Topic: [ANN Mt.Gox] It’s been an epic few days: What happened? - page 3. (Read 4042 times)

Alex, you mentioned the verification issue.

It's really unclear to me what is going to happen with this when US/Canadian users get transferred to CoinLab.  Will the accounts which are currently awaiting verification still be verified by MtGox or will US/Canadian customers be verified by CoinLab following the transition (ie, will those US/Canadian customers currently awaiting verification by MtGox need to start the verification process again with CoinLab)?  

The lack of recent information about the transition is worrying as customers were initially told that they needed to agree to CoinLab's ToS if they wanted to use MtGox following the transition but the information on the CoinLab site says that the funds of US/Canadian customers will automatically be transferred to the US.  

This implies that people will need to withdraw their funds from MtGox before the transition if they don't want those funds transferred to the US bank (which may present difficulties for unverified customers given the backlog on verification) or they'll have to register as a CoinLab user whether they want to or not in order to withdraw their funds.

It was previously stated that MtGox user data would not be transferred to CoinLab without user agreement (ie, MtGox users accepting CoinLab's ToS), but if the funds are being transferred automatically then how will users be able to access them without using CoinLab?

I know you have a lot going on, but the transition to CoinLab has to the potential to be disastrous if you don't keep your users fully informed and - quite frankly - you don't need any more things happening right now which undermine people's confidence in you.

I applaud you for this update and must admit that I was one of the people to go a little overboard.

This kind of communication goes a long way and is something you should do a lot more.

I however maintain that you had a *lot* of time over the past months to get a more efficient trading engine up and - given that it should be *the* top priority - the progress on that front is simply not satisfactory.

I, for one, will be moving to another exchange until Mt.Gox meets the standards that I expect from the leader of the industry.

P.S. Just to have some basis to my claims: I have a strong background in computer engineering, especially when it comes to big & performance intensive systems. I can assure you, I know the challenges that come with hosting infrastructure, a good trading engine, massively parallel architectures. Still, if prioritized the right way, results should have been there a long time ago.

Thanks for the excellent feedback.

There is one thing you can do that's relatively easy.  You guys should consider doing a UDP blast of ticker information to perhaps a dozen volunteer sites who can use this information to relay it into an independently-provided web socket feed so that it doesn't have to go through you.  By UDP, just in case this isn't clear, I mean User Datagram Protocol, the sessionless protocol supported by TCP/IP, the kind of one-way outbound packets you can send from your facilities that shouldn't be affected by an inbound DDoS flood.

Do you have enough reserves to suspend trading and meet payroll/vendor obligations until the new trade engine is ready for prime time (and maybe the verification queue is beaten to within an inch of its life, as well)? Not sure how many strikes against Gox there are going to have to be, before most smart people say "you're out!" and look somewhere else.

Personally, Namecheap is being denied 4 years of domain transfer/renewals of mine because of this insane high-low. I was just about to execute my bitcoin deposit to them before the latest of seemingly countless DDOSs. Bit-Pay loses out on its fee as well.

This thread is a great example of the communication that goes a long way towards defusing those kinds of reactions.

When your customers don't know what's going on they tend to assume the worst.

Thanks for the update

Dear Mt.Gox users and Bitcoiners,

It’s been an epic few days on Bitcoin, with prices going up as high as $142 per BTC. We all hope that this is just the beginning!

However, there are many who will try to take advantage of the system. The past few days were a reminder of this sad truth.

Mt.Gox has been suffering from its worst trading lag ever, 502 errors, and at one point some users were not able to log in their account. The culprit is a major DDoS attack against Mt.Gox.

Since yesterday, we are continuing to experience a DDoS attack like we have never seen. While we are being protected by companies like Prolexic, the sheer volume of this DDoS left us scrambling to fine-tune the system every few hours to make sure that things don’t go beyond a few 502 error pages and trading lag.

Why has Mt.Gox become the target of a DDoS attack?
It is not yet clear who is behind this DDoS and we may never know, but these actions seem to have two major purposes:

1.   Destabilize Bitcoin in general.
It is not a secret Mt.Gox is the largest Bitcoin exchange with more than 80% of all USD trades and more than 70% of all currencies. Mt.Gox is an easy target for anyone that wants to hurt Bitcoin in general.

2.   Abuse the system for profit.
Attackers wait until the price of Bitcoins reaches a certain value, sell, destabilize the exchange, wait for everybody to panic-sell their Bitcoins, wait for the price to drop to a certain amount, then stop the attack and start buying as much as they can. Repeat this two or three times like we saw over the past few days and they profit.

What can be done?
Believe it or not, there is pretty much nothing that can be done. Large companies are frequently victims of these kinds of attacks. Even though we are using one of the best companies to help us fight against these DDoS attacks, we are still being affected.

There are a few things that we can implement to help fight the attacks, such as disconnecting the trade engine backend from the Internet. By separating the data center from the Mt.Gox website, we will continue to be able to trade.

What can you do?
Like our favorite author here at Tibanne says… Don’t Panic!

“Panic-selling is a wide-scale selling of an investment which causes a sharp decline in prices. Specifically, an investor wants to get out of an investment with little regard of the price obtained. The selling activity is problematic because the investor is selling in reaction to emotion and fear, rather than evaluating the fundamentals.” (Source: Wikipedia)

I understand that many of you have a lot at stake here, but remember that Bitcoin, despite being designed to have its value increase over time, will always be the victim of people trying to abuse the system, or even the value of Bitcoin decreasing occasionally. These are not new phenomena and have been present since the beginning of time when humans first started trading.

Trade Engine Lags
Lag affects everyone, not only us, but also major, world-renowned exchanges like the NASDAQ and NYSE. We can fix lag, but we cannot eradicate lag. Only small exchanges with low volume and liquidity are immune to lag.

Does this mean that we are giving up fighting lag? Hell, no. We are working on it by creating a new trade engine that will solve many problems, but it’s not a magic bullet. We can always try to scale our servers, but we cannot predict what happens from external sources: DDoS, panic selling, immediate increase of buyers, etc. Lag will always be there, but our mission is to make lag as small as possible.

Account Verification
As if a major DDoS attack was not enough, we at Mt.Gox are victim of our own success!

Last year, Mt.Gox saw an average of 9,000 to 10,000 new accounts created every month. This number doubled in January, tripled in February, and sextupled in March. In this month alone, March, over 57,000 new accounts were created!

Our support and account verification team went from four people in January 2012 to twenty-two people working every day of the week. We are now hiring even more people to solve this problem by finalizing some deals with external companies.

Remember that even if you are waiting for your account to be verified, you can still deposit or withdraw funds via our Japanese account and make your trades! (Only accounts that we pro-actively required to be verified are limited to deposits and trade only.)

Finally
We have seen a significant amount of comments on the web (various forums, Reddit, etc.) that portray Mt.Gox as a company held by “idiots” and other rather rude words, complaining about inability to deal with lag and other system issues, without understanding the magnitude of work and attacks we are facing every day.

I understand the frustration many of you feel. We hate this situation as well. Since we took over Mt.Gox, we have been through Hell and back and we are still here. We are still the largest exchange with over 420,000 trades per month and  USD $121 million monthly trade volume. We have worked our way through all the requirements needed to run our exchange legally.

Now, there are some things we can improve, but so far we are doing an incredible job that no other exchange has been able to do so far. While I understand a certain amount of frustration, realize what we have accomplished. I appreciate all the work you are doing everyday to push things forward and to help secure the future of Bitcoin

And to all of you who are supporting us on a daily basis, thank you! We could not have done any of this without your help!