Author

Topic: Regulation is an obligation : MyCoin Disappears with Up To $387 millions (Read 796 times)

member
Activity: 93
Merit: 10
these problems can be solved with bitcoin itself (think multi sig and customers owning private keys), but if you use an old model (exchange), of course the same old problems arise (fraud/scams).

on another note, they were operating a ponzi scheme as a main business (promising high returns without solid business backing), the exchange is just a side business.
legendary
Activity: 1232
Merit: 1011
Monero Evangelist
OP: Build your own regulated coin! Leave us alone!
legendary
Activity: 1372
Merit: 1014
"No one seems to know who is behind this," one investor told the paper. "Everyone says they too are victims... but we were told by those at higher tiers (of the scheme) that we can get our money back if we find more clients."

to answer the question, how to determine if it is a Ponzi.  Grin

...and of course what Gox has been doing, delaying and blocking withdrawals

So far the other major exchanges don't to that so they don't look like Ponzis but even an honest exchange can be hacked.
legendary
Activity: 1316
Merit: 1000
Hello,

This is not the first time , this is not the last time ...

I think that regulation is an obligation to protect the investors.






There are scams all over not just in the bitcoin world, bitcoin makes it a little harder to track.  Things like this will keep happening while their are idiots puttings money into wrong investments.
legendary
Activity: 3276
Merit: 2898
we don't need any regulation, only learn a simple rule:

DO NOT HOLD YOUR BTC ON THIRD PARTY EXCHANGES – BE YOUR OWN BANK

https://bitcointalksearch.org/topic/dataexchanges-their-way-of-using-a-fractional-reserve-and-generate-inflation-945881
full member
Activity: 134
Merit: 100
stop asking for regulations, regulations are not going to help you but only to limit you and protect your masters, do you prefer live on a chain all your life? don't you realize that even with regulations there are frauds and scams every day?
legendary
Activity: 1778
Merit: 1043
#Free market
Hello,

This is not the first time , this is not the last time ...

I think that regulation is an obligation to protect the investors.


https://mycoin.hk it was a ponzi scheme,  a ponzi it is illegal in almost all the nations of the World. How can you regulate a ponzi scheme?

how do yuo know it was a ponzi? supposition or facts?

As I read here :

- http://www.ibtimes.co.uk/bitcoin-exchange-mycoin-disappears-250m-suspected-ponzi-scheme-1487170
- http://www.scmp.com/news/hong-kong/article/1708308/mycoin-director-quit-one-month-bitcoin-platform-changed-trading-rules (new article)


*"A suspected Ponzi scheme surrounding the Hong Kong-based bitcoin exchange MyCoin has left around 3,000 investors high and dry to the tune of around HK$3bn (£254m), according to reports.
The South China Morning Post revealed that the sudden closure of MyCoin followed a suspicious recruitment drive for investors that promised prizes such as a Mercedes-Benz car if investors found new clients."
legendary
Activity: 1246
Merit: 1011
It s not that simple : How can you know if cex.io, zeushash or btc-e ... Are ponzi schemes or not ?

You don't.  All you can see is that some groups have better reputations than others.  A service which have been standing for many decades and has a transparent profitable means of using that reputation is far less likely to be a Ponzi than a two-month-old service which has attracted huge amounts of money on the promise of high interest payments.

For example, I'd suggest that:
bitkonan.com is more likely to be running a Bitcoin Ponzi than coinmate.io
coinmate.io is more likely to be running a Bitcoin Ponzi than bitstamp.net
bitstamp.net is more likely to be running a Bitcoin Ponzi than goldmoney.com

I might limit myself to 200 mills (200 millibitcoins = 0.2 BTC) on bitkonan at any one time to try out their site but I could comfortably put 40 BTC in the hands of goldmoney.com.

There are many other factors which can help a person decide the likelihood of losing money through fraud at an exchange:
  • Transparency;
  • Clear, potentially profitable long-term strategy;
  • Contact information for the owners;
  • Insurance (where the insurance company is likely independent of the exchange and itself has a far better reputation);
  • Endorsements by highly respected members of the community;
  • Approval of specialised reputable services which attempt to evaluate the trustworthiness of exchanges.

In this context: regulation is roughly just approval by the government, an admittedly large and long-standing entity but still capable of error or foul play.  It does not make it certain that the regulated exchange is not a Ponzi, just far less likely.  There is no magic pill; there's risk in everything.  Indeed, there are many here that would argue that various governments are themselves running Ponzis.

I don't support it but I certainly admit that government regulation can do a lot to boost the reputation of a small Bitcoin exchange in the eyes of many.  What I don't see is why those that want government regulated exchanges also want ALL exchanges to be forced to comply with government regulations.  Why can't the regulations be optional?  Why can't the government maintain a list of the exchanges it regulates and approves for those that value government regulation to reference?  Why should I be denied the freedom to risk my money with an unregulated exchange when I can only hurt myself?  I guess this falls in with the "gambling should be illegal" idea but I can't be sure.

Finally, be wary that government regulation is often advertised as keeping the exchanges in order and protecting the investors but often it comes bundled with a whole load of anti-money laundering and know-your-customer regulations which certainly work against the interests of the customer.
legendary
Activity: 3668
Merit: 6382
Looking for campaign manager? Contact icopress!
The best regulator should be your brain.

* Don't be lazy. Use wallet on your HDD. Use safe methods (offline-generated paper wallets?) for big amounts. Trust nobody.
* Everything that's too good to be true, it's definitely a scam (Ponzi included).
* Research and learn. Don't fall for each advertising you hear. Ask for second opinion.

* Keep your computer free of viruses, be careful at phishing attempts.


As simple as that.
legendary
Activity: 1512
Merit: 1012
I think that regulation is an obligation to protect the investors.

No.

Use true wallet.dat ... and not the virtual wallet of the exchange.  Roll Eyes
full member
Activity: 224
Merit: 100
Hello,

This is not the first time , this is not the last time ...

I think that regulation is an obligation to protect the investors.


https://mycoin.hk it was a ponzi scheme,  a ponzi it is illegal in almost all the nations of the World. How can you regulate a ponzi scheme?

how do yuo know it was a ponzi? supposition or facts?
newbie
Activity: 15
Merit: 0
It s not that simple : How can you know if cex.io, zeushash or btc-e ... Are ponzi schemes or not ?
legendary
Activity: 1778
Merit: 1043
#Free market
The real question is : how can we regulate the bitcoin companies (brokerage, cloud mining ..) to protect investors from ponzi scheme?



It is simple , don't invest in the various ponzi schemes. It a simple rule, but a lot of people don't "respect" it.
newbie
Activity: 15
Merit: 0
The real question is : how can we regulate the bitcoin companies (brokerage, cloud mining ..) to protect investors from ponzi scheme?

legendary
Activity: 1778
Merit: 1043
#Free market
Hello,

This is not the first time , this is not the last time ...

I think that regulation is an obligation to protect the investors.


https://mycoin.hk it was a ponzi scheme,  a ponzi it is illegal in almost all the nations of the World. How can you regulate a ponzi scheme?
newbie
Activity: 15
Merit: 0
Hello,

This is not the first time , this is not the last time ...

I think that regulation is an obligation to protect the investors.




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