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Bitcoin Businesses The Almighty Buck

MtGox Files For Bankruptcy Protection 465

Posted by Soulskill
from the all-about-the-bitjamins dept.
Sockatume writes "The beleaguered MtGox bitcoin exchange has officially filed for bankruptcy protection in Tokyo. According to the Wall Street Journal, Bitcoin held an impromptu press conference that addressed recent rumors. They state that they have over $60m in liabilities against just $30m in assets, and confirm the loss of over $500m worth of Bitcoins, split between customers' balances (750,000 BTC) and company assets (100,000 BTC). Owner Mark Karpeles said, 'There was some weakness in the system, and the bitcoins have disappeared. I apologize for causing trouble.'"
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MtGox Files For Bankruptcy Protection

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  • by davecb (6526) <davec-b@rogers.com> on Friday February 28, 2014 @10:04AM (#46366919) Homepage Journal
    The Gox Crater: Crowd Detectives Reveal Billion-Dollar Heist As Inside Job [falkvinge.net]
    Thousands of volunteering and self-organizing detectives have been meticulously laying a puzzle that reveals the Gox billion-dollar heist as an inside job. As smoke clears on the implosion of the Empty Gox bitcoin exchange, thousands of people in the community committed to revealing the truth behind the stonewalling exchange. What was claimed first to be a technical problem, then an outside theft, has been conclusively determined that the MtGox management knew too much, too long ago, to have this be an ordinary case of theft.
  • Re:Ha ha (Score:5, Interesting)

    by Anonymous Coward on Friday February 28, 2014 @10:27AM (#46367113)

    For a start, I doubt you understand what FUD means.

    I also fear you didn't actually read the article, just summary borked by Slashdot "editing".

    I'm uncertain what they meant to say, but I guess they meant either "Bitcoin Foundation" (Karpeles was one of board members there and now resigned) or "Bitcoin exchange" (i.e. MtGox).

  • by JoeyRox (2711699) on Friday February 28, 2014 @10:34AM (#46367177)
    When they lost $500M in Bit Coins, most of which belonged to their customers? Are they not treating customer deposits as a liability? Shouldn't that interest be represented in the bankruptcy proceeding?
  • by wiredog (43288) on Friday February 28, 2014 @10:35AM (#46367183) Journal

    From the AP Story [washingtonpost.com]

    a weakness in the exchange's systems was behind a massive loss of the virtual currency involving 750,000 bitcoins from users and 100,000 of the company's own bitcoins. That would amount to about $425 million at recent prices.

    The reactions of the various Japanese government officials are interesting. Essentially, there was no "theft" because Bitcoin is not a "real" currency. Which is an interesting attack. Anyone can steal your bitcoins and you have no recourse to the law because it isn't actually theft.

  • Re:Bitcoin did what? (Score:2, Interesting)

    by pla (258480) on Friday February 28, 2014 @11:03AM (#46367443) Journal
    Half a billion dollars worth of bit coins just disappeared, well, was just publicly announced as disappeared.

    No, they didn't. Every single Bitcoin in MtGox still exists, you can track them down in the block chain, and in this specific case, someone even still has access to them .

    MtGox didn't lose BTC, they lost transactions (or rather, double-counted them in one direction) due to a flaw in their implementation. MtGox "lost" nothing more than an imaginary number on their balance sheet. Doesn't matter if they denominate that number in BTC or USD or Yen, still equally meaningless if they don't have controls in place to notice money walking out the door. Though stemming from a technical error, the failure of Gox has more to do with the failure of their accountants than with what services they provided or currencies they dealt in.


    The fact that this happened AT ALL is a direct reflection on the very core design of BitCoin, and its not a bug, its intentional. Short sighted, but intentional.

    Yes, actually, this does directly reflect the core design of BitCoin - And one niggling little detail that Gox failed to grasp. If you can't swim, son, don't jump in the deep end with the bigger boys. Though not really "short sighted", insofar as the protocol works just fine if you don't cut corners based on false assumptions about it.


    Your currency is one for criminals.

    Explain that to Patrick Byrne. Then learn about who and what you malign before opening your mouth again. Then go fuck yourself, on behalf of the vast majority of us who use BTC in entirely legitimate ways.


    "Seriously dude, open your eyes."
  • by pla (258480) on Friday February 28, 2014 @11:20AM (#46367549) Journal
    so you can predict performance then?

    No. I can "predict" that:
    1) Existing BitCoin advocates won't suddenly say "oh, wow, guess I should delete my wallet now".
    2) Joe Public now knows about BitCoin ("no such thing as bad PR" and all that); and
    3) More interest in scarce resources drives their price up.

    Interpret that however you want. Past performance is no guarantee of future results. This post contains forward-looking statements inherently susceptible to uncertainty and changes in circumstances. YMMV.


    Sounds just like those stock pump-and-dump spam emails I get.

    The part you, and most BTC haters don't get? The lack of a "dump" phase. I like BTC more for the philosophy behind it than for the practicality of using it - Much the same as FOSS. If it appreciates in value, hey, I've made a few bucks, not going to complain - Much the same as FOSS saving me from buying Windows/Office/Adobe/etc. And if it loses value because people like you can't stand seeing other people enjoy something new, well, no one can say I didn't do my part to help it along.

    FWIW, I've taken my own advice here, so feel free to call me whatever you want - I can console myself with the 25-50% gains over the next three months. I don't use BTC primarily for that reason, but I sure as hell won't pass up the opportunity.
  • Re:Ha ha (Score:2, Interesting)

    by jythie (914043) on Friday February 28, 2014 @11:47AM (#46367763)
    Which is why crypto-anarchists are seen as elitist snobs. They are the digital equivalent of people who think it is better to learn MMA then have a police force and thus the 'only way' to solve a problem just happens to be the same solution they themselves are good at.

Nobody said computers were going to be polite.

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