irc Chat with KARPELES(MtGox) from today 25th Feb

[EvilPanda]

And who brings a cat to his office, he thinks he's Blofeld? 

He was at home, not at an office, btw.

https://twitter.com/MarkKarpelesCat

Haha don't mess with the internet people 

[Entropy-uc]

Are everybody just gone INSANE??

I hope you all know he is talking about his own wallet (unavailable), not the one from the company.
Mark just verified that MtGOX lost 700k BTC. Why is price shooting up?

Don't friggen tell me that's actually a good news 

It is good news.  700k imaginary bitcoins have disappeared.  Many many people have been trading with this imaginary coins, depressing the price.  Now that the fraud is revealed, real supply and demand can take hold again.

Plus, an inept, and potentially criminal service has been removed from Bitcoin.  From here we can move forward with more competent operators.  And the lessons learned here will force people to be more diligent about the integrity of the services they use.

Thats what I was thinking- maybe 700K weren't actually lost but some number of those are imaginary.

All of the lost coins were imaginary.  There is a very important point to grasp here so let me expand upon the idea for a moment.

The missing coins reported is the difference between the real BTC in the control of MtGox and the BTC balances held on account by users of MtGox.  As soon as those 2 numbers were not equal to each other MtGox starting being a service where imaginary BTC changed hands.  From the leaked documents it's clear there has been a deficit of BTC in hand versus BTC obligations to customers at MtGox for many years (I have been posting here for years that I suspected this was the case).

It really doesn't matter why MtGox arrived at the point where they owned less BTC than their customers believed were on deposit with them.  As soon as that situation developed MtGox was operating a fraud.  And it is beyond belief that they would not be aware of the shortfall.  Comparing BTC holdings to BTC obligations should have been the most trivial of database operations, and one that was done hourly.

Mark can wave his hands about flaws in the protocol all day long.  It doesn't change the fact that he was operating an insolvent company fraudulently for years.  I expect he is going to spend significant time in prison. (I also expect he will leave prison with a hefty number of those 'missing' BTC in his possession).

[theomar]

Karpeles has a lot of bitcoins. He is an early adopter and he was running one of the biggest exchanges. He must have more than 100k btc for himself in cold storage which was not related with mtgox. He is not an idiot he is told to pretend it. For sure a lot of bitcoins may have been lost but the problem here is the trust. If mtgox enable bitcoin withdrawals and the 550k costomers or a portion of them loose trust and try to sell their bitcoins then the price will go down down down... So the best strategy for him and for big investors is to claim that all btc had been lost if the majority eat that manipulation. The "leaked" document and the irc conversion is for testing reactions.

Pure manipulation...

[gollum]

I've heard all kinds of speculations, but the problem could be very simple:
MtGox sold coins they did not have in the first place, that's the only reasonable solution to the 750,000 lost coins mystery.

Further BTC-price crash is the best solution for the MtGox crisis:
people sell their imaginary coins for around $80-$100 back to MtGox, which will make MtGox solvent again.

[Sukrim]

I've heard all kinds of speculations, but the problem could be very simple:
MtGox sold coins they did not have in the first place, that's the only reasonable solution to the 750,000 lost coins mystery.

Another simple solution:
They overengineered their deep cold wallet stuff (e.g. splitting keys up and store the parts seperately in several places) and ran on hot wallets/"warm" wallets (keys in office safe) for a long time. Now that they need to access the deep vaults, they are not able to piece the keys together agian, locking up their old coins forever. Think of it like restoring a RAID-5 and a second HDD failing while the restore is running...

[Tombstone]

I'm surprised you all are so surprised! Seems pretty apparent to me why Mark is so casual about all that money you lost..  The guy started an exchange for Bitcoins when they were worth practically nothing. All of the sudden his system gets slammed, the bitcoin he now is responsible for is worth millions.. it was just a Magic the Gathering trading website. For you "investors" that is a fantasy game some of us anti social people play that allows us to be POWERFUL WIZARDS. In the game you keep your cool when making moves to win. When I see mark, I see a hundred other anti social, intelligent people playing magic. His mistake was not seeking help when the fire started..  but can you expect more? This is a game that turned real, some aren't equip to make that transition from fantasy to reality. If anything his con was putting up all that marketing material that made his company seem prepared and credible. He should stand behind the marketing promises. If the the ID numbers were changed as a fix by other nodes and the Gox database of coin owners is scrambled someone needs to get in their and do the work to trace the black chain and restore the ownership of those "lost" coins. Shutting down the mess seems a good way to start unraveling the mess. Mark you get an F for not hiring a PR person.

[Sukrim]

Cute, a newbie who thinks Mark started MtGox and who repeats the MTG:O X story that somethingawful was so proud of "uncovering".

[Tombstone]

Cute, a newbie who thinks Mark started MtGox and who repeats the MTG:O X story that somethingawful was so proud of "uncovering".

I didn't lose any of my coins in Gox so I'm ok with being called cute. The big "uncovering" is that people are acting like Mt. Gox was fort knox, which it should have been but couldn't have been expected to be considering it's long history of negligence. It's those assumptions that always get you.

[solex]

I've heard all kinds of speculations, but the problem could be very simple:
MtGox sold coins they did not have in the first place, that's the only reasonable solution to the 750,000 lost coins mystery.

The other possibility is that spammer's duplicate transactions using tx malleability caused their db to fail to store the private keys properly for newly generated addresses, and it got out of sync with the blockchain for address balances. So now they are frantically trying to recover the keys from backups etc, to see how many coins are permanently destroyed. Maybe there will be enough left to open a cafe.

[vayvanne]

[10:58] <JonWickedFire> Is that Crisis Strategy Draft even legit?
[11:04] <MagicalTux> more or less

So...coins are not accessible?  Use your words Mark.

This sounds EXACTLY like weexchange/bitfunder

nsa guys on duty?

[jml]

Don't worry, Mark will put the keys back together... and it's gone! Poof.

http://goo.gl/gUaOl3

[Jeronimus]

The theory of them having lost so many coins on some not registered scam artists, when they were asking an arm and a leg for verification, only a few fools would buy.

Karpeles would have to BEG some of the trusted core devs like gmaxwell and others like antonopoulos to audit all the moves from the supposed cold store wallet to the supposed scam artists that supposedly stole it.

He of course does not do that, but instead represents us with an image of his cat.

He will also have to show us where he channeled all the USD and be audited by trusted members of the community. Again, he should beg for this, but instead he will keep sending us more pics of his cat and say sowwy.


Furthermore, as i explained several times, this prick has created probably WAY more BTC out of thin air than was ever stolen from this exchange supposedly.
This is the ONLY explanation why the price on MtGox went down to 91.5 USD when other exchanges were at 500-650. Only a few insane fools would have sold at this price, certainly not enough to push the price so far down.

He even kept asking for more deposits to fraud people out of there money during that time, as well as getting more real BTC into his hands via the builder tool that allowed people to interchange fake goxBTC for real BTC.

He also created insane amounts of fake USD/IOUs simply by entering a few numbers in the MtGox databse is my believe when looking at the sharp swings.


All this has to be investigated, and see WHERE TO he channeled all the REAL BTC and USD and WHEN EXACTLY he did that and WHO got hold of it. We might be able to figure out SOMETHING even if he used a mixer service to try and conceal the tracks.


Furthermore, if they "just" lost the passwords to the cold storage, and they can without doubt prove that it is THEIR cold storage, i am pretty sure the core devs in agreement with the community could release an updated client which gives them back the control over those coins, or even if i am wrong, this would have been a POSSIBLE way to save them he should be seeking to make it happen.
Of course this prick does not do any of the above, so i am convinced that this theory some put forward is out of the way as well. He does not even attempt to do anything in this regard.


His only thoughts now are how he will be able to get away with some new identity and possibly a surgical face-lift which will change his appearance so no one will recognize him after, along with some diet to lose weight, all sponsored by the powers that want to harm BTC.

[jml]

The theory of them having lost so many coins on some not registered scam artists, when they were asking an arm and a leg for verification, only a few fools would buy.

Karpeles would have to BEG some of the trusted core devs like gmaxwell and others like antonopoulos to audit all the moves from the supposed cold store wallet to the supposed scam artists that supposedly stole it.

He of course does not do that, but instead represents us with an image of his cat.

He will also have to show us where he channeled all the USD and be audited by trusted members of the community. Again, he should beg for this, but instead he will keep sending us more pics of his cat and say sowwy.


Furthermore, as i explained several times, this prick has created probably WAY more BTC out of thin air than was ever stolen from this exchange supposedly.
This is the ONLY explanation why the price on MtGox went down to 91.5 USD when other exchanges were at 500-650. Only a few insane fools would have sold at this price, certainly not enough to push the price so far down.

He even kept asking for more deposits to fraud people out of there money during that time, as well as getting more real BTC into his hands via the builder tool that allowed people to interchange fake goxBTC for real BTC.

He also created insane amounts of fake USD/IOUs simply by entering a few numbers in the MtGox databse is my believe when looking at the sharp swings.


All this has to be investigated, and see WHERE TO he channeled all the REAL BTC and USD and WHEN EXACTLY he did that and WHO got hold of it. We might be able to figure out SOMETHING even if he used a mixer service to try and conceal the tracks.


Furthermore, if they "just" lost the passwords to the cold storage, and they can without doubt prove that it is THEIR cold storage, i am pretty sure the core devs in agreement with the community could release an updated client which gives them back the control over those coins, or even if i am wrong, this would have been a POSSIBLE way to save them he should be seeking to make it happen.
Of course this prick does not do any of the above, so i am convinced that this theory some put forward is out of the way as well. He does not even attempt to do anything in this regard.


His only thoughts now are how he will be able to get away with some new identity and possibly a surgical face-lift which will change his appearance so no one will recognize him after, along with some diet to lose weight, all sponsored by the powers that want to harm BTC.

A plausible conspiracy theory that is going around in twitter is that Mt.Gox was bought out by some Government agency and make it look like insolvent. This would bring about an outcry for regulation and tighter control. Plausible, but my guess is that he lost the BTC and has no way of getting it back.

[Phinnaeus Gage]

My crazy theory: JP Morgan buys MtGox for $1 and promises to pay all MtGox-clients with real money?

Are you talking about the JP Morgan bankers that committed suicide or the ones about to. BTW, in less than 24 hours from the date of the interview(?), Autumn Radtke is about to jump.

For those looking for clues as to why the interview(?) comes across as strange, perhaps there's hidden clues embedded somewhere:

[freedombit]

My crazy theory: JP Morgan buys MtGox for $1 and promises to pay all MtGox-clients with real money?

Are you talking about the JP Morgan bankers that committed suicide or the ones about to. BTW, in less than 24 hours from the date of the interview(?), Autumn Radtke is about to jump.

For those looking for clues as to why the interview(?) comes across as strange, perhaps there's hidden clues embedded somewhere:

Link to interview please?

[Phinnaeus Gage]

My crazy theory: JP Morgan buys MtGox for $1 and promises to pay all MtGox-clients with real money?

Are you talking about the JP Morgan bankers that committed suicide or the ones about to. BTW, in less than 24 hours from the date of the interview(?), Autumn Radtke is about to jump.

For those looking for clues as to why the interview(?) comes across as strange, perhaps there's hidden clues embedded somewhere:

Link to interview please?

It was in post #4 of this very thread, bud:

Looks like original is here...

http://www.wickedfire.com/shooting-shit/179038-my-conversation-mark-karpeles-mtgox-2.html#post2164682

[Phinnaeus Gage]

And for easy reference, here is the original IRC chat where Mark keeps mentioning pushing...

http://pastebin.com/Wb9p8VbX

Random fun fact: Nobody clicked on the Cat picture link from Feb 25, until March 15... same day the Gox data and chat in last post were leaked

Fun Fact #2: Has anybody try to see if there's a hidden messages in that cat photo that Mark keep referencing to? BTW, I DON'T believe that Orion and Tibane are the same cat.

"Thanks for coming in.. I know you're a bit.. shaken up and stressed.."

[10:53] <JonWickedFire> Yeah, you're in the future over there in Japan, lol.
[10:53] <MagicalTux> guys in NZ are even more in the future

[11:20] <MagicalTux> can't disclose that yety
[11:20] <MagicalTux> yet

[11:22] <JonWickedFire> The reason I'm asking is because after yesterday's events of you removing yourself from the foundation and deleting the Twitter account/posts and all.. right away speculation within the bitcoin arena went into hyper chaotic mode, and the word on the street was that you were closing up shop and running away with all of their monies and bitcoin...

<In ~48 from the time the twitter account was deleted, Autumn Radtke committed suicide(?)>

[11:24] <JonWickedFire> Mark, I know you're not one for expressing yourself, but here's your chance at it, because you really have stepped up before, and done things NO ONE else ever had.. or probably will again.. and it seems like all of it has been quickly forgotten and instead you're being labeled as the Madoff of bitcoin.

[11:37] <MagicalTux> (mostly because doing so could compromise our current efforts)
[11:38] <MagicalTux> imgur: the simple image sharer <- my cat pushing my keyboard, me pushing the keyboard back on the desk

[11:54] <MagicalTux> I should try to get some sleep
[11:55] <MagicalTux> already 2am
[11:55] <MagicalTux> waking up in 4 hours
[11:55] <JonWickedFire> Err
[11:55] <JonWickedFire> One more thing..
[11:55] <MagicalTux> and starting to be tired of pushing my keyboard so it stays on the desk

[12:07] <JonWickedFire> Anything else you'd like to say to everyone before all the pissed off people start going nuts, even more...?
[12:09] <MagicalTux> not really
[12:09] <MagicalTux> maybe just a link? something like that: Why do we fall? - 9GAG

[CompNsci]

Fun Fact #2: Has anybody try to see if there's a hidden messages in that cat photo that Mark keep referencing to?

Actually, BTC_Truth has suggested quite specifically that there might be something in the image file. I had a brief look at the hex dump, but nothing jumped out at me. Perhaps BTC_Truth can elaborate further?

[Phinnaeus Gage]

Fun Fact #2: Has anybody try to see if there's a hidden messages in that cat photo that Mark keep referencing to?

Actually, BTC_Truth has suggested quite specifically that there might be something in the image file. I had a brief look at the hex dump, but nothing jumped out at me. Perhaps BTC_Truth can elaborate further?

Did you check the original http://imgur.com/GqZr3N5 oppose to the one in my last post above? Not sure if it's password protected, hence highlighting 'yety' in red in case it was penned in code.

[freedombit]

Fun Fact #2: Has anybody try to see if there's a hidden messages in that cat photo that Mark keep referencing to?

Actually, BTC_Truth has suggested quite specifically that there might be something in the image file. I had a brief look at the hex dump, but nothing jumped out at me. Perhaps BTC_Truth can elaborate further?

Did you check the original http://imgur.com/GqZr3N5 oppose to the one in my last post above? Not sure if it's password protected, hence highlighting 'yety' in red in case it was penned in code.

Ah yes. The image of tibianne keeping a watchful eye on the keys.