Bitcoinica MtGox account compromised

[BCB]

- Tihan was fired, and no longer acting on behalf of Bitcoinica LP.

Who fired Tihan??

[BCB]

- Tihan was fired, and no longer acting on behalf of Bitcoinica LP.

Who fired Tihan??

I'd assume the investment fund that he represented.

Don't assume.

genjix, could you elaborate??

Thx.

[genjix]

- Tihan was fired, and no longer acting on behalf of Bitcoinica LP.

Who fired Tihan??

I'd assume the investment fund that he represented.

Correct.

[HorseRider]

It's really irresponsible. First they let the 2 hacks happen, blame each other, then all of them quit and left this chaos to the police. Left behind all the users who used to trust them.

I have invested in Bitcoinica not only because of Zhoutong, but also Intersango, which has the core developer of Bitcoin.  I have not registered on Bitcoinica until very recently of the previous hack.

This is really disappointing news. Genjix, I appreciate that you're the last person left here to deal with the users, however, it's still disapointing news.

[tbcoin]

From the beginning have done everything wrong, lengthening the process and here we are. Now that beginning to reimburse, then steal you a third (=~33%) of the money earmarked to pay claims and everything stops. If stolen you a third , are still intact two-thirds. Pay the remaining =~66% now, and then do whatever you have to do.

[guruvan]

Well. I think I'm done. You guys go right ahead and sue these guys. It's already clear there's really not any significant money left to make payments, so I'm not sure what suing will do for us at this point.

Honestly, the only thing I will support at this point is criminal charges being brought against the individual team members. I am quite sure one or more of them would be found guilty of theft and fraud.

What I'd like to see at this point is Intersango shut down before those funds are looted from those customer accounts. I'd like to see some kind of warning tags applied so that people here know that these guys are responsible for the losses of rather large quantities of customer funds, and should not be trusted with anything.

I'd support a lawsuit that would result in the closure of Intersango in addition to the return of Bitcoinica funds, but unless we're actually going to get rid of the real problems, I don't see the point.

I also presume, that if there IS any money left in the bitcoinica coffers, that WILL be stolen before it can be repaid. I somewhat presume that any theft is really a fiction, providing show and theater for the funds that had already been lost.

I might support a lawsuit, if only to find out WTF happened at MtGox to allow that $40K USD to get transferred SO much faster than any other customer gets funds transferred.

But, nah. It's not going to have any real effect. It's certainly not going to get my money back.

Criminal charges are what we need. The money has been gone for longer than they've been claiming "theft" so I can't see any point in going after what isn't actually there. 

[HorseRider]

when police man comes in, there will be more people can touch the money. Then there will be another "hack", I guess.

[DarkEmi]

@genjix : cant you at least refund 50% to all the claim that have been marked as accurate ?

[bitclown]

Coins have begun passing through the payout address again. Anyone received anything today? I hope we'll get our share before it's donated to the lawyers.

[rebuilder]

So basically, currently Bitcoinica seems orphaned. For things to go forward, whoever is in control of Bitcoinica LP needs to start acting. However, no party is willing to admit they are in control, probably because that would put them in a very nasty position, legally, and therefore nothing can happen.

Bitcoinica holds assets of course, but the liabilities are greater by far. Someone is responsible, legally, for dealing with this whole mess, but none of the candidates necessarily want to find out who that someone is, so they're not likely to spend too much time looking into it. An external probe may be the only way to get things moving again.

That said... I'm not keen on the idea of litigation around this issue. That cat may be out of the bag already, but I rather wish it weren't so. This may become the first serious legal look into the Bitcoin economy, with all its curiosities, and the case has in one way or another entangled not just Bitcoinica, but the Intersango operators and Mt. Gox as well. This could get really ugly.

[coinft]

when police man comes in, there will be more people can touch the money. Then there will be another "hack", I guess.

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He might incur losses due to the underlying BTC price rising, and people would cry foul even more than over open positions now, but at least there would be some assets to distribute (eventually). I am confident even lawyers can't take a bigger cut than criminals do now.

[teek]

@genjix : cant you at least refund 50% to all the claim that have been marked as accurate ?

Those big accounts that want to sue, I bet they sure would love their 50% back.  I know I would.     "More is lost to indecision than a bad decision."   sure seems to be ringing true here..  

[lonelyminer (Peter Šurda)]

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He can (and should) rather put them into cold storage. These are deposits of Bitcoinica's customers, noone should have an authority to sell them.

[coinft]

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He can (and should) rather put them into cold storage. These are deposits of Bitcoinica's customers, noone should have an authority to sell them.

Only if he understands bitcoin, which is unlikely. He has to prevent further losses foremost. He has the authority to sell off and close customers positions if that's in their best interest long term, and it is better than getting more assets stolen. I assume much of the details here depend a lot on the jurisdiction this will end in.

[teek]

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He can (and should) rather put them into cold storage. These are deposits of Bitcoinica's customers, noone should have an authority to sell them.

Only if he understands bitcoin, which is unlikely. He has to prevent further losses foremost. He has the authority to sell off and close customers positions if that's in their best interest long term, and it is better than getting more assets stolen. I assume much of the details here depend a lot on the jurisdiction this will end in.

there is almost no way that if this goes into the hands of a 3rd party with some type of official / legal obligation such as a receiver or such that any assets will remain in bitcoin unfortunately... 

[rebuilder]

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He can (and should) rather put them into cold storage. These are deposits of Bitcoinica's customers, noone should have an authority to sell them.

Only if he understands bitcoin, which is unlikely. He has to prevent further losses foremost. He has the authority to sell off and close customers positions if that's in their best interest long term, and it is better than getting more assets stolen. I assume much of the details here depend a lot on the jurisdiction this will end in.

How would you seize Bitcoinica's assets, at least the BTC, without giving whoever controls the private keys the opportunity to transfer the funds to safety?

[imsaguy]

- Tihan was fired, and no longer acting on behalf of Bitcoinica LP.

Who fired Tihan??

I'd assume the investment fund that he represented.

Correct.

so even though Tihan is out of the picture, the investment fund is not.  Who is the new contact?

[coinft]

No. A judicial overseer would first secure all assets. That might mean immediately converting all BTC to $ and putting it into a safe bank. Since the appointed overseer can be held responsible for some losses accrued during his reign, you can bet he will play it safe.

He can (and should) rather put them into cold storage. These are deposits of Bitcoinica's customers, noone should have an authority to sell them.

Only if he understands bitcoin, which is unlikely. He has to prevent further losses foremost. He has the authority to sell off and close customers positions if that's in their best interest long term, and it is better than getting more assets stolen. I assume much of the details here depend a lot on the jurisdiction this will end in.

How would you seize Bitcoinica's assets, at least the BTC, without giving whoever controls the private keys the opportunity to transfer the funds to safety?

Really easy. Choose a registered professional. Hold him legally responsible. Win.

[defxor]

- Tihan was fired, and no longer acting on behalf of Bitcoinica LP.

Who fired Tihan??

I'd assume the investment fund that he represented.

Correct.

According to posts by those two persons themselves, [at least] two persons knew the LastPass password and, more crucially, that the password was insecure (i.e, not randomly generated but a known string).

One of those persons was Tihan - who selected it, the other Zhou - who knew where it came from. It will be interesting to hear, whenever that might be, where all the USD went - something MtGox seem to have information on according to Mark's posts.

(And I'm sure lots of people here would be interested in seeing the IP address from the X-Originating-IP field in the hotmail-sent "Your LastPas pasword is" mail quoted earlier by Zhou)

As to the source code release itself, which is the reason why the known string became useable for both an inside as well as an outside intrusion - the latter much more implausible, I believe the question marks as to its origin still haven't been cleared.

[rebuilder]

How would you seize Bitcoinica's assets, at least the BTC, without giving whoever controls the private keys the opportunity to transfer the funds to safety?

Really easy. Choose a registered professional. Hold him legally responsible. Win.

That's assuming the registered professional you choose holds the private keys, and is the only one with the keys.