[2014 - 2 - 15] With MtGox Dead, Bitcoin Enters Its Third Stage of Evolution

[BitGo]

https://medium.com/p/2d33cf85382b

By BitGo CEO, Will O'Brien.

"We are now entering the third stage, in which core financial infrastructure and services will be built by veteran entrepreneurs backed by institutional money, and in accordance with the regulatory framework of the United States and other nations. This stage will end with mainstream adoption of Bitcoin and consolidation of Bitcoin companies as large financial incumbents embrace digital currency."

"The fourth stage will begin when Bitcoin becomes a widespread medium of exchange and can be used to revolutionize industries outside of financial services, such as real estate, contracts, supply chain, and machine-to-machine commerce."

"The promise of Bitcoin is self-evident. The financial services industry has not seen much innovation over the last 50 years, and digital currency is poised to deliver 50 years worth of innovation in the next 18 months."

[howardb]

https://medium.com/p/2d33cf85382b

By BitGo CEO, Will O'Brien.

"We are now entering the third stage, in which core financial infrastructure and services will be built by veteran entrepreneurs backed by institutional money, and in accordance with the regulatory framework of the United States and other nations. This stage will end with mainstream adoption of Bitcoin and consolidation of Bitcoin companies as large financial incumbents embrace digital currency."

"The fourth stage will begin when Bitcoin becomes a widespread medium of exchange and can be used to revolutionize industries outside of financial services, such as real estate, contracts, supply chain, and machine-to-machine commerce."

"The promise of Bitcoin is self-evident. The financial services industry has not seen much innovation over the last 50 years, and digital currency is poised to deliver 50 years worth of innovation in the next 18 months."

Whilst I respect and believe in the multi signature technology you are promoting, I fail to see how it could have protected MT.Gox users from what was basically non-existant accounting audit practices. The theft from MT.Gox may have been going on for as long as two years!! and in all that time they failed to notice that the sum of their customer accounts did not come close to the sum of bitcoins in their hot and cold wallets!! That is incompetance of the highest magnitude, which was only multiplied by the incompetance of their software team failing to design/implement the Bitcoin protocol properly on their wallets.

[hilariousandco]

I'm not sure we can announce Gox as officially dead yet. I'd say it's in a coma and it's not looking good though  .

[LiteCoinGuy]

nice read, thanks.

[howardb]

I'm not sure we can announce Gox as officially dead yet. I'd say it's in a coma and it's not looking good though  .

Even if they got a new CEO, announced new partners, and relocated to singapore (for better banking) like they are proposing, I doubt many people would ever trust them with their money again.

[hilariousandco]

I'm not sure we can announce Gox as officially dead yet. I'd say it's in a coma and it's not looking good though  .

Even if they got a new CEO, announced new partners, and relocated to singapore (for better banking) like they are proposing, I doubt many people would ever trust them with their money again.

I agree. I'm not saying they'll pull through, but gox hasn't been buried yet, but it received the fatal blows long ago it's just still bleeding out. Even if/when it dies it's going to leave a bit of a mess that'll need clearing up, but the sooner gox goes six feet under the sooner we can move on. I also think Mark will be pretty much blacklisted from the community after this.

[BitGo]

https://medium.com/p/2d33cf85382b

By BitGo CEO, Will O'Brien.

Whilst I respect and believe in the multi signature technology you are promoting, I fail to see how it could have protected MT.Gox users from what was basically non-existant accounting audit practices. The theft from MT.Gox may have been going on for as long as two years!! and in all that time they failed to notice that the sum of their customer accounts did not come close to the sum of bitcoins in their hot and cold wallets!! That is incompetance of the highest magnitude, which was only multiplied by the incompetance of their software team failing to design/implement the Bitcoin protocol properly on their wallets.

I appreciate your point. If the company is not being run properly, there is little one can do. We will learn more as the details of the potential theft or drain comes to light. If it turns out that bitcoins were being drained out of an wallet, multi-sig and BitGo's security platform could have prevented it.

For example, when you can create a BitGo wallet you may also set rules, such as:
- no transaction should be signed by BitGo above $X
- no transaction should be signed without some manual secondary approval
- only sign a transaction after a waiting period
- only sign transactions request from a whitelisted IP address.

With those type of protections in place, even a manager who is not minding the store is protected.

[BitGo]

nice read, thanks.

thank you.

[CurbsideProphet]

https://medium.com/p/2d33cf85382b

By BitGo CEO, Will O'Brien.

"We are now entering the third stage, in which core financial infrastructure and services will be built by veteran entrepreneurs backed by institutional money, and in accordance with the regulatory framework of the United States and other nations. This stage will end with mainstream adoption of Bitcoin and consolidation of Bitcoin companies as large financial incumbents embrace digital currency."

"The fourth stage will begin when Bitcoin becomes a widespread medium of exchange and can be used to revolutionize industries outside of financial services, such as real estate, contracts, supply chain, and machine-to-machine commerce."

"The promise of Bitcoin is self-evident. The financial services industry has not seen much innovation over the last 50 years, and digital currency is poised to deliver 50 years worth of innovation in the next 18 months."

So just to be clear, you think stage three will take 18 months or in 18 months Bitcoin will be at stage four?

[BitGo]

https://medium.com/p/2d33cf85382b

By BitGo CEO, Will O'Brien.

"We are now entering the third stage, in which core financial infrastructure and services will be built by veteran entrepreneurs backed by institutional money, and in accordance with the regulatory framework of the United States and other nations. This stage will end with mainstream adoption of Bitcoin and consolidation of Bitcoin companies as large financial incumbents embrace digital currency."

"The fourth stage will begin when Bitcoin becomes a widespread medium of exchange and can be used to revolutionize industries outside of financial services, such as real estate, contracts, supply chain, and machine-to-machine commerce."

"The promise of Bitcoin is self-evident. The financial services industry has not seen much innovation over the last 50 years, and digital currency is poised to deliver 50 years worth of innovation in the next 18 months."

So just to be clear, you think stage three will take 18 months or in 18 months Bitcoin will be at stage four?

I think the major financial services innovation will occur over the next 18 months (it's happening already), but stage 3 will last about 3 to 5 years. It will take time for adoption, regulatory clarity, and enough scale that other industries are ready to take on digital currency.

That said, as humans we have a hard time intuiting exponential curves. Things could move a lot faster than imagined.