[Payout Updates] Bitcoinica site is taken offline for security investigation

[bulanula]

I am supposed to only give out the status for emails. Accounts are in 3 states:

- Fake. This is a minority of accounts so far we are certain are impostors.
- Accurate. At my last count, this was around 1 in 20 (5%). Only a portion of these has been paid so far. Still working through paying these people back (I don't have access to funds personally. It works like Donald gets a portion and does them in chunks at a time with proper authorisation from Tihan and Patrick).
- Queued. Majority of claims are in the queue waiting to be examined. Around half (a guess) of claims I believed were accurate, and various fakes got pushed back into the "lets examine then later category". Most simply haven't been looked at yet.

The idea is to sort out claims with the highest certainty (this means quicker payouts), then as you work down, you reconcile them with other payments. I know people here are congratulating me, but I've actually been a hindrance for the claims process. Several times, I caused some mix-ups and confusion so Donald hands me batches/tasks to complete at a time.

Genjix, can you please clarify to me under which status does my accounts hold at the moment?

Maria. <3

You have no claim.

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

I do have a claim, and its a public one. Part of the funds you are holding are for a pending donation list I have including 1000 BTC for the forum. My claim now is aprox. 16500 BTC interest included.

If you have no intention of honoring my claim, please let me know. I have a PLAN B for your type of people.

Maria.

People please look at this post carefully.

These type of fraudulent claims ( and to think he has the audacity to make these scammy claims PUBLICLY ) are why your coins are not in your wallet already ...

[LoupGaroux]

Actually, the fakes are moved out of the queue fairly quickly, and with no new claims being processed (if I am paraphrasing accurately?) then there is no barrier whatsoever to payments being made quickly.

Oh, except they don't move fast, and only have one poor over-worked soul doing anything, including fielding the righteous anger of the masses, while the rest sit around apparently trying to decide who gets to be the boss-man.

[phantomcircuit]

You have no claim.

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

I do have a claim, and its a public one. Part of the funds you are holding are for a pending donation list I have including 1000 BTC for the forum. My claim now is aprox. 16500 BTC interest included.

If you have no intention of honoring my claim, please let me know. I have a PLAN B for your type of people.

Maria.

The claims process (both policies and procedures) are very reasonable.

Your refusal to go through the standard claims process constitutes clear and obvious bad faith.

As I said

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

[Transisto]

You have no claim.

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

I do have a claim, and its a public one. Part of the funds you are holding are for a pending donation list I have including 1000 BTC for the forum. My claim now is aprox. 16500 BTC interest included.

If you have no intention of honoring my claim, please let me know. I have a PLAN B for your type of people.

Maria.

The claims process (both policies and procedures) are very reasonable.

Your refusal to go through the standard claims process constitutes clear and obvious bad faith.

As I said

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

NO CARE !!! ...

Please keep private talks where they belong.

[mem]

I am supposed to only give out the status for emails. Accounts are in 3 states:

- Fake. This is a minority of accounts so far we are certain are impostors.
- Accurate. At my last count, this was around 1 in 20 (5%). Only a portion of these has been paid so far. Still working through paying these people back (I don't have access to funds personally. It works like Donald gets a portion and does them in chunks at a time with proper authorisation from Tihan and Patrick).
- Queued. Majority of claims are in the queue waiting to be examined. Around half (a guess) of claims I believed were accurate, and various fakes got pushed back into the "lets examine then later category". Most simply haven't been looked at yet.

The idea is to sort out claims with the highest certainty (this means quicker payouts), then as you work down, you reconcile them with other payments. I know people here are congratulating me, but I've actually been a hindrance for the claims process. Several times, I caused some mix-ups and confusion so Donald hands me batches/tasks to complete at a time.

Genjix, can you please clarify to me under which status does my accounts hold at the moment?

Maria. <3

You have no claim.

The online claims process is now closed to new claims.

If you wish to pursue a claim you will need to send a notarized copy of any and all information you have by mail to the registered address as listed by business.govt.nz

I do have a claim, and its a public one. Part of the funds you are holding are for a pending donation list I have including 1000 BTC for the forum. My claim now is aprox. 16500 BTC interest included.

If you have no intention of honoring my claim, please let me know. I have a PLAN B for your type of people.

Maria.

Interesting.

So "Maria" has 1000 btc owed - for charity to (awwww what a nice gurl).
She amusingly demands interest of 60% (I  assume to help out those charities)
Makes thinly veiled threats of violent visits (strange for a charitable person dont you think).
Refuses to log a claim and supply personal information.

The amount of money ($6000 AUD) is only worth a single paid violent visit to an individual (I have my contacts).
You would never announce you are having someone come over to persuade if you were indeed the type of person to organize this.

My guess Maria = Butt Hurt silk road seller trying to pretend they have some clout. If 5k has impacted your drug business at all you are essentially powerless.
Maria is hoping to reclaim her drug money, but is unable to provide the ID needed to do so, so here she is making public hollow threats.

sub

[repentance]

Interesting.

So "Maria" has 1000 btc owed - for charity to (awwww what a nice gurl).
She amusingly demands interest of 60% (I  assume to help out those charities)
Makes thinly veiled threats of violent visits (strange for a charitable person dont you think).
Refuses to log a claim and supply personal information.

The amount of money ($6000 AUD) is only worth a single paid violent visit to an individual (I have my contacts).
You would never announce you are having someone come over to persuade if you were indeed the type of person to organize this.

My guess Maria = Butt Hurt silk road seller trying to pretend they have some clout. If 5k has impacted your drug business at all you are essentially powerless.
Maria is hoping to reclaim her drug money, but is unable to provide the ID needed to do so, so here she is making public hollow threats.

sub

Check her post history.  Making grandiose claims is one of Maria's favourite pastimes - she helped Satoshi launch Bitcoin, doncha know.

[wirmola]

I have been sending mails to bitcoinica about the claims page but I don't get a reply... ??

[muyuu]

If you have no intention of honoring my claim, please let me know. I have a PLAN B for your type of people.

Maria.

Hey phantomcircuit, mate. Aren't you very, very scared?

[disclaimer201]

Perhaps the donations are even real! For example, to get tax deduction. I have to look up money laundering in a dictionary first, one moment...here it is..."to channel money through an intermediary in order to conceal its source..." nevermind.

[genjix]

I want to explain the logic behind 50% initial payments:

For each claim you have a certainty of its validity. You have the sum of funds from before the site had the database stolen which is equal to the site's previous balance. This sum must be distributed among claims somehow.

Ideally you would mark claims that you thought were accurate and those that weren't (based on what the data indicates to us). Then you would end up with some total value which you compare to the total funds available.

If less than the total funds, then be more permissive and allow certain more claims in. Repeat the above step.

If more than the total funds, then knock out low certainty claims and maybe redistribute funds among lower certainty claims (better that someone who is maybe legitimate, gets something rather than nothing).

You then end up with claims that are refunded with a best-fit according to the available data.

However people demand funds quickly. So as a compromise, we make 50% payouts initially (for claims we are highly certain are accurate). This allows an error margin so that in the final step we can still juggle balances around to resolve payments for everybody. The only downside is that you cannot decide to pay someone 0% after you've paid them 50%.

Then once people have been refunded for 50% and the final balances are decided, the process goes back over payees and refunds them for the remaining amount. I assume the final step should not take long given that it's just making payments out for known beneficiaries.

[Ichthyo]

Hello genjix,

would you mind explaining some details of how you handle your payout? It seems this could settle the worries of a lot of people here.

• (1) assumed someone is considered 100% correct, and this claim is for a position of M bitcoins and N USD.
  Is it correct then that this claimant recieves an payout of M bitcoins and N USD? Obviously, as you stated, the first round of payouts will be 50% on each part, but in any case, no conversion whatsoever happens?
• (2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
  Is this statement still valid?
• (2) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

[proudhon]

genjix, how are the 50% disbursements going?  It's been a while since anyone's posted about getting a payment.  Just wondering if there's a hold up or if you're still making regular payments.  Do you email people to notify them that you've sent a payment?  Do people get emails notifying them that they're accurate and just in a queue for payments?

When I finally got an email about my claims status I was told that my "account is in the queue and waiting to be reviewed".  I'm assuming that means that my account just hasn't been gotten to at all yet.  Is that right?  Or does it mean that there's something wrong with my information and it needs to be reviewed in more depth?

[Ichthyo]

....the only way would be to trade and speculate with those bitcoins, which would be an immediate violation of the fact that those bitcoins are owned by other people.

I think they already do (and always did before), they were Bucket shop

I don't think the "bucket shop" label is accurate. Bitcoinica did hedge the net balance of all open positions into the real BTC market (Mt.Gox). Tong even posted the piece of Ruby code performing this operation some weeks ago. So basically Bitcoinica never traded against their own customers. The only actual uncovered finnancial risks involved for them (assides from malfunction of the code) was the possibility of losses when force liquidating due to a catastrophic market movement.

Of course it would be possible that those statemens where just lies, and actually they did bet against their customers. But unless someone provides some prove for that suspicion, I take Bitcoinica's statement at their face value.

Thus, the site would rather be classified as a "Contract for Difference" derivative offer, not a "Bucket Shop".

The term Bucket Shop is a defined term under the criminal law of many states in the United States which make it a crime to operate a bucket shop. Typically the criminal law definition refers to an operation in which the customer is sold what is supposed to be a derivative interest in a security or commodity future, but there is no transaction made on any exchange. The transaction goes in the bucket and is never executed. Without an actual underlying transaction, the customer is betting against the bucket shop operator, not participating in the market.

[genjix]

Hello genjix,

would you mind explaining some details of how you handle your payout? It seems this could settle the worries of a lot of people here.

(1) assumed someone is considered 100% correct, and this claim is for a position of M bitcoins and N USD.
Is it correct then that this claimant recieves an payout of M bitcoins and N USD? Obviously, as you stated, the first round of payouts will be 50% on each part, but in any case, no conversion whatsoever happens?

It's up to the claimant. They can specify their payment preferences with the main ones at the moment being BTC and MtGox codes. But we're also able to provide other payment options within reason (like bank deposits).

(2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
Is this statement still valid?
(3) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

2- not sure. I'll have to check and repost here. I think they are being closed at 5 (not sure though).

3- it's subjective depending on the claim. My preference would be to assume no position, but it depends on the case itself.

genjix, how are the 50% disbursements going?  It's been a while since anyone's posted about getting a payment.  Just wondering if there's a hold up or if you're still making regular payments.  Do you email people to notify them that you've sent a payment?  Do people get emails notifying them that they're accurate and just in a queue for payments?

~35% of claimants are marked accurate
~86% of total funds are marked accurate
~25% of total funds have been repaid

No people aren't getting emails when their account status changes. I want to get whether a claim is marked accurate or not added to the claim ticket.

When I finally got an email about my claims status I was told that my "account is in the queue and waiting to be reviewed".  I'm assuming that means that my account just hasn't been gotten to at all yet.  Is that right?  Or does it mean that there's something wrong with my information and it needs to be reviewed in more depth?

Yep, you're right. If your account needs to be reviewed more in depth then you would get a message along the lines of either "your account will take a longer to review" or that "your account is placed at the end of the queue because...".

[Transisto]

...
(2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
Is this statement still valid?
(3) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

2- not sure. I'll have to check and repost here. I think they are being closed at 5 (not sure though).
...

...Do you email people to notify them that you've sent a payment? Do people get emails notifying them that they're accurate and just in a queue for payments?

...

People have been asking for this from day 1 and this is the answer you have ?  "5$, not sure"

You've not answered, I suggest you send notice before and after sending payment... to avoid sending to wrong addresses.

[phantomcircuit]

...
(2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
Is this statement still valid?
(3) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

2- not sure. I'll have to check and repost here. I think they are being closed at 5 (not sure though).
...

...Do you email people to notify them that you've sent a payment? Do people get emails notifying them that they're accurate and just in a queue for payments?

...

People have been asking for this from day 1 and this is the answer you have ?  "5$, not sure"

You've not answered, I suggest you send notice before and after sending payment... to avoid sending to wrong addresses.

I'd swear I had answered this.

Anyways shorts close @ 4.9 longs @ 5.1

[chunglam]

Hi genjix/phantomcircuit,

The base price of my long position is higher than 5.1 and my USD balance is zero, so will you sell my BTC to cover the lose of my long position? @what price? Thanks.

[dancingnancy]

...
(2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
Is this statement still valid?
(3) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

2- not sure. I'll have to check and repost here. I think they are being closed at 5 (not sure though).
...

...Do you email people to notify them that you've sent a payment? Do people get emails notifying them that they're accurate and just in a queue for payments?

...

People have been asking for this from day 1 and this is the answer you have ?  "5$, not sure"

You've not answered, I suggest you send notice before and after sending payment... to avoid sending to wrong addresses.

I'd swear I had answered this.

Anyways shorts close @ 4.9 longs @ 5.1

I don't believe it was ever answered.  Are you in charge of doing the disbursements now?  It would be nice if there was like a timetable for payouts.  I may be one of the few, but like most/all of my money was tied up in this.  If we could get a reasonable timetable with our first 50% payouts that would be excellent.  Thanks.

[naima53]

....the only way would be to trade and speculate with those bitcoins, which would be an immediate violation of the fact that those bitcoins are owned by other people.

I think they already do (and always did before), they were Bucket shop

I don't think the "bucket shop" label is accurate. Bitcoinica did hedge the net balance of all open positions into the real BTC market (Mt.Gox). Tong even posted the piece of Ruby code performing this operation some weeks ago. So basically Bitcoinica never traded against their own customers. The only actual uncovered finnancial risks involved for them (assides from malfunction of the code) was the possibility of losses when force liquidating due to a catastrophic market movement.

Of course it would be possible that those statemens where just lies, and actually they did bet against their customers. But unless someone provides some prove for that suspicion, I take Bitcoinica's statement at their face value.

Thus, the site would rather be classified as a "Contract for Difference" derivative offer, not a "Bucket Shop".

I'm sorry, I did not know about it.

[S3052]

...
(2) you stated in the past that you will close out open positions at a fixed buy/sell rate, which is close to the BTC/USD price at the time the site was taken offline.
Is this statement still valid?
(3) how do you intend to handle the case that a (accurate) claim includes a position, but the opening base price of that position can't be established preciesly?

Thanks for any clarifications
-- Ichthyo

2- not sure. I'll have to check and repost here. I think they are being closed at 5 (not sure though).
...

...Do you email people to notify them that you've sent a payment? Do people get emails notifying them that they're accurate and just in a queue for payments?

...

People have been asking for this from day 1 and this is the answer you have ?  "5$, not sure"

You've not answered, I suggest you send notice before and after sending payment... to avoid sending to wrong addresses.

I'd swear I had answered this.

Anyways shorts close @ 4.9 longs @ 5.1

I don't believe it was ever answered.  Are you in charge of doing the disbursements now?  It would be nice if there was like a timetable for payouts.  I may be one of the few, but like most/all of my money was tied up in this.  If we could get a reasonable timetable with our first 50% payouts that would be excellent.  Thanks.

+1

I am in the same position. I big part of my funds are locked up as well.
Please help genjix.