Mt.Gox SCAM? $38million disappeared. Large sums affected.

[AndersAA]

As much as I dislike Mt. Gox for their serial incompetence and communication failures, they’re not insolvent or frauds. No evidence of that

A whole community speculating over what is going on over the weekend is not doing mtgox or the Bitcoin exchange rate any good... They really should release more progress reports if they want to regain some trust - even if they get it up Monday and are ready for a bezillion withdrawals.

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[disclaimer201]

Damn this is why BTC value is dropping...
Why now??? I know I'm just starting a big invest in mining material...

I really have no luck with timing.

It will go back up. The problem is not bitcoin itself but one of the exchanges. People selling now are mostly those running away from gox. They want to switch to fiat so in case Gox goes to hell they can at least sue them for currency theft. Whatever happens to Gox the price will recover eventually, the investors will just move to other exchanges.

If Gox does go down it would make the mainstream media news first and that would throw back adoption for months to say the least. This is why the price is already going down right now.

[MicroGuy]

Perhaps they're hoping bitcoin finds a bottom this weekend thus insuring fewer customers will make a run on the MtGox wallet when withdrawals are re-enabled on monday.

[R2Pleasent]

To me, it doesn't make much sense that MtGox is actually insolvent and ran out of BTC.  If they are truly spending customers' funds, what is the point?  Did they really think this could continue indefinitely?  I just don't believe they are so foolish to use all customers' BTC.

The only logical scenario I can think of to justify their spending is that they lost so much money from the government investigation, they were forced to dip into BTC funds in order to pay their fiat debts.  Because BTC prices on their site became so much higher, the amount of people actually depositing fiat continued to decrease.  Why would someone put their fiat on Gox to buy BTC at 15-20% higher rates than Bitstamp?

It's still a bizarre situation.  If this company was truly able to go bankrupt, it means they acted extremely unethically.  Based on the fees accumulated and low overhead costs involved in such an organization, there is no justifiable reason for them not backing the deposits on their service.  There is no justifiable reason that Mt. Gox should have anything less than 100% reserve of every single user's deposits on hand.

[wayneyoyo]

Apparently, $38million of clients' money has disappeared from mtgox. Was mtgox hacked? Or did they steal the money to keep themselves afloat?

Source :: http://falkvinge.net/2014/02/04/major-bitcoin-exchange-not-executing-withdrawals-now-owes-clients-38m-in-disappeared-money/

Mtgox support has agreed to this and say this affected only the larger transactions (ofc it did).

Mtgox support reply :: https://support.mtgox.com/entries/26128504-Update-Statement-Regarding-BTC-Withdrawal-Delays

Mtgox better come clean about this soon or the BTC price is gonna keep doing down. Fell $100 in just the past 3 hours.

New Press Release from Mtgox (dated 7th Feb 2014) ::  https://www.mtgox.com/press_release_20140207.html

Mtgox has officially stopped all withdrawals. This is not looking good. So we got all our money stuck at a japanese exchange now  

Is that the reason bitcoin droped so much ?

[brokedummy]

The only good thing about this situation is that now Mtgox is the most secure wallet in the world, in fact it is 100%impossible for an hacker to take your money from your gox wallet.

I think I am going to put all of my btc on gox right now, I love such a level of security.

Just delete the private keys and save yourself the trouble.

[Sheldor333]

“I think just witnessed Mt Gox die today. I didn’t get my bitcoin, but glad I came and tried.” - Reddit user ‘CoinSearcher’, after conducting a three-day protest at Mt. Gox’s headquarters in Tokyo.
This is the best article I could find that explains it in detail. http://www.coindesk.com/mt-gox-first-bitcoin-exchange-dead/

[DaFockBro]

Does anyone even use mtgox anymore besides newbs?

I thought it was already well known among crypto enthusiasts to not trust mtgox?

[Phishin_ca]

Why would they keep their API up through this if they did not want the price to fall?

[P_Shep]

Something's going on...

My public address (that one down there), I put the private key into mtgox. I had my reasons, and the risk was small given that it rarely sees any funding!
Anyway, it's been collecting dust over the past year, really small amounts. Up until today they've just sat there. All of a sudden, today, this dust has been swept up by mxgox.

I find this interesting.

[flipstyle]

I'm just pissed the coinbase asking rate has been stuck at 698 all damn day.  Seems as though they're hedging quite a bit.


Give me btc at 650 and I'm a buyer!

[gollum]

Is it possible that MtGox is applying the classical "Fractional Reserver Banking" and they are experiencing their first "Bank Run"?

A theory:
They assumed most people won't withdraw their fiat or bitcoins, so they sold bitcoins they didn't have to their clients.
They maybe had 10-20% of all bitcoins they sold to clients, but they didn't expect the bitcoin price to rise so much and so quickly...
Maybe part of the huge rally from 200$ to 1200$ was due MtGox need to cover for all the bitcoins they sold but didnt have?

[CompNsci]

I think if this is the case and the banks and the governments are tying up their bank accounts it would be in the best of interest of MtGox to explain themselves as things could turn around more in their favor, instead of giving people their bullshit.

One of the biggest problems which Mt. Gox has, in addition to technical incompetence, is a lack of transparency about what is going on.

[doom309]

ive never had my btc in gox, but im really feeling for those people stuck in there now, its tragic ...  whats our wonderful bitcoin foundation saying about this anything ??

[doom309]

Is it possible that MtGox is applying the classical "Fractional Reserver Banking" and they are experiencing their first "Bank Run"?

A theory:
They assumed most people won't withdraw their fiat or bitcoins, so they sold bitcoins they didn't have to their clients.
They maybe had 10-20% of all bitcoins they sold to clients, but they didn't expect the bitcoin price to rise so much and so quickly...
Maybe part of the huge rally from 200$ to 1200$ was due MtGox need to cover for all the bitcoins they sold but didnt have?

my thoughts exactly, historys first crypto bank run ...

the more things change the more they stay the same

central banking at its best

[disclaimer201]

ive never had my btc in gox, but im really feeling for those people stuck in there now, its tragic ...  whats our wonderful bitcoin foundation saying about this anything ??

They are a waste of time.

[doom309]

Please have some common sense.  These fraudsters plain out robbed people of $38 million because they knew they could get away with it.  The only theft that occurred was an internal theft at their own hands.  All the $$$ they were getting from the transaction fees and artificially manipulating the price of Bitcoin wasn't enough.  Greed will be the downfall of this movement not the regulators.


Thankfully, as soon as I saw the $100 discrepancy between MT GOX and the rest of the exchanges back in December, I knew something was off and stayed the hell away from GOX.  

mt goldman sachs

[igorr]

Countdown is begun,

Tokio/Japan GMT, 23:55
Peking/China  GMT, 22:55

[aesma]

A bank run is scary because the bank can't pay everyone, so you want to be first in line. Gox should have all the money/coins, so even if 100% of users want to cash out, it should be possible without trouble. Of course, in practice cashing out has been almost impossible for months so I don't see how a bank run could happen, there is nowhere to run to or from ! The first in line have cashed out long ago.

[NutCoin]

This is why you should never keep all your coin in one place in an emerging market like this.

Someone with industry experience needs to come in and lead the way - bitstamp.net seems like a good alternative.