Full Blown MtGox Audit - Get Ready To participate. Starting Sept 25th

[JonHind]

While I took everything I had out of Mt:Gox over the past couple of weeks, I have many friends who are still trading there. One just messaged me to say that his account was blocked as he was trying to offload his BTC's and jump ship.

I then see this posted on SA from the mtgox irc channel:

17:35 < molecular> flushing bad orders? How do I make a "bad sell order" at 30 USD? ^^
17:35 < xelister> molecular: =)
17:35 <@MagicalTux> molecular, I blocked ~2000 accounts created most likely for the purpose of killing bitcoin on 9/11
17:35 <@MagicalTux> their trades do remain however
17:35 < molecular> MagicalTux, holy moly!
17:35 <@MagicalTux> but they cannot execute, causing weird results

2000 accounts blocked? How can he be sure that innocent people who just wanted to trade BTC's in this volatile market are not caught up with this mass blocking? Will MtGox be held financially liable for any losses that these people incur should the $ price of BTC drop during the account freezes?

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[Gandlaf]

I don't want to harm MtGox or BitCoin; however, there is not even a public policy on Marc's website about fractional reserve banking and methods of ensuring that through audits to the public. This is an opportunity for Marc! I hope he embraces it and finds me as a friend not an enemy.

You are advocating a bank run on his company.  Why in the world would he find you as a friend?  If I were him I would want to punch you in the face.

You come in with 14 posts and are already advocating the destruction of one of bitcoin's main pillars.  Why would anyone treat you as a friend?

MtGox fanboy much?

[cypherdoc]

I don't want to harm MtGox or BitCoin; however, there is not even a public policy on Marc's website about fractional reserve banking and methods of ensuring that through audits to the public. This is an opportunity for Marc! I hope he embraces it and finds me as a friend not an enemy.

You are advocating a bank run on his company.  Why in the world would he find you as a friend?  If I were him I would want to punch you in the face.

You come in with 14 posts and are already advocating the destruction of one of bitcoin's main pillars.  Why would anyone treat you as a friend?

MtGox fanboy much?

MtGox troll?

[JonHind]

More was posted from the irc channel onto SA (it is a great thread for monitoring what is going at the moment):

17:31 < kinlo> there is something wrong, how can it have gone above 10 when my sell order at 8 didn't occur?
17:31 < molecular> it didnt reall go above 10, I assume
17:31 < Ymgve> kinlo: bugs, the orders didn't happen or there was something wrong in the matching algorithm
17:32 < kinlo> MagicalTux: ?
17:32 < molecular> likely has to do with the "new currency markets"
17:32 <@MagicalTux> no
17:32 <@MagicalTux> has to do with hackers trying their best to do stuff normal people wouldn't by dropping large amounts of stolen funds/coins

Question: How does Marc know that these funds are stolen, and when he talks about hacking, is he talking about Mt:Gox being hacked?

[Gandlaf]

I don't want to harm MtGox or BitCoin; however, there is not even a public policy on Marc's website about fractional reserve banking and methods of ensuring that through audits to the public. This is an opportunity for Marc! I hope he embraces it and finds me as a friend not an enemy.

You are advocating a bank run on his company.  Why in the world would he find you as a friend?  If I were him I would want to punch you in the face.

You come in with 14 posts and are already advocating the destruction of one of bitcoin's main pillars.  Why would anyone treat you as a friend?

MtGox fanboy much?

MtGox troll?

Not really, if you´d bothered to read geek-traders comment, if MtGox is run purely as an exchange, there can´t be a bank run by definition/it would not do any harm. Threatening violence "punch you in the face" and the "one of bitcoin's main pillars" defence, where did I hear that last? oh yeah, the last two MtGox issues, mybitcoin and lately the unsavioury Bruce Wagner/onlyone.tv discussion.
Not that you have missed a beat in actively defending all of these either...
But go ahead, call me a troll.

[allten]

I don't want to harm MtGox or BitCoin; however, there is not even a public policy on Marc's website about fractional reserve banking and methods of ensuring that through audits to the public. This is an opportunity for Marc! I hope he embraces it and finds me as a friend not an enemy.

You are advocating a bank run on his company.  Why in the world would he find you as a friend?  If I were him I would want to punch you in the face.

You come in with 14 posts and are already advocating the destruction of one of bitcoin's main pillars.  Why would anyone treat you as a friend?

A BTC bank run on an organization that is 100% funded (both btc and all currencies) with lots of profits should absorb it just fine because they have 100% of funds available. If this is successful and everyone gets there money out and there's been no indication of market manipulation then I will defiantly increase the amount of reserve and amount of trading I do with them. Like I said before, they should embrace this opportunity. The short-term loss would not even compare with their long term gains and the increased confidence from the market they would receive.

[hmongotaku]

If Mtgox is alllowing bots to trade massive amounts of .25 btc etc... millions of MICRO trades to lower the value, I support this effort! There's already like 50+ threads relating to manipulation of the market by xx parties.

[repentance]

All of the exchanges should be audited by an independent third party on a regular basis.  What the OP has proposed could create a false sense of security given the likelihood that many people won't try to withdraw their money/BTC - it's not going to conclusively prove than the exchange has enough on hand in segregated funds to cover 100% of user deposits.

[casascius]

"SAS 70 Type II or equivalent" is the magic thing to ask for if you want any meaningful results!

[DonnyCMU]

MtGox has been great for Bitcoin.  Why would I punish them by using other exchanges?

Are you serious?
just look in the trading activity in the past 24 hours and think about if this is what an exchange should be doing.

[cypherdoc]

MtGox has been great for Bitcoin.  Why would I punish them by using other exchanges?

Are you serious?
just look in the trading activity in the past 24 hours and think about if this is what an exchange should be doing.

i hear the panic in your voice as the Bitcoin price rises.

[322i0n]

how would this boycott prove anything? removing your funds won't prove anything. it would not make sense for mt gox or any other large exchange to leave all funds online and accessible all the time. I don't get it.

[Gandlaf]

"SAS 70 Type II or equivalent" is the magic thing to ask for if you want any meaningful results!

Not an accountant, but wouldn´t you need a SAS 55 too, to be sure? Also, from what I remember, isn´t this standard geared towards nonfinancial companies rather than financial organizations? In how far does this apply to MtGox, given that they are based in Japan, given that it is a US standard? What would be the japanese equivalent to ask for?

[Littleshop]

I will not be removing my coin from mtgox, and I am sure many others will not as well.  

[cypherdoc]

how would this boycott prove anything? removing your funds won't prove anything. it would not make sense for mt gox or any other large exchange to leave all funds online and accessible all the time. I don't get it.

you're not supposed to "get it".  he expects you to mindlessly go along with his hair brained proposal.

[johnj]

I'm okay with an audit.

However, convincing everyone to remove their money on X day for Y period is the most inefficient way I can think of doing it.

[ctoon6]

whats wrong with this idea? i think its a good idea, mtgox should not be doing FRB, but i think 2 weeks if a bit much, maby 3 days?

[allten]

All of the exchanges should be audited by an independent third party on a regular basis.  What the OP has proposed could create a false sense of security given the likelihood that many people won't try to withdraw their money/BTC - it's not going to conclusively prove than the exchange has enough on hand in segregated funds to cover 100% of user deposits.

That's a good point.
Thanks.

I still hope people consider the proposed audit. If not, please provide a better solution.
A full transparant audit is neccessary and I would at least hope that everyong agrees with that.

[allten]

I will not be removing my coin from mtgox, and I am sure many others will not as well.  

If many choose not to then yes it would render this audit uneffective.
what proposals do you have for a full transparant audit?
I do hope you see the need.

[cypherdoc]

i wouldn't mind an audit either.  my whole argument is how you're going about it.  the way you propose will damage mtgox and i can't understand how you can't see that.  or maybe you do.