Topic: Mtgox can only run insolvent! (Read 5942 times)

He is done for. He is going to be mining a lot coal at this point to pay everyone back. Unless he wins the lottery that 400 million dollars. he will never have a penny to his name.

[11:58] Do you think if it were regulated it would make it easier to work things out?
[11:58] partially
[11:58] How so?
[11:59] well, first avoid being blocked by banks and governments around the world
[11:59] if regulated, it means that as long as you follow the regulations you're fine

Hold on here Anon - WTF has Govt. had to do with Mt Gox going tits up ?

But I agree about trusting 3rd parties [in the absence of regulation] being problematic.

What would a decentralised exchange work like in practice ? How would it be implemented ? Where does Ethereum fit into all this ?

Incorrect. Regulation makes everything less predictable because fitness is stomped on, e.g. Mt.Gox fiasco caused by regulation. Rather it is the liquidity (market cap and velocity) that make a currency predictable and stable. It may be that those have always been seen together in the past, thus people conflate them. But it doesn't mean an decentralized regulation of order (i.e. Proof-of-Work) couldn't become deep and liquid and fitness isn't stomped on because the degrees-of-freedom are unlimited still, thus being stable and reliable.

Do you have any idea how much money they were making the last half of 2013?
Gox was on a pace to easily make back everything stolen by the USA Feds. The only real question is how much they lost this year, and they claim to have had most in cold storage.
Long Live the Great Gox!  

Believe it or not, mtgox can easily get out of this mess.   It's its customer that will get burnt.


Just think about this.   No one can currently withdraw USD or Bitcoin from their mtgox accounts now and people are trying to sell their bitcoins at mtgox at a deep discount....  now, what if mtgox create a bunch of dummy accounts on their own exchange and buy up all these bitcoins for its customers at a deep discounts and pays for them with non withdrawable USD back to their customer's accounts?   Then come tomorrow, they announce they are not insolvent and have enough Bitcoins in reserve for everyone to withdraw?   Bitcoins in mtgox will now skyrocket as everyone with these non-withdrawable USDs in their account will have to pay a premium to buy their bitcoins back before and then withdraw them?   Buy low, sell high, suddenly, all of mtgox financial problem will go away.   The only people that will get burnt are their customers. 

Placing your balances in the hands of third parties means effectively government has complete control and can destroy the apple-cart with regulation and seizures at-will.

On this issue of having accounts to pay with instead of use BTC base money (i.e. cash), I already pointed out upthread that if I must have a zillion separate accounts, it is going to drive me crazy. I already have too many accounts on the internet to keep track of.

Instead a dominant set of providers would take over and we are right back to VISA, Mastercard, and Paypal again. Nothing gained. Why did we waste our fucking time inventing Bitcoin then.

So I entirely disagree that we need accounts for most things. We can build services that operate on the block chain without needing store funds in an account for those services. We can pay as we go, utilizing the block chain. This is the future.

We need less overhead in our lives, not more. Accounts are proliferated overhead and/or centralizing. We need decentralized freedom.

Also if accounts are holding our balances then they will naturally end up leveraged, i.e. fractional reserves. This is a repeating phenomenon throughout the history of man. We needed accounts when base money was gold, but we don't need them now. Our technology has improved. Money is no longer physical.

To backup our keys without giving a masterkey to a coinbase, we need to have physical copies of backups. Use a Print key or copy to removable memory card. Your software should tell you when to print/copy and store in your physical safe. If you find it more convenient and safe to have coinbase hold your masterkey, then you are giving up your anonymity because they will need to identify you if ever you lose your password.


As I explained upthread, a design is possible to bring each block chain confirmation down to 30 seconds or less and avoid the orphaned blocks.

Please don't be disingenuous to imply it is not possible. If you are merely stating that no altcoin has yet done such a holistic design, then I agree with you.

I agree MT Gox probably made a hand over fist in transaction fees last year. Although the Feds confiscating 5million dollars. Them moving into a hotel. Another company suing them for 75 million dollars. There is no way they have enough to survive.

The question is how much are owed to Gox users and how many will withdraw at that point. If they have 20k worth of cold storage BTC. MT. Gox will be alright.

Do you have any idea how much money they were making the last half of 2013?
Gox was on a pace to easily make back everything stolen by the USA Feds. The only real question is how much they lost this year, and they claim to have had most in cold storage.
Long Live the Great Gox!  

MT.Gox is basically when someone gets hit by a car and ends up in comatose. It being held up in life support by other bitcoin exchanges and the community itself.

Pokemon Mark Karapeles is toasted. There is no way he can recover MT.Gox from all those seizures by the Feds. Unless everyone in there mother helps him out. Which no one will do because he single handedly destroy bitcoin image and rep within a week. By blaming it on a protocol issue that everyone in there mother knew 1 year ago. I wouldn't be surprised that he gave hackers "a way" to steal BTCs from others. He threw us all under the bus beside the MT. Gox users.

I hope whatever this Pokemon goes, the BTC community drives him out. Probably the only place he is welcomed is in Antarctica.

It bothers me that the community doesn't stop using Gox. They have been major participators, or arguably even the instigators, of more than half of the major price crashes for bitcoin yet people still go back.

I'd imagine the 'last straw' would be the idiotic blame game Kappels (or whatever is name is) put on bitcoin to cover Mt Gox's incompetence, or, the huge evidence of insider trading that recently surfaced, but if I had to bet, knowing how things didn't change in the prior crashes they caused, people will go back to them anyways, and it kind of sucks.