Closing long position at 5.1 ? really ?, I would estimate most position were long ones and I have big doubts that you liquidated all positions right after the hack.
If you did, that was a stupid move because the price would have fallen from the event. If it didn't, it just didn't rise as much as it should've.
Apart from this week, You did not state once how position would be liquidated, if you did, show me the post, and lets see what price it was.
(7 day after the hack the price was 5.15 and raised ever since with an average of ~5.6
Your website doesn't say shit yet about positions being liquidated and you obviously didn't send an email either.
If gambling with customers money helped you out recover stolen money, on top of Tihan money, FINE, I've more to worry about.
To be honest, every new minutes that passes I'm worried me that you may loose everything on the main wallet.
Bitcoinica only hedges when there is a change in net position. After shutdown, no change happens so no hedge should occur either.
The open positions for both long and short are almost equal, so there's no profit/loss to Bitcoinica regardless of the liquidation price they set. It can be $100 if they really want to. However, the people with short positions would have been forced to liquidate and there was no way to recover the losses beyond their deposit, it makes sense to choose a price close enough to the market price when liquidation is no longer possible, so that no one will owe anything to Bitcoinica and everyone will be able to get a fair share of refunds.
If you set the liquidation price to $6.5, my estimation is that you'll only get 50% of your money back (unless the shorts pay for their losses by extra deposits, which they won't). For most people they will be worse off.
It's a zero sum game to return the money. Any unexpected benefit for anyone means an unnecessary loss to someone else. What Bitcoinica is trying to do is to make everyone happy with priorities: prevent "real losses" rather than "opportunity cost", making the winners profit less rather than losers lose more.
~= 98.5 BTC
