[Open Discussion] Centralized Bitcoin Services at Mt. Gox

[Raoul Duke]

Gox is pioneering, you say?
If you call pioneering to buying something that already exists(MtGox was bought) and copying bit-pay, only integrated into their exchange, then yes, they are pioneering...

I usually listen to what you say and agree with you, but pioneering, really? 

Well, MtGox was beaten when the first bitcoin exchange appears. MtGox won by being more convenient than others. They're also one of the first to implement mutli-factor authentication. Now they're competing with bitpay, which provide competition.

Not exactly original, but winners are often decided on execution, not the most original idea.

Being better is not a sign of being pioneers(original). I was only disagreeing on his choice of words. I know that MtGox is the biggest, and so far it isn't for lack of competition, I think it's more the "beaten wife" syndrome, we just got used to it

[1714007651]

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[stochastic]

This thread's purpose is to discuss the issues that reside with Mt. Gox being 95% of the entire volume of BTC traded as well as possibly a large portion of merchant solution services.

This in my opinion can be bad for bitcoin if Mt. Gox were ever shutdown in its corporate structure (if it has one).

Centralization of services for bitcoin is not a good thing. It gives less options to choose.

Anyways...just by 0.02 BTC...

Well getting away from centralization is the opposite of how networks naturally evolve.  In almost all networks, from electrical distribution systems, website linkages, "Six Degrees of Kevin Bacon", and the bitcoin network itself.  Many networks are scale-free small-world networks and I don't think bitcoin is any different at this stage.

If you want a less centralized network, what you are saying is that you want a network where a few hubs do not have most of the connections.  It would take a lot of work to change our ability to form centralized networks.  Maybe a P2P exchange would work.

[SMTB1963]

Again, there is all the difference in the world between "forced, coercive centralization" and "voluntary, market-based centralization."

So if someone hangs me, that's bad...but if I hang myself, it's all good!  Got it.

No one coerced/forced anyone to use Visa/MC/AMEX/PayPal/etc. either.

PS: Bye Bye bitpay.  We'll miss you.

[imanikin]

Testify!  Some "completely decentralized currency" this is turning out to be, with MtG doing 90% of the trades, and Deepbit doing at least 1/3 of the mining. 

Once Bitcoin is popular enough, it will be very convenient for whatever entity to take over MtG along with all the B that's in its wallets at any given time, under whatever pretense...

Then it will be very clear to all of us how short-sighted and stupid we were to put so many of the eggs of the golden goose in the same old centralized baskets... 

Happy dwelling in the "completely decentralized currency" delusion! Party on! 
 

[Sukrim]

The big problem about a P2P exchange is neither the concept nor the BTC side - it's the problem that it's _really_ hard to "upload" USD, EUR + co. to a cheap (low/no fees), trustworthy (no chargebacks, no running away with the account) and accessible location.

Other cryptocurrencies like NMC or so would of course work, but in reality people want to enter their credit card numer on a nice looking website and spend 100 USD/EUR on BTC or at least have 100 USD/EUR in their "wallet" to be spent.

Maybe it might even be worthy to lobby at a bank for some "Chaum money" to have some digital bills to trade?

Understandably, MtGox tries to market their coupons like something similar, these are however far too integrated into a Bitcoin centered business. I'd love to see something completele independent of BTC to offer this digital fiat cash...

[muyuu]

Ideally bitcoin-only transactions would dwarf all the exchange with other currencies combined. Well, that's what happens with basically every normal currency in the world, and that would happen if adoption was even at 1% of the population. There would be enough ecosystem to keep bitcoins and use them directly most of the time, rather than converting them.

[evoorhees]

Gox is pioneering, you say?
If you call pioneering to buying something that already exists(MtGox was bought) and copying bit-pay, only integrated into their exchange, then yes, they are pioneering...

I usually listen to what you say and agree with you, but pioneering, really? 

How much money, time, and effort have you spent setting the international legal precedents for how Bitcoin will be perceived by the globe? The legal work they are doing, and the legal attacks they'll inevitably encounter and deal with, are huge benefits to the rest of us. What they are pioneering is how Bitcoin integrates with establish payment networks and laws around the world. If Bitcoin succeeds in making that integration, then it's subsequent success is highly likely.

Besides, Gox is the first mega-successful Bitcoin exchange in the history of the universe. How much more pioneering can one be?  

[Phinnaeus Gage]

Everyone agrees, it's finding a safe alternative that's hard.

Even a few major exchanges isn't ideal. We need a way to completely decentralize the exchange between fiat and Bitcoin but that is far easier said than done. People are working on it and I'm sure better solutions will come along. I'd personally like to see 100,000 people offering to trade it in person. Essentially anyone that uses it buying / selling on a spread. I think mobile clients will be key for this.

P.S. not a stab at Mt Gox. I think Mark himself will agree that centralization goes against the concept of Bitcoin.

I quit reading the rest of the thread here. I like this post! The way I see it is that in the future, if it pans out as you describe, Jered, Mt Gox won't need to be in control of anywhere near 95% of the total bitcoins in circulation to be not only a viable Bitcoin entity, but a profitable one at that.

God speed to both of you.

~Bruno~

[Cosbycoin]

Is this an anti-MtGox thread?
Like a protest?
Then I'd rather take no side - just my own.
The truth is, they are winning the market, because so far there have been the smartest one in this game.
If you were smarter - you could have beaten them.
Obviously none of you was - sorry

Obviously you missed the point of this thread. The point was to provide discussion of the issue of CENTRALIZATION of bitcoin services.

Moreso this has nothing to do with how smart one is or isn't. By your post above you are showing us that you're more likely not smart given you couldn't read the original post.

Your input is still welcome. 

[evoorhees]

Testify!  Some "completely decentralized currency" this is turning out to be, with MtG doing 90% of the trades, and Deepbit doing at least 1/3 of the mining. 

It is completely decentralized. You're free not to use Gox at all. Contrast this with a centralized money, like the USD, and you are not free to abandon the Federal Reserve. Big difference.

Once Bitcoin is popular enough, it will be very convenient for whatever entity to take over MtG along with all the B that's in its wallets at any given time, under whatever pretense...

Lesson: don't store tons of coins at gox. Problem solved! If Gox was "taken over", a new mega exchange would spring up quickly. The need to exchange coins doesn't go away. Gox has no forced monopoly. Markets adjust.

Then it will be very clear to all of us how short-sighted and stupid we were to put so many of the eggs of the golden goose in the same old centralized baskets... 

Who's putting all their eggs in the Gox basket? Maybe you're the only one?

Happy dwelling in the "completely decentralized currency" delusion! Party on! 

Don't be a douche. In which currency do you dwell? And how much of a delusion are you under, I wonder?

[Raoul Duke]

Gox is pioneering, you say?
If you call pioneering to buying something that already exists(MtGox was bought) and copying bit-pay, only integrated into their exchange, then yes, they are pioneering...

I usually listen to what you say and agree with you, but pioneering, really? 

How much money, time, and effort have you spent setting the international legal precedents for how Bitcoin will be perceived by the globe? The legal work they are doing, and the legal attacks they'll inevitably encounter and deal with, are huge benefits to the rest of us. What they are pioneering is how Bitcoin integrates with establish payment networks and laws around the world. If Bitcoin succeeds in making that integration, then it's subsequent success is highly likely.

Besides, Gox is the first mega-successful Bitcoin exchange in the history of the universe. How much more pioneering can one be?  

Gotcha! and about the legislation I absolutelly agree.

[kjlimo]

Mtgox is like yahoo when the internet was created...

Eventually Google will come along... but it may take a few years...

until then Yahooooooooooooo!

[Ponies]

The importance of decentralization is that we can always withdraw from gox or in the future a bitcoin bank account and store the bitcoins in our own personal wallets where we can use them anonymously and safely secure them without anyone else having access to them. However, we lose a lot of convenience doing this so I would expect the majority of bitcoins to be held in some kind of centralized service in the future.

[niko]

Is this an anti-MtGox thread?
Like a protest?

This is a great thread, but I don't see it all as an anti-MtGox thread. On the contrary, I see it as an anti-me-and-most-of-everyone-else thread. It points out the painfully obvious fact that, while most of us realize that there is a problem, we are not ready to sacrifice even a bit of comfort or money and solve the problem.

MtGox is currently the easiest and cheapest way for me to exchange to and from Bitcoins, and I am not seriously looking into alternatives, even though I realize this may not end up well.

I also realize that, to some extent, bitching about perceived problems in forums or political rallies only serves to vent the frustration so people can comfortably go back home and continue business as usual.

[triplehelix]

i have nothing against mtgox.  i think more active exchanges would be good.  i think multiple active exchanges, a p2p option, and a large amount of face to face (including retail) exchange would be optimal.

[smoothie]

Mtgox is like yahoo when the internet was created...

Eventually Google will come along... but it may take a few years...

until them Yahooooooooooooo!

Good insight and perhaps you are right. In time things will smooth out.

[stochastic]

I would like to see selling directly from the mining pools.

[Transisto]

If MtGox was to offer an even lower fees on much higher volume of transaction that could stimulate the creation of other exchanges.
Exchanges like Bitcoinica but with actual reserve and USD processing.


IMO MtGox going down does not fundamentally threaten the Bitcoin network buy big pool like DeepBit may.

Should it go down I'd be more than willing help you get rid of all your bitcoins for 2$ each.

[kiba]

i have nothing against mtgox.  i think more active exchanges would be good.  i think multiple active exchanges, a p2p option, and a large amount of face to face (including retail) exchange would be optimal.

This is why bitcoin should build up presence in New Hampshire! Concentrate bitcoin in one location, and you get a lot of face to face usage and stronger network effect that will begin to spread across NH's border!