor' and later states: "The investor demands his identity to be protected so I won't share more information on this."
* XXX XX 2011 - Tihan allegedly meets Zhou in person in China (please help me source this, while it is spoken as general information on the forums I cannot find evidence of this claim)
* JAN (late in month) - Zhou sells Bitcoinica (presumably to Wendon Group)
Zhou is allowed to keep all site earnings until the late January official hand over time, and is kept on at a salary of $8,000 to $10,000 a month. He is attending university at this time.
Citation for the previous posts: https://bitcointalk.org/index.php?topic=81581.0
*People comment on Zhou's change in his English on the forums. It is believed that Tihan was posting under Zhou's account and taking an active role in the running of Bitcoinica. (please help provide citation)
*MAR 02 2012 - Linode Hack occurs
Unknown investors say they will reimburse users for the "full amount" according to Zhou.https://bitcointalk.org/index.php?topic=66979.0
*APR XX 2012 - Tihan meets Donald and Patrick in person to discuss Bitcoinica
During the meeting they discover that money from the Linode hack has not been refunded, however they are lead to believe that Wendon Group is a sizable company which at any given time has many investments, 10 or more of which Tihan is involved in. Due to the initial way Tihan was contacted (The previous owner of bitcoin.com 'David Lowry' told Donald that the domain name was sold to Tihan) people are also put under the impression that the business Tihan works for owns bitcoin.com (at that time worth $1,000,000 - now presumably much more). Simply the domain name's value far exceeds the amount which bitcoinica had covered only in word.
*Bitcoinica Consultancy forms and enters agreement which specifically stipulates the missing funds require providing.
*Bitcoinica Consultancy becomes aware of a serious security flaw in Bitcoinica that Zhou was aware of for over one month. Not reporting such a flaw is tantamount to fraud. The fact that Zhou was working on improving site features while aware of a serious exploit was also alarming.
*MAY 11th 2012 - Bitcoinica is hacked https://bitcointalk.org/index.php?topic=81045.0
The 'hack' happens while Zhou and Tihan were still exclusively operating Bitcoinica (although potentially only a couple days before a switchover) - the delay was, at least in part, caused by the fixing of the serious exploit.
(this can be cited from the source code which is linked later)
*MAY 14th 2012 or earlier - Tihan says investors will "carry bitcoinica through". Bitcoinica Consultancy has no reason to think Tihan is lying and actually praise 'the investors'. Bitcoinica Consultancy believe that the investors exist and are separate from Tihan. Bitcoinica Consultancy still have no reason to believe that Wendon Group will not honor previous agreements. Also they have no reason to think that Wendon Group has misrepresented itself.
*MAY 14-20 2012 - It is realized that the database is both missing and the partial records are not enough to reliably compile account balances. All parties privy to this believe it is responsible to keep the information that the database is incomplete private and start a claim's process. The publication of such information could seriously damage the integrity of the claims process.
Currently, it is believed by at least a few people that still post about Bitcoinica that it was beneficial for Zhou to destroy the database in the case that Bitcoinica volumes were faked. Fraudulently reporting earlier volume would cause investors to be misinformed of the value of Bitcoinica and this would allow for Bitcoinica to be sold at a higher price. To do this, it would require that Zhou Tong keep the misreported site profits up until the point of sale, which he did. I have been unable to find find historic volume charts for the site, if someone could link these that would be very helpful.
* May 15 2012 - Bitcoinica Consultancy had disagreements with Zhou and expressed that he was behaving unethically.
* May 25 2012 - Bitcoinica Consultancy push Wendon Group to come forward and Tihan Seale begins posting on Wendon Group's behalf. Bitcoininca Consultancy is happy that at least one person can be publicly linked to Wendon Group and believe it was worth the harm caused to their reputation as well as the Bitcoinica brand (grievances were publicly aired in order for Tihan to come forward). Bitcoinica Consultancy is ridiculed by Zhou for 'Bad PR practices'. Bitcoinica Consultancy maintains that PR is not a concern if businesses are behaving unethically. Unfortunately, very little materializes and Wendon
Group's lack of transparency is not questioned. Neither is any significant amount of pressure put on Tihan to drop the NDA. While Bitcoinica Consultancy thought very poorly of Zhou Tong and Tihan Seale at this time, there was no reason for Bitcoinica Consultancy to think that Zhou was a thief or that Tihan had committed fraud.
*June 5th 2012 - Bitcoinica Consultancy tries to contact Andrew Thornhill. In petty matters Tihan has proven himself to be a liar (the extent of his fraud is not discovered until later). This, coupled with the lack of reconciliation for the missing funds stemming back to the Linode hack causes great concern for Bitcoinica Consultancy who are happy to help the claims process but are against the reopening Bitcoinica until this is solved. From this point on, I believe Bitcoinica was doomed to liquidation. I ask Bitcoinica users to be mindful of situations which could have played out but did not. Liquidation is far preferable than Bitcoinica evolving into a Ponzi scheme comparable to Pirate40's or even worse, to in a few years be comparable to that of Bernie Madoff's. Bitcoinica Consultancy privately prides itself on any role it may have had which leads to the dissolution of Bitcoinica given the circumstances.
*June 4 2012 - Tihan is not forthcoming in producing Andrew Thornhill's contact (the only other person known to have association with Wendon Group). This is a request which requires repeated attempts. Tihan even replies to a short email which asks for Mr. Thornhill's number and does not provide the contact.
(this will be citationed in the future)
*June 8th 2012 - Tihan provides Andrew Thornill's contact after at least 4 days of requests.
(this should have a citation in the future)
* June 25/26 2012 – After weeks of attempting to contact Andrew Thornhill on the telephone a single contact has not been made. He will not return calls despite many messages to his secretary. Mr. Thornhill is warned in the strictest way via his secretary that failure to respond may will hurt Wendon Group's image. After this, when he is next contacted, a short 1 or 2 minute conversation takes place. He repeatedly says that he has no association with Wendon Group and provides no details before hanging up.
(Unrecorded phone conversations, although users are free to contact Mr. Thornhill themselves to ask if he has any relation to Bitcoinica)
*JUN 26 2012 – An associate who seems to be the superior of Andrew Thornhill is contacted via email to describe the situation and the great attempts made to contact Wendon Group. Wendon Group is still believed to be an investment firm with many investments and workers.
(this will have a citation in the future)
*JUN XX 2012 – Tihan responds forwarding the email which was sent on June 26th. He says that his life is ruined and that he can longer work with Mr. Thornhill. When he was initially asked for Mr. Thornhill's contact he had pleaded and reminded Bitcoinica Consultancy that he has a family. His suggestion that he cannot work with Mr. Thornhill and that his life is ruined coupled with his earlier pleading about his family make Bitcoinica Consultancy believe that Tihan has been fired from his position.
Much later, around mid-July, Tihan would make a post on bitcointalk.org which he would later delete. In the post he says that Bitcoinica Consultancy is lying and that he was never fired from Wendon Group. This information confuses Bitcoinica Consultancy at first, thinking he may have been rehired, but then, weeks later and with the help of additional information, they begin to suspect that Tihan in fact owns large part or the entirety Wendon Group. They begin to believe that Mr. Andrew Thornhill, was simply a lawyer, with client-lawyer, confidentiality purchased to become the director of Wendon Group in an attempt to make it extremely difficult, if not reasonably impossible, to link Tihan to Wendon Group. In the case that Wendon Group committed or would commit fraud, much like with what Tihan's was accused of in the earlier lawsuit against him, Tihan would be able to claim that he was only a scout for Wendon Group.
*JUL 1 2012 - Payments are 27% refunded - in the next 12 days the payments would go up to being 38% refunded. 50% payments were being made to verifiable claimants and once payments were at 50%, the remaining would be distributed pro-rata. This means that the process was at least 70% complete as of July 13th. Before any refunds were made an overall idea of the liabilities needed to be understood. Estimating the liabilities alone took a lot of time which is at least part of the reason why payments were not made for a long time and then started to be made relatively fast. Despite great progress after months of wait, Bitcoinica creditors were more anxious to sue than ever. This may be because some creditors wished to seek a better result for themselves and unfairly be rewarded in relation to other bitcoinica claimnants. The following chat gives some indication of what was going on.
[7/1/2012 9:31:26 PM] Patrick Strateman: jed stop calling me
[7/1/2012 9:31:34 PM] Jed McCaleb: well then pick up
[7/1/2012 9:31:42 PM] Jed McCaleb: you should talk to us
[7/1/2012 9:31:52 PM] Jed McCaleb: you are holding a lot of our money
[7/1/2012 9:32:10 PM] Jed McCaleb: we deserve a real explination
[7/1/2012 9:32:20 PM] Patrick Strateman: i've told you before and i will not tell you again
[7/1/2012 9:32:28 PM] Jed McCaleb: what you said makes no sense
[7/1/2012 9:32:33 PM] Patrick Strateman: the 50% payout is an initial payment
[7/1/2012 9:32:45 PM | Edited 9:32:54 PM] Jed McCaleb: yes and why are you waiting for the rest?
[7/1/2012 9:32:59 PM] Patrick Strateman: the remaining available funds will be used to payou the additional value of the rest pro rata to other claims
[7/1/2012 9:33:09 PM] Incitatus: patrick what is holding up the other people, jed has been half paid, what about the other 2 people here
[7/1/2012 9:33:33 PM] Patrick Strateman: if additional funds become available such as the investment group or tihan should do so then those funds will be used to pay out
[7/1/2012 9:33:44 PM] Jed McCaleb: when are you going to terminate the claim process? you will never get all accounts claimed
[7/1/2012 9:33:59 PM] Patrick Strateman: however we are required by both law and just common sense to assume that neither will happen
[7/1/2012 9:34:05 PM] Jed McCaleb: no you are not
[7/1/2012 9:34:23 PM] Incitatus: [Sunday, July 01, 2012 9:33 PM] Jed McCaleb:
<<< when are you going to terminate the claim process? you will never get all accounts claimedthere is a legal obligation i believe to keep it open
[7/1/2012 9:34:24 PM] Jed McCaleb: common sense says to pay the people you are sure about
[7/1/2012 9:34:35 PM] Jed McCaleb: then we will never be paid?
[7/1/2012 9:34:49 PM] Patrick Strateman: i believe we have been very clear
[7/1/2012 9:34:55 PM] Incitatus: [Sunday, July 01, 2012 9:34 PM] Jed McCaleb:
<<< common sense says to pay the people you are sure aboutthat would favour some users above others. I believe tihan was pro this
[7/1/2012 9:34:57 PM] Jed McCaleb: no you have not
[7/1/2012 9:35:18 PM] Patrick Strateman: there is an upper limit to the total liabilities
[7/1/2012 9:35:41 PM] Incitatus: Patrick is there anyone here in this convo that hasn't been half paid back?
[7/1/2012 9:35:51 PM] Incitatus: I was under the assumptin that Jesse hadn't been half paid
[7/1/2012 9:35:52 PM] Patrick Strateman: the claims we have marked as accurate so far are off from that mark by a few hundred thousand dollars
[7/1/2012 9:35:57 PM] Incitatus: i think i looked at hsi claim the other day
[7/1/2012 9:36:03 PM] Incitatus: what is holding it up
[7/1/2012 9:36:15 PM] Patrick Strateman: jesse has not because it's a large claim and the password hash is missing
[7/1/2012 9:36:24 PM] Patrick Strateman: and there wasn't a username<-> email link
[7/1/2012 9:36:31 PM] Incitatus: What do we need from Jesse then?
[7/1/2012 9:36:32 PM] Patrick Strateman: so verifying who owned the account isn't trivial
[7/1/2012 9:36:34 PM] Jesse: I gave you my password hash and you couldn't verify it for whatever reason.. the password was correct
[7/1/2012 9:36:35 PM] Jed McCaleb: yes but when will you stop the claims process? otherwise it won't end. there will never be a time when all accounts are claimed
[7/1/2012 9:36:49 PM] Patrick Strateman: we only have about 1/5th of the hashes
[7/1/2012 9:37:00 PM] Patrick Strateman: it's from a financial report from january
[7/1/2012 9:37:11 PM] Jed McCaleb: not sure how it is better to do all this typing then just have a 5 min call
[7/1/2012 9:37:15 PM] Incitatus: [Sunday, July 01, 2012 9:36 PM] Jed McCaleb:
<<< yes but when will you stop the claims process? otherwise it won't end. there will never be a time when all accounts are claimedthe pro rata paymetns can go out without the claims process closing i think
[7/1/2012 9:37:20 PM] Incitatus: it's just that if bitcoinica gets future profits
[7/1/2012 9:37:23 PM] Incitatus: tehy will go to the claims
[7/1/2012 9:37:37 PM] Roger Ver: I have not gotten my half of my bitcoins back yet either.
[7/1/2012 9:37:44 PM] Patrick Strateman: the claims process cannot close ever
[7/1/2012 9:37:52 PM] Jed McCaleb: > the pro rata paymetns can go out without the claims process closing i think
ok so when is that happening?
[7/1/2012 9:37:54 PM] Jesse: anyway, I was ablet o verify all the other info on the account, and if you can ever get ahold of Zhou for the scans, you'll have my ID confirmation as well. You guys should have wrangled him in a long time ago. how long are you going to wait for him?
[7/1/2012 9:38:24 PM] Incitatus: [Sunday, July 01, 2012 9:37 PM] Jed McCaleb:
<<< > the pro rata paymetns can go out without the claims process closing i think
ok so when is that happening?when we've given a final judgement on all the claims far fewer claims are coming in a day now than we are solving
[7/1/2012 9:38:47 PM] Jed McCaleb: when?
[7/1/2012 9:38:51 PM] Jed McCaleb: a date
[7/1/2012 9:39:02 PM] Incitatus: lol
[7/1/2012 9:39:04 PM] Patrick Strateman: jesse can you add me as a contact
[7/1/2012 9:39:30 PM] Roger Ver: Patrick, lets all meet for Dinner in SF tonight and get this straightened out. Jesse, Myself, and Jed are all willing to make time for this.
[7/1/2012 9:39:36 PM] Jed McCaleb: patrick: is all your USD in mtgox?
[7/1/2012 9:39:52 PM] Incitatus: [Sunday, July 01, 2012 9:38 PM] Jed McCaleb:
a datei'm not sure how that can be guessed, I hope it would be done before the end of the month
[7/1/2012 9:40:14 PM] Incitatus: [Sunday, July 01, 2012 9:39 PM] Jed McCaleb:
<<< patrick: is all your USD in mtgox?I know there was some bank account involved
[7/1/2012 9:40:31 PM] Patrick Strateman: there is like 80k in a bank account in nz
[7/1/2012 9:41:29 PM] Incitatus: that should be probably not used for payouts bc of transfer fees
[7/1/2012 9:41:32 PM] Incitatus: but should be sent to gox
[7/1/2012 9:41:42 PM] Jed McCaleb: please don't send this to gox
[7/1/2012 9:42:09 PM] Jed McCaleb: I'd much rather have a wire and that is about how much you owe me
[7/1/2012 9:42:42 PM] Incitatus: oh yea forgot, 2 wires, 40$ extra but no chance of it getting stuck wtih gox
[7/1/2012 9:43:11 PM] Jed McCaleb: $40 is the least of my concerns right now
[7/1/2012 9:45:18 PM] Roger Ver: Patrick and Donald, when can I expect the first half of my Bitcoins back?
[7/1/2012 9:45:39 PM] Incitatus: [Sunday, July 01, 2012 9:45 PM] Roger Ver:
<<< Patrick and Donald, when can I expect the first half of my Bitcoins back?what is your username, you can send it to me privately
[7/1/2012 9:45:44 PM | Edited 9:46:05 PM] Jed McCaleb: so patrick what are you going to do about all these claims that you can't substantiate? If someone claims $100
and you verify that they are who they say they are you are going to give them $50 and then pro rata for the rest?
[7/1/2012 9:46:29 PM] Jed McCaleb: that seems like what you are doing. Which is really really wrong
[7/1/2012 9:48:29 PM] Jed McCaleb: The proper way to do this is:
pay every claim you are certain of pro rata the rest any other way you will be stealing from honest people
[7/1/2012 9:48:56 PM] Patrick Strateman: convenient that gets you back all your money at other peoples expense jed
[7/1/2012 9:49:04 PM] Jed McCaleb: no it doesn't
[7/1/2012 9:49:08 PM] Patrick Strateman: now if you'll excuse me i have useful stuff to do
[7/1/2012 9:49:32 PM] Roger Ver: PAtrick, the useful things you need to do should have paying back honest people like the three of us, ASAP
[7/1/2012 9:49:39 PM] Jed McCaleb: yes I should get all my money back
[7/1/2012 9:49:42 PM] Jed McCaleb: it is my money
[7/1/2012 9:49:55 PM] Jed McCaleb: the investors already said they would cover the loss
[7/1/2012 9:50:02 PM] Jed McCaleb: you have nothing to worry about
[7/1/2012 9:50:15 PM] Jed McCaleb: you are just being hard headed
[7/1/2012 9:52:34 PM] Patrick Strateman: oh do you have a signed contract from them to that effect?
[7/1/2012 9:52:37 PM] Patrick Strateman: yeah i didn't think so
[7/1/2012 9:52:53 PM] Jed McCaleb: what are you worried about exactly?
[7/1/2012 9:53:22 PM] Incitatus: [Sunday, July 01, 2012 9:49 PM] Jed McCaleb:
<<< yes I should get all my money back it is my money the investors already said they would cover the lossthey said they would "cover bitcoinica through" or something like that. The 'investor' said he had no affiliation with tihan
[7/1/2012 9:53:41 PM] Incitatus: tihan's word is worth 0.00$ or maybe less than that
[7/1/2012 9:53:55 PM] Incitatus: makes the whole thing a lot harder
[7/1/2012 9:54:24 PM] Patrick Strateman: im worried that we'll send out all the funds get to people who have waited patiently and have nothing to give them
[7/1/2012 9:54:24 PM] Jed McCaleb: but seriously what are you worried about? you think you will be personally sued by the investor if you give money back that you don't own?
[7/1/2012 9:54:35 PM] Patrick Strateman: i think that's a reasonable thing to guard against
[7/1/2012 9:54:58 PM | Edited 9:55:05 PM] Jed McCaleb: but why would that happen unles you give to people with illegitament claims. we are not those people
[7/1/2012 9:55:13 PM] Patrick Strateman: i've told you several times already
[7/1/2012 9:55:21 PM] Jed McCaleb: but what you said doesn't make sense
[7/1/2012 9:55:25 PM] Patrick Strateman: the funds available to pay back are less than the known liabilities
[7/1/2012 9:55:40 PM] Incitatus: yep Jed, he's answered that question a few times now
[7/1/2012 9:55:53 PM] Patrick Strateman: people have said they will cover the difference but i have yet to see any actual funds or anything in writting to that effect
[7/1/2012 9:55:57 PM] Jed McCaleb: but are those liabilties what people have claimed or are they liabilites you are 100% certain of?
[7/1/2012 9:56:41 PM] Patrick Strateman: so you're implying that we should shutdown the claims process and tell anybody who attempts to open a claim later that they're out of luck?
[7/1/2012 9:56:50 PM] Patrick Strateman: that would be completely and totally illegal
[7/1/2012 9:56:55 PM] Patrick Strateman: as well as horrendously immoral
[7/1/2012 9:57:02 PM] Jed McCaleb: no that isn't what I'm saying
[7/1/2012 9:57:05 PM] Roger Ver: We are saying that you should pay back the claims that you are %100 certain of.
[7/1/2012 9:57:17 PM] Roger Ver: I have provided you with my entire account history from day one.
[7/1/2012 9:57:24 PM] Jed McCaleb: exactly
[7/1/2012 9:57:34 PM] Patrick Strateman: that's the same thing
[7/1/2012 9:57:42 PM] Patrick Strateman: if there's only 80% available funds
[7/1/2012 9:57:46 PM] Patrick Strateman: and i pay out back 100%
[7/1/2012 9:57:50 PM] Patrick Strateman: someone else is getting shafted
[7/1/2012 9:57:57 PM] Jed McCaleb: if you don't have enough money to pay people back it is because you paid someone too much. that someon isn't us.
[7/1/2012 9:58:19 PM] Patrick Strateman: you can bitch and moan until you're blue in the face but im not doing something i feel to be truly immoral
[7/1/2012 9:58:31 PM] Incitatus: Also something I said to Rodger Ver that people might not know
[Sunday, July 01, 2012 9:57 PM] Incitatus:
<<< Making non automated payments alone is a scary thing. That's another advantage of making 50% payments. If you do a set of double withdraws, instead of being in debt for life you are peachy once everyone's gotten 50% it can be automated prorata
[7/1/2012 9:58:39 PM] Incitatus: automation does not lead to mistakes
[7/1/2012 9:58:56 PM] Jed McCaleb: so it is 100% moral and responsible to do the best you can. and you *know* that you owe us so you should pay us. there is no ambiguity.
[7/1/2012 9:59:06 PM] Incitatus: [Sunday, July 01, 2012 9:57 PM] Jed McCaleb:
<<< if you don't have enough money to pay people back it is because you paid someone too much. that someon isn't us.or because
[7/1/2012 9:59:13 PM] Jed McCaleb: we shouldn't be your buffer for making mistakes with other claims
[7/1/2012 9:59:15 PM] Incitatus: the funds promised weren't delivered
[7/1/2012 9:59:30 PM] Incitatus: [Sunday, July 01, 2012 9:59 PM] Jed McCaleb:
<<< we shouldn't be your buffer for making mistakes with other claimsother people shouldn't be buffers either
[7/1/2012 9:59:39 PM] Patrick Strateman: jed im not talking with you anymore as you're being unreasonable
[7/1/2012 9:59:47 PM] Jed McCaleb: oh my god
[7/1/2012 10:00:01 PM] Patrick Strateman: if you continue to insist that we do something we believe to be immoral that's your business
[7/1/2012 10:00:05 PM] Patrick Strateman: but stop telling it to me
[7/1/2012 10:00:33 PM] Roger Ver: When will I get my 50% ? I haven't gotten an answer abou tthat yet.
[7/1/2012 10:00:37 PM] Jed McCaleb: how on earth is it immoral to pay someone back that you *know* you owe!
[7/1/2012 10:01:17 PM] Jed McCaleb: if you don't have enough to pay someone else it is becasue *you* fucked up not me
[7/1/2012 10:01:39 PM] Jed McCaleb: it is immoral to take money from me to fix *your* mistake
[7/1/2012 10:02:21 PM] Incitatus: [Sunday, July 01, 2012 10:00 PM] Jed McCaleb:
<<< how on earth is it immoral to pay someone back that you *know* you owe!
if you don't have enough to pay someone else it is becasue *you* fucked up not me
it is immoral to take money from me to fix *your* mistakeif there is only 80% of the funds available and 90% of people ahve full proof how is it fair to pay you back
more than the other people who have full proof
[7/1/2012 10:02:36 PM] Incitatus: you have to realise two jed's could be saying the exact some thing to us
[7/1/2012 10:02:43 PM] Jed McCaleb: yes pay back everyone with full proof
[7/1/2012 10:03:01 PM | Edited 10:03:07 PM] Jed McCaleb: if they have full proof then you should have enough to cover it
[7/1/2012 10:03:06 PM] Incitatus: if the full funds are not there than it is impossible to pay everyone back fully
[7/1/2012 10:03:37 PM] Jed McCaleb: did you have all the funds before you were hacked?
[7/1/2012 10:04:19 PM] Incitatus: [Sunday, July 01, 2012 10:03 PM] Jed McCaleb:
<<< if they have full proof then you should have enough to cover itthere was a robbery. Tihan said the investors would "cover bitcoinica through" whatever that means then he said he was just a passive investor himself (or passive participant of some sort) and since then the guy he was representing says he's not affiliated with tihan
[7/1/2012 10:04:19 PM] Roger Ver: If the full funds are not there, you still should pay back %100 to the people who's account balance you can verify %100 for sure.
[7/1/2012 10:04:55 PM] Jed McCaleb: has the real investor said he wont cover the loss?
[7/1/2012 10:05:08 PM] Jed McCaleb: have you asked him to cover the loss?
[7/1/2012 10:06:48 PM] Incitatus: [Sunday, July 01, 2012 10:04 PM] Jed McCaleb:
<<< has the real investor said he wont cover the loss?It took me a month to get in touch, Tihan wouldn't provide the guy's phone number for me, + i don't think the guy is an investor but he actually represents them or something, I really don't know the situation. We are totally in the dark here. I would like Tihan to release the NDA so that I can make this type of stuff public
[7/1/2012 10:07:44 PM] Roger Ver: Please send my 24,841 Bitcoins to: 1EiWZECz5A5P2ZbauguHt8B9f4MxnP1dEF or a MTGOX code would be fine. I've clearly provided %100 proof for this time and time again. I am not interested in waiting any longer.
[7/1/2012 10:08:06 PM] Roger Ver: If you feel you need aditional proof, just tell me what you need and I will provide it right now.
[7/1/2012 10:09:04 PM] Roger Ver: The account name was ******** (Edited out)
[7/1/2012 10:11:02 PM] Patrick Strateman: i've blocked both roger and jed on skype any futhur communication with me will be through email@example.com
[7/1/2012 10:27:58 PM] Jed McCaleb: wow. mature. I don't think it is unreasonable to want an explination that makes sense. I'm sure you would want the same if you were in my shoes
It should be noted that Roger Ver had already received half a payment for his claim at the time of this conversation. This is why he is asking sometimes for only half of his bitcoins. There are still valid claimnants which have not received half payments yet.
July 11th 2012 - Jesse Powell has a conversation which at least borders and maybe crosses on threatening frivolous litigation/attempting extortion - despite the fact that payments have been going out to bitcoinica claimants at a very good pace for the past month, Jesse Powell demands releasing 100% of his claim (he has been told multiple times that this would be unethical and potentially illegal as it would mean he gets a higher percentage of his claim than other bitcoinica users). He also offers 80% of his claim to make an deal. He is allegedly in talks with Wendon Group to make this deal. Bitcoinica Consultancy is worried he may be acting on behalf of Wendon Group who has shown no interest to pay the missing funds and has been incommunicable. Please remember Jesse and his friends seem disinterested in Wendon Group's lack of transparency. Other reasons why this deal cannot be made are addressed later in this post in the 'Unanswered Questions' section.
[7/11/2012 10:23:37 PM] Jesse: you three clearly have control over the payouts now so it's up to you whether you want to take this deal and protect yourselves or not
[7/11/2012 10:23:37 PM] Incitatus: and there are immediate and obvious problems with it even if such a deal were both legal and ethical to make
[7/11/2012 10:23:51 PM] Jesse: you all got it to your presonal emails as well.. youn eed to worry about more than bitcoinica.. this is about you personally as well
[7/11/2012 10:24:11 PM] Jesse: ok. we'll proceed with our suit then and we're coming after a lot more than 80%
[7/11/2012 10:24:19 PM] Jesse: I recommend again that you get an attorney
[7/11/2012 10:24:55 PM] Incitatus: I understanding that you're threatening to personally ddos us within the legal system and that's a bit of a joke. It would help your case if you actually provided the right document to legal@ bitcoinica
[7/11/2012 10:25:07 PM] Jesse: that's correct
[7/11/2012 10:25:15 PM] Incitatus: which is correct?
[7/11/2012 10:26:04 PM] Jesse: we're threatening to sue you for the money that you owe us. bitcoinica is only one defendant. you, patrick and amir are also defendants individually. I figured that one of you would at least care about getting sued yourselves, and maybe pass the info along to bitcoinica legal
[7/11/2012 10:26:43 PM] Jesse: anyway, it's clear that you guys just want to play games and you don't understand that you're personally involved and you're just trying to use bitcoinica as a shield. we're coming after each of you AND bitcoinica
[7/11/2012 10:27:04 PM] Jesse: you can give us the 80% now and settle, or you can give us the 100% + attorneys fees later
Please couple this chat in your mind with a comment from the New Zealand liquidators which reads,
"Lastly, we are aware of legal proceedings underway in California against the Limited Partnership. The Liquidators have sought to have the Limited Partnership withdrawn from the proceedings on the basis that it is in liquidation. We are concerned that the plaintiff investors may be seeking to better their position ahead of other investors, and we wish to see everyone treated fairly and equally."https://bitcointalk.org/index.php?topic=126847.0
*JUL mid 2012 – Amir, acting alone, leaks the Bitcoinica source code in a failed attempt to show that Tihan was lying about not operating bitcoinica. A poor security practice by Zhou or Tihan was for a while believed to be responsible for the later hack. The security practice can be comparable to having the same password as your username. Amir could not have known or expected such a possibility. Had Bitcoinica later licensed out their software or had MtGox made the 'username' codes public (which would not unreasonable of MtGox) then such a security flaw could be leaked. Since the incident, even Zhou Tong's own admission limits the suspects in the theft to Zhou Tong or his mysterious associate who had access to Zhou Tong (cited earlier).http://www.reddit.com/r/Bitcoin/comments/w6xen/bitcoinica_press_release/
*July 13th 2012 (9AM) – Last Bitcoinica hack
Payments made to claimants were 38% complete (making the whole process at least 76% complete. The MtGox account belonging to Bitcoinica is hacked. Later it is discovered Zhou Tong was responsible for this hack.https://bitcointalk.org/index.php?topic=93074.0
*JULY 13th (hours later) Zhou distributes 5,000 BTC (2PM)https://bitcointalk.org/index.php?topic=93100.0
Zhou distributes 5,000 BTC (this amount is very near the value that Bitcoinica was in the red a day before the hack, -77,000$. 5,000BTC was worth at that time approximately 80,000$)
After Zhou was caught red-handed people believed the 5,000 BTC distribution had to do with guilt. The fact that 5,000 BTC equaled the amount that was missing from the Linode hack makes me think Zhou was simply afraid that if bitcoinica was liquidated he could face trouble for his involvement with the operation of the site. I believe he though this act might help greatly mitigate such a future problem.
* JULY 17? 2012 - Tihan makes a post saying Bitcoinica Consultancy were lying about Tihan being fired. The post is later deleted. I have heard that bitcointalk saves deleted messages. Perhaps Theymos would be able to retrieve the post if it is not against his ToS. The post would show the depth of manipulation and lies of Tihan Seale.
The recovery of the post could be used to hold Tihan personally responsible if he is unable to show anyone else associated with Wendon Group aside from Andrew Thronhill who seems to have simply been his puppet lawyer.
*JUL 26 2012 - Evidence is released and people belive Zhou is responsible for the hack
Origional post by aurumxchangehttps://bitcointalk.org/index.php?topic=95738.0
*July 29th 2012 - Patrick Murck makes first bitcoinica related post. He has connections to Tihan and Coinlab and had posted about being asked by creditors to help out. I would guess these creditors are Roger Ver and Jesse Powell among others. In emails with Bitcoinica Consultancy, he did not specify who he was representing and cooperation with him may have amounted to at very least negligence on Bitcoinica Consultancy's part. Coinlab has been since criticized of using the lawsuit against MtGox as a PR tactic. It could be argued that Murck was used as a pawn and as a means to suggest that it was the Bitcoinica Consultancy which was not cooperating instead of Wendon Group.https://bitcointalk.org/index.php?topic=95795.msg1063269#msg1063269
*AUG mid 2012 – Bitcoinica Consultancy realize that newly surfacing rumors may be true and that Tihan actually owns Wendon Group, that the lawyer Andrew Thornhill quit representing Wendon Group, and that Wendon Group isn't the large investment group it claimed to be. It is one of the few explanations for why Tihan continues to say that he is employed by Wendon Group. It is possible that Bitcoinica Consultancy were far more in the dark than even many Bitcoinica claimants.
* AUGUST 1 - Tihan makes "OPEN LETTER..."
Despite the fact that Bitcoinica Consultancy has been trying to contact Wendon Group since at least June 9th, Tihan writes an open letter suggesting that Wendon Group has been contactable and has been trying to get in touch with Bitcoinica Consultancy. This can be seen as another effort to show Bitcoincia Consultancy that Tihan Seale is willing to destroy their reputation in hopes that this will push Bitcoinica Consultancy into acting while allowing Wendon Group to remain unlinked. The reader can forward all the way to a post made by Tihan on September 13. This post is a petition to liquidate Bitcoinca. Please notice in his letter that while Donald, Patrick and Amir's names are under the signature feild, there is no name associated with Wendon Group.https://bitcointalk.org/index.php?topic=97272.0
*AUGUST 8 - Tihan's friend(s) sue https://bitcointalk.org/index.php?topic=99222.0
* SEP 13 2012 – Tihan makes the post referenced earlierhttps://bitcointalk.org/index.php?topic=109316.msg1189028#msg1189028
* OCT 31st 2012 Bitcoinica enters liquidationhttps://bitcointalk.org/index.php?topic=121474.0
For the purposes of this post this will be the end of the timeline although there will be commentary below speculating on the current happenings with MtGox. The timeline will continue to be updated with citations or fixes as they come. Again, I hold that the general idea is true and I believe the very large amount which is citationed already shows holes in Tihan's story. It also shows how deplorable Tihan, Wendon Group, Roger Ver and Jesse Powell have acted.
I understand that Roger Ver and Jesse Powell (like Bitcoinica Consultancy) have also been victims in this situation. I also understand that Roger Ver has contributed significantly to bitcoin in recent years. These do not excuse his behavior. Amir and Patrick have been attacked for being callous towards them. These are regrettable mistakes brought on by things such as the threat of frivolous litigation, extortion, fraud, slander among others.
Public knowledge that was discovered in the following few months:
*Wendon Group had/has a secured loan of $100,000 against bitcoinica. This was unreported to the Bitcoinica Consultancy. While this information is in the public records I am not sure at this time how to access it or if it's even accessible online. For all I know it may require going in person to Barbados.
*There was a transaction between Wendon Group and Ator which was also unreported to Bitcoinica Consultancy. Tihan Seale is or was the director for this company. Despite Ator being a NZ company, one of the listed locations is Barbados.http://businessprofiles.com/details/ator-limited/NZ-2123704/tihan-seale
There may be some questions that are still unanswered. I do not have the answer to all questions but hopefully this will answer some of them.
* Why is this information being released now?
If Wendon Group is continuing to fail in providing documents this is not something that will change now. If Tihan is the exclusive owner of Wendon Group and has not associated himself publicly, not much can be done. If, in fact, Tihan is trying to find a lawyer (who can legally keep his confidentiality perhaps, or at least who will professionally) in Barbados then he will either do so or fail to do so.
* Why did Bitcoinica Consultancy not want Zhou Tong to lead the refund process?
While Zhou Tong was not seen as a thief, he was not trusted to make the best decisions and despite many people being vocal on bitcointalk suggesting that he lead the refund process, Bitcoinica Consultancy did not think it was a good idea.
*. Why did Bitcoinica Consultancy take so long to put the company into liquidation?
I am not exactly sure the specifics of what was necessary to put the company into liquidation however an impartial liquidator was desired by the Bitcoinica Consultancy instead of one which may have been picked by Tihan Seale.
*. Why was there no response to Tihan's 'Open Letter'?
By the time of Tihan's open letter, the Bitcoinica Consultancy was already aware of Tihan's past and his intentions. Publicly arguing with Zhou Tong had not been successful. Sociopaths have an arsenal at their fingers. Those who limit themselves to the truth and to acting within ethical standards are by definition disadvantaged. There was also still hope that Tihan would make a mistake an somehow associate himself with Wendon Group. This may have allowed users to personally sue him. The more Bitcoinica Consultancy understood Tihan, the more afraid they were of him as well. Now that people are questioning his associate Peter Vasseness and Coinlab, an owner of the Bitcoinica Consultancy thought it was appropriate to release this information publicly as it might actually have some effect.
*. Rodger Ver continuously pointed to an offer to buy out Bitcoinica, why was it not taken (especially when it was obvious that Bitcoinica would enter liquidation)?
There are many reasons for this
- Bitcoinica Consultancy was uncertain whether they had the authority to make any such deals
- Such a deal would require that they be public about the missing funds, the publication of such a fact would make Wendon Group less likely to become unveiled. At the time it was also unsure if this would be a breach of NDA. They also believed there was a good chance that liquidation or simply bitcointalk sentiment would force Wendon Group to be a less veiled company.
- The people offering the deal did not seem to have the best intentions for bitcoinica users. It would have been unethical and possibly illegal to make the deal for the following reasons.
- Such a deal may not benefit bitcoinica users if it allowed Wendon Group to be less transparent
- Rodger Ver and his friends are/were friends with Tihan who was not acting ethically. None of those offering the deal were truly demanding basic things from Wendon Group such as basic transparency.
- Rodger Ver, Jesse Powell attempted to extort Bitcoinica Consultancy repeatedly demanding that they be unfairly rewarded over other Bitcoinica users. While complying with such actions would have saved the members of Bitcoinica Consultancy from frivolous litigation and slander it would not have been the ethical thing to do.
-Jesse Powell threatened frivolous litigation
*. Why was the source code leaked?
- Leaking the source code was a regrettable mistake by Amir who acted alone. It was not done with knowledge or consent of Patrick or Donald. Amir leaked the code in an effort to expose that Tihan had lied in the hopes that this knowledge would cause Tihan to come back to the table and see the bitcoinica issue resolved in a manner fair to the Bitcoinica users. The source code itself was made by Zhou Tong in 5 day's time and it was already agreed by Tihan and others that the code would not be used again due to it's liability (at this time it was not even suspected that Zhou Tong could have been responsible for the hack). Needless to say, the source code itself did not have any true value and those saying that the leaking of the source code was an asset loss to Bitcoinica are generally the same people who have yet to say a harsh word towards Zhou.
As shown in this thread the people threatening litigation have no interest in whether Bitcoinica Consultancy is in the right or the wrong. They never criticized Zhou Tong and they made little attempt at nullifying the NDA. They have acted in a way such as to better their position in relation to other bitocinica claimants and they are the friends of Tihan Seale. The plaintiffs are also connected with a plethora of litigation and reside in a country where it is not too uncommon for people to make a profession of litigation. It is also not too uncommon to use frivolous litigation as a means of eliminating business competition (something Donald Trump is accused on regularly).
Things to confirm
I have compiled a small list of points that readers may like to confirm. It is easy to find things that were said, however, it is hard to prove things were not said (especially if that person could have written it on a different forum). If you can contradict any of the statements please let me know:
1. Tihan did not say that money was missing even though he is shown to have been active with bitcoinica leading up to the hack.
2. Tihan did not really say anything against Zhou despite being flagrantly aggressive towards the Bitcoinica Consultancy.
3. Rodger Ver did not say anything against Zhou despite being flagrantly aggressive towards the Bitcoinica Consultancy.
4. Jesse Powell did not say anything against Zhou despite being flagrantly aggressive towards the Bitcoinica Consultancy.
5. Can Theymos or anyone who may have archived the post find Tihan's deleted a post where he says that Bitcoinica Consultancy was lying about him being fired?
6. Is there a single person associated with Wendon Group as an owner or operator who was associated with Wendon Group before the hack that is not Andrew Thornhill or Tihan Seale.
7. It is very possible Tihan is/was telling the truth about meeting Zhou in person. When asked for confirmation he posted that "Zhou Tong is exactly who he says he is." To me this sounds like a way of not confirming if he has met Zhou Tong and I cannot believe that users would be satisfied with this answer which is a perfect way to provide plausible deniability. The specific province in China where he is said to have met Zhou Tong is said to stamp your passport. This would be nice to finally confirm.
MtGox and the Bitcoinica Liquidation (Largely speculative section)
I do not claim to know what is going on at all with MtGox and the Bitcoinica liquidation. This section is just speculation. However, it scares me how much of a witch hunt is going on for MtGox and I wonder if MtGox is undergoing the same treatment that the Bitcoinica Consultancy received and if those criticizing MtGox are simply doing the bidding of Tihan Seale and his friends.
Amir Taaki, under the bitcointalk account genjix, made a post recently which exemplifies the ignorance and destructive tendencies of groupthink. He brought to light information that was already mostly known to show attempt to justify his actions. Many users verified what he said and realized that there was no proof he was acting against the interests of Bitcoinica users. At least one user who had been very cruel to him for a year now (Goat) quickly changed his tune. In the very same thread he starts aggressively attacking MtGox despite no evidence that MtGox is actually slowing down the process (it's possible but I think it is not the most likely possibility). Goat may have gone from doing the bidding of Tihan for the last year to doing the current bidding of Tihan. The user Goat is an extreme example of posters who think they are fighting the good fight only to be pawns for the people who are willing to say any lie. While users like Goat are not common they can be highly vocal and influence other people. I believe Goat has good intentions however I kindly ask him to question his methods.
I do not support or agree with all the past decisions and history of MtGox but I can certainly see a scenario where they indeed have not been provided the proper documentation because:
1. Tihan is trying to find a lawyer willing to be a director of Wendon Group but lawyers in Barbados do not wish to get involved with the company after searching Wendon Group on Google.
2. Tihan is content to simply have Wendon Group itself liquidate or remain idle with potentially no record of ownership. It is possible that Mr. Thornhill can be forced to provide an account of his relationship however I think getting a lawyer to break client confidentiality in a foreign country may be impossible.
3. This might be a leap of logic but who knows, maybe the plaintiffs in the California case are requesting Tihan be slow. If they are successful with their lawsuit they may receive more in compensation. If the liquidation completes while the lawsuit is still in process the judge may throw out the case or at least certainly limit the damages. I don't actually think this is likely but maybe more likely than MtGox simply not cooperating for no truly explainable reason.
Coinlab and MtGox (Again this section is pure speculation)
Now I don't claim to know what is going on exactly with Coinlab and MtGox either or to even know much about Coinlab so please let me know and I will change this section accordingly if there is evidence or good reason that I am wrong.
I saw Coinlab as a company who had never really done anything. Then they received $500,000 in seed funding to build a game which seems to be borderline unethical. The game would generate revenue by having users GPU mine instead of paying an upfront price. This was at a time when GPU mining was close to unprofitable if not unprofitable (please do not confuse miner profits which were actually from speculation and not mining and please let me know if I am wrong about this). I can imagine people agreeing to a long terms-and-conditions and then wonder why their electricity bill is so high.
Coinlab are associated with Tihan Seale who was sued for fraud among other things, before bitcoin even existed. The company which sued had revenues in the billions http://www.wiwd.uscourts.gov/opinions/pdfs/2003-2005/05-C-368-C-11-04-05.PDF
). http://www.geekwire.com/2011/coinlab-center-bitcoin-projects-created-seattle/ http://www.geekwire.com/2012/bitcoin-startup-coinlab-lands-funding-tim-draper-monetize-games/
Then, a while ago, after Coinlab failed to really produce anything as far as I know (please correct me if I'm wrong and I will update the post), we hear that Coinlab has signed a deal with MtGox. Now presumably if MtGox planned to handover Coinlab access to a userbase and business valued at $75 million. Speculation on bitcointalk suggests that this was in return for guaranteeing compliance in the US. Whatever the reason, I am sure the contract was not meant to be so one-sided. If Coinlab promised something they could not reasonably deliver, or maybe if Coinlab falsely represented themselves as Tihan has in so many occasions (including lying to a judge claiming immunity) I simply find that it is more likely that this is where the problem stems from.
I want readers to not discount the possibility that MtGox and their lawyers may have uncovered some fraud on the side of Coinlab. I also believe MtGox's silence is simply a product of them dealing with people who may abuse the legal system for gain. If you think the US legal system is impervious to such abuse or that such abuse is not profitable please google Donald Trump and frivolous litigation.
A section on Denial
The detail of abuse that this post shows may be unfathomable to imagine. This however does not make it any less true and this type of activity may be much more common that the general society think.
The wikipedia for 'Denial' has a section called DARVO, a common 'denial strategy' which I feel is applicable to how Tihan and his friends have acted and 'might be' acting in regards to the MtGox situation.
Harassment covers a wide range of offensive behavior. It is commonly understood as behavior intended to disturb or upset. In the legal sense, it is behavior which is found threatening or disturbing.
DARVO is an acronym to describe a common strategy of abusers: Deny the abuse, then Attack the victim for attempting to make them accountable for their offense, thereby Reversing Victim and Offender.
Psychologist Jennifer Freyd writes:
...I have observed that actual abusers threaten, bully and make a nightmare for anyone who holds them accountable or asks them to change their abusive behavior. This attack, intended to chill and terrify, typically includes threats of law suits, overt and covert attacks on the whistle-blower's credibility, and so on. The attack will often take the form of focusing on ridiculing the person who attempts to hold the offender accountable. [...] [T]he offender rapidly creates the impression
that the abuser is the wronged one, while the victim or concerned observer is the offender. Figure and ground are completely reversed. [...] The offender is on the offense and the person attempting to hold the offender accountable is put on the defense.
MTGOX and RECENT MTGOX happenings (Again, speculative section)
I am not a supporter of MtGox and do not agree with all of their methods. It is also true that their current difficulties may have a positive effect on bitcoin. If MtGox losses market share then a simple DDoS on a domain will no longer cause serious price fluctuations.
This aside, there are many that speculate that Coinlab has attempted or lobbied the Department of Homeland Security to take measures to prevent MtGox from conducting business in the US. Obviously, I have no idea if this is true or not. I highly doubt that the DHS would take such measures if there was absolutely no issue with MtGox's operations.
I also cannot comment on the theory that the huge sell off before the announcement of the Coinlab lawsuit was insider trading and or market manipulation by Coinlab.
What I do know is that Tihan and his friends seemed to have turned the bitcoinica fiasco into an opportunity with Kraken and their Bitcoin2013 conference where Tihan is on the list of panelists.
Tihan's description reads:
“As an entrepreneurial investor, Mr. Seale spends his days mapping opportunities at the boundary of tech and finance. He first caught the decentralized currency bug at a poker game. Now his kids get their allowance in bitcoin.”http://www.bitcoin2013.com/bitcoin-2013-panelists.html
We might sometimes be fortunate enough to forget the reality, but there are unreasonable people. The world is full of them and sadly, the bitcoin world seems to attract them disproportionately higher. You might be reading this very post from the bitcoin conference organized in large part by these abusers.
Amir, Patrick and Donald were instrumental in spearheading such conferences. Doing so I believe at a financial loss. They were thinking to the future and they are crushed by the aspect that their hard work in a large part benefits people like Tihan Seale whose sociopathic strategy had given him a clear advantage in business.
The Bitcoin Conference was just a small part of the projects these three were associated with. Projects to which they devoted 2 years of their live and years of savings. By the time of the lawsuit, not a single project had been profitable as all their efforts were invested in the future. The three started their projects living and working out of a 2 bedroom apartment in Poland until they were no longer able to support (due to savings running out) and 2 of the 3 members began living with their parents while another member lived in cheap countries where only a very modest salary is enough.
Patrick's mother has sacrificed a very significant amount of money helping him fight his current liquidation. She is a single mother and I would estimate that she has spent half a year's after tax salary on this case. The effects of the abuse have caused stress, health, diet issues, and obvious financial problems for everyone involved. It hasn't only been a cost though to these individuals but it's been a cost to bitcoin itself due to the degradation of services that these people were associated with.
Postscript: This information has been gathered directly from a knowledgeable party. I am friends with him and have extensively talked with him. Much of what is written here are his direct words and an earlier draft of this post was checked and partially edited by him. I admit due to the size of this post, I expect there will be an error or two however I am sure they will not alter the general sentiment. I wish to remain unknown because I simply do not want to get caught in the cross-hairs. If you have managed to read all this than I thank you for your time and patience.