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Author Topic: decentralized Bitcoin are highly centralized to mtgox!11  (Read 27074 times)
ribuck
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May 13, 2011, 08:00:57 PM
 #161

Here's an angle I haven't seen discussed. I may be misinterpreting this, in which case someone please put me straight. The Russian-English sometimes makes it hard for me to understand.

At the top of this thread, bitcoinex said:

Quote
Yes, dammit, I resent, because paying for the work with bitcoins! Confess that you simply draw exchange rates!

My English interpretation is: "Dammit, I resent having to pay people (for work done) with Bitcoins! Confess that you (i.e. MtGox) are fixing the exchange rate!"

Perhaps bitcoinex contracted with someone to do some work, and set a price in BTC (e.g. 100BTC per week). It's now costing too much to buy the BTC to pay for the work being done.

A bit later in this thread:
Quote
I'm certainly interested as bitcoiny used to pay for and now I will have to pay 3 times more ... Such jumps put a cross on the distribution of bitcoin as a means of payment.

Interpretation: "I like the idea of Bitcoin as a means of payment, but now I have to pay three times as much (because of the rate increase). These jumps (in the exchange rate) are a black mark against the use of Bitcoin as a means of payment."

Perhaps bitcoinex is financially desperate due to the three-times increase in his costs (measured in fiat), and he can't meet the payments due.

MagicalTux said that the ransom demand associated with the DDOS asked for two things: a sum of money, and for the MtGox exchange rate to be reduced. Now who might want those two particular things?

Then bitcoinex's exchange stops paying out, but for a short time keeps accepting deposits. These things make one wonder.

I'm not making any kind of allegation here. I'm just painting how the material already out there already looks, and inviting bitcoinex to clear his name.
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MagicalTux
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May 14, 2011, 01:13:41 AM
 #162

On a side note I should note that while I have contracted people in bitcoins, I always add a condition stating that either party can request a re-evaluation of the paid amount should the bitcoin rate change too much (I usually define "too much" as +/- 10% BTC/USD rate). This is a fair condition, both for me (should the rate incrase too much I can buy additionnal bitcoins easily) and for the other party (should the rate get too low, they can request re-evaluation too, and not continue working for crap).

As for the DDoS itself, it seems that the now installed protections are doing their job as expected. The rate ended going quite high because of people hurrying to buy before the site goes down again instead of buying bits per bits to avoid too large impact on the market, so our russian guys had the exact reverse effect of what they wanted. I'd say it's sad for them, and the fact the rate doesn't seem to be dropping again means everyone trust bitcoins has - or will have - at least the value it has now.

Anyway may this serve as a lesson to everyone: do not make contracts based on a value that can buy a cake one day, and a car the next day.

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May 14, 2011, 09:20:22 AM
 #163

Here's an angle I haven't seen discussed. I may be misinterpreting this, in which case someone please put me straight. The Russian-English sometimes makes it hard for me to understand.

At the top of this thread, bitcoinex said:

Quote
Yes, dammit, I resent, because paying for the work with bitcoins! Confess that you simply draw exchange rates!

My English interpretation is: "Dammit, I resent having to pay people (for work done) with Bitcoins! Confess that you (i.e. MtGox) are fixing the exchange rate!"

Perhaps bitcoinex contracted with someone to do some work, and set a price in BTC (e.g. 100BTC per week). It's now costing too much to buy the BTC to pay for the work being done.

A bit later in this thread:
Quote
I'm certainly interested as bitcoiny used to pay for and now I will have to pay 3 times more ... Such jumps put a cross on the distribution of bitcoin as a means of payment.

Interpretation: "I like the idea of Bitcoin as a means of payment, but now I have to pay three times as much (because of the rate increase). These jumps (in the exchange rate) are a black mark against the use of Bitcoin as a means of payment."

Perhaps bitcoinex is financially desperate due to the three-times increase in his costs (measured in fiat), and he can't meet the payments due.

MagicalTux said that the ransom demand associated with the DDOS asked for two things: a sum of money, and for the MtGox exchange rate to be reduced. Now who might want those two particular things?

Then bitcoinex's exchange stops paying out, but for a short time keeps accepting deposits. These things make one wonder.

I'm not making any kind of allegation here. I'm just painting how the material already out there already looks, and inviting bitcoinex to clear his name.

I think you are right. It's hard for people to deal when they haven't experienced anything like this. It's just not safe to agree to pay coins you don't have or to do your accounting in one currency and promise to pay another and not hedge properly.

If I promise to pay someone in coins I have the coins and consider them gone. If I want to protect my feelings about how costly work or goods are I can buy more coins so that the spend was essentially in fiat.

Be sure in your own mind what you are doing. Don't think "I promised to pay 3BTC, that is $24. Oh, shit now it's $58." You never promised to pay $24. You promised 3BTC and nothing has changed about that.

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May 15, 2011, 10:18:33 AM
 #164

IMHO the guy is scum.


However, it should also be pointed out that anyone making any kind of arrangements in BTC is an idiot. How many currencies of normal countries(Zimbabwe aside, okay?) do you know that have 600% fluctuations in their currency?

Anyone with half an awake central bank fluctuates between -50% - +100% of a certain mean over years(EURUSD: 0.82-1.6 range since around the inception, last 8 years: 1.17-1.6 = less than 40% change). And that is over several months/years, not within 6 weeks.


BTC is like a penny stock, not a currency.
People need to start waking up and put ideology and fantasy aside when it comes to real money, real obligations.

Other than that, what kind of guy has liquidity problems with < $1000 amounts? You should not be doing _ANY_ kind of business if $1000 is a lot of money for you.

Ho-Hum.
Justsomeforumuser
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May 15, 2011, 10:23:07 AM
 #165

Why? A one man shoe-shining business could strive with such amount of startup capital.  Grin


My bad, I thought we were being serious for a second.

Ho-Hum.
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June 08, 2011, 10:13:58 PM
 #166

MtGox now has a real competitor, so it is now far less decentralized: http://www.tradehill.com/

More features, lower fees (and a 10% discount on all fees if you use this code: TH-R1168)

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June 14, 2011, 08:29:59 PM
 #167

MtGox now has a real competitor, so it is now far less decentralized: http://www.tradehill.com/

More features, lower fees (and a 10% discount on all fees if you use this code: TH-R1168)

or just use this link to go there: http://tradehill.com/?r=TH-R11543, that's even simpler Wink

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