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Author Topic: Peter R Rizun's theory on the collapse of MtGox and its effect on the price of bitcoin  (Read 76856 times)
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BitCoinsLOL
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March 07, 2014, 10:02:57 PM
 #81

This has to be the best explanation I've seen. Excellent article well done Peter R.

I never thought my life could be. Anything but catastrophe. But suddenly I begin to see. A "BIT" of good luck for me. Cause I've got a golden ticket!
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March 08, 2014, 08:28:32 AM
 #82

If this is true, then a huge majority of bitcoin's price is not 'natural' or sustainable growth (no more ?Willy?). This seems like incredibly bearish news if true. Anyone else wanna think this through with me?

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March 08, 2014, 03:39:55 PM
 #83

It always seemed like the growth was just to much and unnatural. It always felt like there was so much buying pressure.  If there really was a Willy it would be really bad news now.  Now there isn't as much buying pressure.
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March 09, 2014, 11:31:33 PM
 #84

Quite the interesting read Peter R.  Nice summary of events with a sprinkle of what-if that seems quite plausible.  My hats off to you good sir.

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March 10, 2014, 12:38:48 AM
 #85

So how does one find the fckers that stole the coins, or is that impossible?

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March 10, 2014, 05:03:28 PM
 #86

nEVER understood the irony of pointing out trolls (maybe one of you trolls can explain it to me, by inbox of course), anybody that can comprehend the definitions of words and knows how to use them, feel free to reply to my post, constructive comments about post are always accepted, everything else is cowardly. Im in LA, never scared of niggers anywhere Smiley
                                                                                     
                                                                                                ^^^^
                                                                                          Ban this racist asshole!

 You just showed your true colors.

I never thought my life could be. Anything but catastrophe. But suddenly I begin to see. A "BIT" of good luck for me. Cause I've got a golden ticket!
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March 11, 2014, 03:39:26 PM
 #87

Most interesting theory of Gox to date.
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March 12, 2014, 06:32:43 PM
 #88

If this is true, then a huge majority of bitcoin's price is not 'natural' or sustainable growth (no more ?Willy?). This seems like incredibly bearish news if true. Anyone else wanna think this through with me?

This is the most interesting part of this theory imo, if the price has been manipulated to this degree until last week then what are bitcoins really worth? Looking at the charts there is a definite change in patterns since the Gox related crash on 25th Feb. This could be explained by the removal of a good portion of traders via Gox, but the volume (outside of whale moves) is remarkably low. Is there nearly as much interest as we thought?
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March 12, 2014, 06:53:19 PM
 #89

nEVER understood the irony of pointing out trolls (maybe one of you trolls can explain it to me, by inbox of course), anybody that can comprehend the definitions of words and knows how to use them, feel free to reply to my post, constructive comments about post are always accepted, everything else is cowardly. Im in LA, never scared of niggers anywhere Smiley
                                                                                     
                                                                                                ^^^^
                                                                                          Ban this racist asshole!

 You just showed your true colors.

It's not racist if he's a n...african american.

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March 12, 2014, 07:08:36 PM
 #90

If this is true, then a huge majority of bitcoin's price is not 'natural' or sustainable growth (no more ?Willy?). This seems like incredibly bearish news if true. Anyone else wanna think this through with me?

On the other hand, the loss of all of the fake GoxBTC is a deflationary event. People are no longer spending their money to buy the fake coins, they are going to buy the real ones, which may drive the price further up.
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March 12, 2014, 07:56:32 PM
 #91

This makes more sense than any other theory or explanation I've heard.
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March 12, 2014, 08:19:50 PM
 #92

nEVER understood the irony of pointing out trolls (maybe one of you trolls can explain it to me, by inbox of course), anybody that can comprehend the definitions of words and knows how to use them, feel free to reply to my post, constructive comments about post are always accepted, everything else is cowardly. Im in LA, never scared of niggers anywhere Smiley
                                                                                     
                                                                                                ^^^^
                                                                                          Ban this racist asshole!

 You just showed your true colors.

It's not racist if he's a n...african american.

Still offensive though.
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March 16, 2014, 11:21:25 PM
 #93



He purposely mixed immature coins into bitcoin withdrawals to delay the outward flow of coins, and later began malling his own transactions.  


hy,
nice writing!
could you explain what "immature coins" means?
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March 17, 2014, 12:00:55 AM
 #94

He purposely mixed immature coins into bitcoin withdrawals to delay the outward flow of coins, and later began malling his own transactions.  
could you explain what "immature coins" means?

When a miner finds a new block, he is permitted to issue what's known as a "coinbase" transaction to an address under his control.  The value of this coinbase transaction must be equal to or less than the block reward plus the sum of all transaction fees included in the block.  

The problem is that these new coins could disappear should his block get orphaned or a major blockchain re-org event were to take place.  For this reason, these new coins are considered immature and un-spendable until they are buried 100 blocks deep in the blockchain.  If you try to spend a coinbase output before it has "matured," it will be rejected by the network.  

Why might MtGox have had immature coins to begin with if such coins can't be transferred?  The answer is that some miners were mining directly to their MtGox deposit addresses.  

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March 17, 2014, 01:05:47 AM
 #95

Nice proposal.  I hope that it can be confirmed and improved as more data and analyses become available.

I have two questions:

(1) The proposed loss of 1 M BTC at that time could have been theft by hackers, or could have been any of the other hypotheses that were suggested (theft by insider, Mark selling the coins off-market,  police seizure, lost keys, etc.).  Are there evidence or testimonials that point to hacker theft, specifically?

(2) What do you make of this theory, that MtGOX sold/used 750 kBTC to settle the 75 M$ CoinLab lawsuit? http://www.reddit.com/r/Bitcoin/comments/1z8vaq/crowd_detectives_reveal_mt_gox_bitcoin_heist_as/

Academic interest in bitcoin only. Not owner, not trader, very skeptical of its longterm success.
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March 17, 2014, 03:52:44 AM
 #96

(1) The proposed loss of 1 M BTC at that time could have been theft by hackers, or could have been any of the other hypotheses that were suggested (theft by insider, Mark selling the coins off-market,  police seizure, lost keys, etc.).  Are there evidence or testimonials that point to hacker theft, specifically?

The only things I personally know for sure is that MtGox was indeed hacked or "hacked" on June 19, 2011, but that Mark denied heavy losses and then moved 424242 BTC to prove or "prove" solvency.  One reason I like the theory is that it also explain why the bear market of 2011 was so severe: the hacker was selling about a million coins into an illiquid market.  

I've heard rumours that Mark was on IRC asking the developers, in a panic, to help "reverse the blockchain," but no one has been able to give me actual evidence of this.  I also have heard whisperings of some "secret" that Mark had, but again I have no real information.  This thread from June 20, 2011 is really interesting [https://bitcointalk.org/index.php?topic=20207.0].  Kevin bought 260,000 BTC for under $3000 during the crash and thinks he could have snuck them out of Gox if he were more prepared.  This trade was apparently rewound.  

Hopefully we will learn the truth in time.  

Quote
(2) What do you make of this theory, that MtGOX sold/used 750 kBTC to settle the 75 M$ CoinLab lawsuit? http://www.reddit.com/r/Bitcoin/comments/1z8vaq/crowd_detectives_reveal_mt_gox_bitcoin_heist_as/

I don't buy this theory.  If it were true I think we'd have strong evidence that CoinLab actually received $75 million.  And if those coins were sold in May 2013, I expect we'd have seen a much sharper decline in the bitcoin price.  EDIT: and most importantly, if this were the case, Mark would have undeniably been illegally operating an insolvent business--even CoinLab would have known this.  Word would have gotten out sooner.

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March 17, 2014, 06:05:55 AM
 #97

(2) What do you make of this theory, that MtGOX sold/used 750 kBTC to settle the 75 M$ CoinLab lawsuit? http://www.reddit.com/r/Bitcoin/comments/1z8vaq/crowd_detectives_reveal_mt_gox_bitcoin_heist_as/

I don't buy this theory.  If it were true I think we'd have strong evidence that CoinLab actually received $75 million.  And if those coins were sold in May 2013, I expect we'd have seen a much sharper decline in the bitcoin price.  EDIT: and most importantly, if this were the case, Mark would have undeniably been illegally operating an insolvent business--even CoinLab would have known this.  Word would have gotten out sooner.

Apparently the lawsuit is still in progress and is scheduled to be tried in Nov/2014, may drag on to 2018:

https://bitcointalk.org/index.php?topic=477142.msg5261573#msg5261573

Reply by MtGOX to the lawsuit:
http://numismatics.pwnz.org/coinlab-v-mtgox-answer-complaint/

Reply by CoinLab to MtGOX's reply:
http://thegenesisblock.com/coinlab-files-response-mt-gox-lawsuit/

Lawsuits are often settled out of court, but if that had happened I suppose that we would have known.

However, if MtGOX had settled the lawsuit by handing over 750,000 BTC instead of 75 M$, CoinLab obviously would not denounce him.

Academic interest in bitcoin only. Not owner, not trader, very skeptical of its longterm success.
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March 17, 2014, 05:55:42 PM
 #98

Deleted. Wrong thread. Sorry.

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March 18, 2014, 04:15:48 AM
 #99

(2) What do you make of this theory, that MtGOX sold/used 750 kBTC to settle the 75 M$ CoinLab lawsuit? http://www.reddit.com/r/Bitcoin/comments/1z8vaq/crowd_detectives_reveal_mt_gox_bitcoin_heist_as/

I don't buy this theory.  If it were true I think we'd have strong evidence that CoinLab actually received $75 million.  And if those coins were sold in May 2013, I expect we'd have seen a much sharper decline in the bitcoin price.  EDIT: and most importantly, if this were the case, Mark would have undeniably been illegally operating an insolvent business--even CoinLab would have known this.  Word would have gotten out sooner.

Apparently the lawsuit is still in progress and is scheduled to be tried in Nov/2014, may drag on to 2018:

https://bitcointalk.org/index.php?topic=477142.msg5261573#msg5261573

Reply by MtGOX to the lawsuit:
http://numismatics.pwnz.org/coinlab-v-mtgox-answer-complaint/

Reply by CoinLab to MtGOX's reply:
http://thegenesisblock.com/coinlab-files-response-mt-gox-lawsuit/

Lawsuits are often settled out of court, but if that had happened I suppose that we would have known.

However, if MtGOX had settled the lawsuit by handing over 750,000 BTC instead of 75 M$, CoinLab obviously would not denounce him.


Dig around a bit you will see CoinLabs more over Peter Vessenes is no incubator or entrepreneur, the trail of scams and losses, and incompetence following him around is shocking. He screwed over Gox, no question in my mind. Even The Bitcoin Foundation is a way to give legitimacy to his impetus.

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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March 18, 2014, 07:55:24 AM
 #100

Interesting theory, but it doesn't jive with all the facts. The rallies correlate very well with Google search activity. If one man or bot was driving these rallies then you would not see the search activity behave in Google the way it has during the rallies. Also without the support of the bot, the market would have severely crashed and stayed down after Mt Gox closed. I really enjoyed the intrigue in the theory (not that Bitcoin doesn't already have enough intrigue) and think it would make an excellent movie.

Another reason to doubt the theory is simply to read all the analysis blogs that follow Bitcoins price. Bitcoin market activity tends to follow the rules and trends that a stock/commodity does in general. Moving averages, levels of support based on Standard Deviation, etc. Other than the crash on Mt Gox in 2011, Bitcoin trading seems to follow these statistical rules. The statistical rules that govern market trading behaviour would be violated if one person were manipulating the market to that extent.

Last but not lease other exchanges have also been hacked and BTC have been stolen because of this transaction malleability problem. If this were engineered by Mark K, then other exchanges would not be affected. The theory also assumes that Mark K has the intelligence to pre-plan this all.  Grin
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