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Head Of Collapsed Mt.Gox Exchange Arrested With Half A Billion In Bitcoin Still Unaccounted
Back in its 2013 heyday, when bitcoin soared from below $100 to over $1000 in the span of a few months (in no small part thanks to the collapse of the Cyprus banking system) there was only one real Bitcoin exchange: Magic: The Gathering Online Exchange, or Mt. Gox as it was better known, which had become the world's largest hub for trading the digital currency. And then, as mysteriously as it had appeared, Mt. Gox went dark, and filed for bankruptcy after nearly half a billion dollars worth of bitcoin "disappeared."
For a case study of a blistering rise and an absolutely epic fall of an exchange that i) was named after Magic: the Gathering and ii) transacted in a digital currency which many have speculated was conceived by the NSA nearly two decades ago and was used as a honeypot to trap the gullible, look no further than Mt.Gox which after halting withdrawals for the second (and final time) has finally done the honorable thing, and filed for bankruptcy. As the WSJ reports, "Bitcoin exchange Mt. Gox said Friday it was filing for bankruptcy protection after losing almost 750,000 of its customers' bitcoins, marking the collapse of a marketplace that once dominated trading in the virtual currency. The company said it also lost around 100,000 of its own bitcoins. Together, the lost bitcoins would be worth approximately $473 million at market prices charted by the CoinDesk bitcoin index, although the price of Mt. Gox bitcoin had fallen well below that index after it stopped bitcoin withdrawals in early February."
The punchline: speaking to reporters at Tokyo District Court Friday after the bankruptcy filing, Mt. Gox owner Mark Karpelès said technical issues had opened the way for fraudulent withdrawals, and he apologized to customers.
"There was some weakness in the system, and the bitcoins have disappeared. I apologize for causing trouble."
In other words, oops sorry, several hundred million in Bitcoin is unaccounted for but blame the "system weakness." This promptly led to various artistic interpretations on the Mt. Gox logo, such as this one:
Some were confused if Karpeles was going to get away with nothing more than an excuse, even if - as many speculated - he had personally fabricated exchange data entries and embezzled millions of dollars for his own account.
As a reminder, when it filed for bankruptcy in February 2014, Mt. Gox said 750,000 customer bitcoins and another 100,000 belonging to the exchange were stolen due to a software security flaw. The lost funds represented the equivalent of $480 million at the time of the bankruptcy filing. Mt. Gox also said more than $27 million was missing from its Japanese bank accounts. Karpeles, who had blamed hackers for the loss, later said he had recovered 200,000 of the lost bitcoins.
Earlier today we got the answer when nearly 18 months after his infamous apology, Mark Karpeles was arrested in Tokyo. FT reports that Japanese police have arrested Mark Karpelès, the head of the bankrupt Japan-based bitcoin exchange Mt Gox. The arrest charge is that he made an illegal entry to the system in February 2013 and increased the balance of his account by $1 million.
And yet, a year and a half after the exchange insolvency, nobody truly knows what happened:
The alleged crimes involved are hard to pin down, say police sources, because of the absence of a specific laws governing the virtual currency. Police have acknowledged privately that there technical elements of the alleged disappearance of nearly $500m that “are still not properly understood”.
Asked by Mt Gox to look into the matter in March Last year, the Tokyo Metropolitan Police were not able to begin their investigation until three months later. Even then, say people close to the investigation, the two police departments in charge — the cyber crime unit and the white-collar crime unit — did not properly share information.
The year long investigation, say legal experts, has culminated in an arrest that will allow police to hold Mr Karpelès without charge for 23 days. If he continues to deny any wrongdoing during that time, police may alter the charge, and hold him for another 23 days.
While Karpeles may very well be guilty of embezzlement and massive fraud against his clients, could it be the still undetermined "crimes" relating to a virtual currency will become just the excuse to keep unsavory suspects detained and/or under arrest for an indefinite period of time? Because being held for up to 46 days without any charge seems a little Guantanamoish.
As the FT adds, "the case has exposed both the complexities of crime relating to the bitcoin virtual currency, and the profound difficulties encountered by the Japanese police as they have attempted to investigate the Mt Gox."
Seemingly the complexity was not as big as that encountered by US regulators and police who 7 years after the greatest criminal systemic collapse, and after the statute of limitations has now expired, have yet to arrest anyone for a multi-trillion systemic crime far greater than Karpeles' $500 million embezzlement.
As for the former Mt. Gox head, today's arrest will hardly come as a surprise as it was expected for over two weeks: Japanese journalists had been encamped outside his Tokyo home for several days. Footage of him being led from his home to a police car showed Mr Karpelès wearing a T-shirt and a baseball cap.
Mt. Gox bitcoin firm head arrested - The Japan News http://t.co/t4xFsyCsNy
#mtgox #Bitcoin #?????? pic.twitter.com/A2M8Lyz7px
— The Japan News (@The_Japan_News) August 1, 2015
Mr Karpelès could, if found guilty, face up to five years in prison or a fine of as much as Y500,000 which at today's exchange rate is just over $4000.
So let's do the math: steal $500 million which only you know where it is, spend 5 years in prison, and be fined $5000. Sounds like a pretty good deal...
Anyone curious for more, there was an AMA this morning with a person representing to be Ashley Barr, the first Mt. Gox employee which gives more insight into Karpeles various pathologies. It can be found here.
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Forget Bitcoin!!!Start stacking silver!!! Great time to buy! Let them manipulate those prices downward. We all know that free markets eventually win-out. What else can you buy BELOW the cost of production??? Your electronic digits, dollars, stocks, bonds, 401ks, etc. will all be worth zero at some point.
Gold and silver will always have value! I know most ZHers know this already. Here is a great way to get friends and family interested in securing their wealth in real, tangible assets: https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu
Hopefully, they will also learn to question more things, especially the Fed!
Copper jacketed lead is the best investment.
Yes, they will hold their value, at least until more advanced weapons are produced. Gold and silver have been money for thousands and thousands of years. Well before the invention of gunpowder!
I would make sure you get stocked up on that as well, at least to protect your stack!
Karpeles will not like being in a Japanese prison. They are reputedly unpleasant.
* * *
The very nature of Bitcoin likely means that there will be plenty of scandals in the future.
If you jump in, be careful!
The math and encryption behind BTC are very interesting though: two hashing functions and an elliptical curve technique. Here is a fun little tool to play with that gives you an idea of what hashing functions are like:
http://www.xorbin.com/tools/sha256-hash-calculator
Yes, what a dope for staying in Japan, at the scene of the crime.
The problem with Bitcoin is that it needs computer technology.
Where's Waylon Bits?
Hanging with the boys.
The boys being trolls.
Still safer than gold, if it's stolen you are never going to find out where it went.
Who could have know'd someone would be shystered by a guy with a tribal name! ._. my shocked face
Publicus
It depends...:
www.coinalytics.co/tools/tracker.html
EDIT: Col. Klink, I misplaced this reply to (Publicus), but let me take this opportunity to say "Hi" to you again.
Why is everyone who doesn't own gold so scared of it being stolen? You don't think I wear all of my silver around my neck do you?
:)
SG
I've wondered that too. Sure are a lot of Gold Haterz. And I doubt they own any, LOL...
Same with silver.
Stay frosty amigo! :)
... I'm waiting for comments from some of the bitcoin-pushers on this site ... ;)
So who was it that said that this shit was untouchable safe? Hmmmmm?
Excuses excuses excuses, yeah but it wasn't this, but was that, etc., etc., etc.,
Buillshit.
bitcoins...tssssss... why not wifi credit card.... ohh wait !
An important clarification: The Bitcoins in the Mt. Gox case were never "lost" or "missing". Bitcoins cannot go missing and cannot ever be lost, unless all of the thousands upon thousands of computers that are storing and updating the blockchain decided to delete those files.
The more correct description is that Mt. Gox (allegedly Mr. Karpeles) "lost control" of other people's Bitcoins. This is not the same idea. If you lose control of your Bitcoins, they are no longer yours, but they are never missing or lost, they only changed hands.
This misrepresentation by the media makes it seem that Bitcoin is less secure than it really is. Now, fiat money on a digital bank account ledger - those can truly be "lost" or frozen, by the simple push of a button by the ECB as the Greek depositors found out - something that could never possibly happen with Bitcoin.
A bar of gold stolen from a safe which was in your name didn't go missing or become lost. It only changed hands!
Quit dissembling! This is like the practicing alcoholic who can always stop tomorrow.
Hey gang let's sing along with Scooby! OK?
Scooby Dooby Doo where are you?
I'm over here transitioning into a Bitsexual.
And Scooby Dooby Doo why did you do that?
I'm all about the crypto!
Hi I'm Caitcoin you want to buy me?
https://www.youtube.com/watch?v=gUdG0RYd6jk
Hope he shares a cell with that piece of filth COrzine.... oh wait...
How many people bought from Mt. Gox on his recommendation? Guilty by association. Let's string him up.
/NSA sarc tag
The problem with Bitcoin is that it is extremely susceptible to fraud. Much moreso than national currencies, which have some sort of legal procedures to protect against fraud, and more than most stocks, except the most questionable unlisted ones. It's like buying stocks back in the 1850's, where there were almost no safeguards and scams were everywhere.
If you read the specialized Bitcoin discussion boards, you will read story after story of people who have been defrauded, or otherwise lost track of their Bitcoin "investment," and in every case up will pop a Bitcoin fanatic supporter accusing the person of negligence or ignorance of basic computer security procedures, but looking more closely shows that these victims are generally knowledgeable concerning computers and software. They are not totally ignorant fools who deserved to lose their money to these carnival sharks.
The Bitcoin and especially the alt-coin world is filled with get-rich-quick con artists looking for a quick buck stolen from the pockets of those they consider to be "greater fools." The only defense of the Bitcoin sharks is that their victims are usually also in it for a quick buck, since birds of a feather flock together.
Furthermore, Mt. Gox is just the tip of the iceberg as far as fraudulent and bankrupt crypto-exchanges are concerned. Mt. Gox is not an isolated case in a world of honest and conservative financial institutions. It's the Wild Wild West, with banks failing or getting robbed constantly.
If you get involved in "investing in Bitcoin," be prepared to lose it all.
It has been rightly said here on ZH---hundreds of times--- that if you don't have it in your possession and under your control, then you might not really own it, whether "it" is bitcoin or PMs. But in the case of bitcoin, what constitutes full possession and control? The uncrackability of its encryption? I just don't feel enough confidence in that to commit my hard-won (and laughably-inadequate) savings to it.
In the case of PMs, it's obvious what "full possession and control" looks like, and it doesn't take a leap of faith to feel confident about it.
what constitutes full possession and control?
Full and exclusive possesion of private key(s) to bitcoin account. I.e. Gox was a custodial account, where keys were with Karpeles and not its users. This is precisely the wrong thing to do in bitcoin.
The uncrackability of its encryption?
Mathematics. Bitcoin is mathematically provable, so you don't have to trust it. Just run the proof yourself.
I just don't feel enough confidence in that to commit my hard-won (and laughably-inadequate) savings to it.
So don't put your savings in it. Put some petty cash, say $20.
But first and foremost, money is just the first application of bitcoin network. It is as hard to imagine what comes next as it was in the '91 internet to imagine WWW.
If it's so fucking safe, how have people had their stuff stolen?
No, I don't want to hear any excuses. Their money is gone. Period, disappeared, stolen, unrecoverable, nada, zip, zilch, bye bye.
Safe, my ass.
If it's even peripherally connected to ether-space, it is not "yours" and "yours" alone. Period, EOC.
edit: @knuks
If it's so fucking safe, how have people had their stuff stolen?
-
Great logic there knuks. I currently own gold and btc. My bitcoin is impossible to steal from me as I have taken security measures available to me that my gold does not offer me, these measures I shall not discuss. My gold, while being very well secured, is not impossible to be stolen. There are 100s of gold robberies for every bitcoin loss, and I have not even mentioned gov gold confiscation, an impossibility when it comes to the decentralized, libertarian minded bitcoin.
So, using your totally unbiased logic knuks, gold must be unsafe yes? (That is a rhetorical question the purpose of which was to evince you of your idiocy) Talk sense or go to fox news with your fearmongering. Yes, the omniscient tylers have consistently lampooned btc, but their ad revenue is predominantly gold sellers, which could explain both why tylers have been bullish on gold @$1900, and bearish on btc since it was $2.
I figure I would requote one of the many esteemed bitcoin critics on zerohedge in the hope that he, or the 95% of you retards still dissuaded from ever analyzing bitcoin for yourself because the $1900 gold pushing tylers of zerohedge have scared you away from what they ignorantly perceive as potential competition, will hopefully realize how you look as stupid as those who call gold a barbarous relic.
So, under an avalanche of people gloating about how unsafe btc is because it could be stolen IF you give it to a third party, we find this gem from soul glow:
-
Why is everyone who doesn't own gold so scared of it being stolen? You don't think I wear all of my silver around my neck do you?
-
That logic tho.
"get-rich-quick con artists looking for a quick buck"
You should not talk about Reggie Middleman like that.
https://www.youtube.com/watch?v=gUdG0RYd6jk
In my experience the more complex something is, the easier it is to committ fraud. Just look at the ponzi scheme Federal Reserve. There is a reason why the people have not raised up in defiance against it...They do not understand it. They get lost and bored with all the talk of reserves, intererast rates, treasuries talk.
Here is a open and transparent monetary system that works: gold and silver! The way to commit fraud is to make counterfits, but at least that is out in the open for our eyes to see and our hands to touch.
And counterfitting is very hard, if not impossible to do in smaller units of measures (ounce coins)
Actually counterfeiting of bullion coins has reached a crescendo with the current crop of Red Chinese products on the market. As a dealer counterfeits have been the greatest source of stress in my shop.
We have the means the authenticate every item offered to us but counterfeiters are constantly improving their products and seeking ways to deceive the latest testing methods.
http://www.alibaba.com/product-detail/America-Regional-Feature-and-Art-C...
These are very scary and mean that any coins offered must be thoroughly scrutinized.
This sort of thing doesn't mean you should avoid gold or silver specie. It just means you should be careful in your dealings and stick with reputable and knowledgeable dealers.
Thanks for that link, it certainly was an eye opener. Can anybody tell how China, who are the masters at conterfeiting and intellectual theft, get away with conterfeiting sovereign coins such as the gold eagle and Kruggerands? Why aren't the Secret Service all over this and prosecuting alibaba and the chinese company producing these fakes? That alibaba listing had a list of all the tests the coins would pass, so it is not selling them as a "novelty", but as a coin that will fool people into thinking they are genuine.
I guess I should have been more clear. Their fraud is out in the open. Respected coin shops can spot these counterfeits with a few tests. You should buy from a local coin shop that has a good reputation (and been in business for awhile, not a we buy gold place!).
Plus you can buy cash and not have the digital paper trail.
Indeed, when I took out one of my Gold Eagles and compared it to the pictures on the site, the difference in the quality was evident, but the fakes would pass muster with the average person. Again I ask, isn't this a blatant counterfeit of a sovereign coin in violation of international laws? It is no different than conterfeiting a fifty dollar bill.
As you may be able to tell, I am more than a little pissed about this
Looks great to put in a safe and hide in obvious holes around the yard. Photoshop some invoices to put next to them. Spray painted airsoft guns to make this safe look like the intruder has struck gold!!!!
Can you link to silver ones too? Don't forget the magic cards to keep this on topic.
After I adblocked the scum spam on that site, it was very interesting, thanks!
Re "Karpeles will not like being in a Japanese prison. They are reputedly unpleasant." OK then, I vote for a firing squad. Or, the electric chair.
Just wait until the phased plasma rifle in the 40 watt range gets here!
https://www.youtube.com/watch?v=BIPCn-aYMoM
Fiat is Fiat
Exactly...If you can't hold it, you don't own it. The REAL value of a digit in an electronic system is ZERO!
Another example, as you say, "If you don't hold it..."
Incredible how difficult it is for some to learn that simple rule. Very thick skulls.
We will soon call those who fail to understand that rule looters, beggers, and corpses.
Good thing bitcoin isn't fiat in any way.
...aaaand it gone!
No wonder there's so much financial crime. The risk/reward ratio is off-the-charts in the thieves' favor.
They could check his refrigerator to see if he hid it there but clearly that's already stocked.
Notice how the Bitcoin fanboys are noticeably quiet on this one.
Mt Gox's failure wasn't a failure of Bitcoin - it was the failure of an exchange. Think MF Global.
Itchy bitchy
Right on. When a bank gets robbed no one blames the money! Come to think of it -- what he did is the same as the banksters do, except -- the bankers are more patient.
A bunch of idiots chasing the price of Bitcoin thinking it was a get-rich quick scheme give all their BTC to an exchange that was designed to trade trading cards. I bet that half of those who had their BTC stolen still don't even understand what a BTC is, what it is good for, or how their own stupidity led to their loss...
The bankruptcy of Mt Gox was one of the best things that could have happened to BTC - it shook out the get rich quick retards, and has led to BTC being much less volitile - and useful..
get rich quick retarded? except many did get rich quick, didn't they? i sense some kind of warped morality by people who refer to people as get rich quick schemers. they saw the potential and rightfully attained gains. but apparently they are idiots? because ... they made money contrary to your system of controlled risk mitigation through a slow regular process? you don't have to worry your system works just fine for your purpose. you have no reason to be insecure
I will rephrase it for you.
Giving money to an exchange that was designed to service a video game = retarded.
Buying a product/currency/commodity without understanding what it is, how it works, how to store it securely, etc.. = idiotic
Blamming the product/currency/commodity for the defect after YOU GAVE IT TO A CROOK = childish
Losing money because you jumped on a bandwagon that you didn't understand, and lost everything = oops
Getting rich quickly because you identified a bubble, understood the risks, timed the market = all the power to you
I don't have a problem with people getting rich quickly by taking risks. If you make a fortune by surfing bubbles - good for you. If you lose money by always being the one holding the bag, your opinion doesn't mean much to me - stop blaming a technology that you (still) don't understand...
Magic the Gathering is a card game, where they traded cards on that site. Not sure if I am helping out the street cred for MTGoX. Though the govt. selling bitcoins might have helped.
Waylon Bits, paging Waylon Bits...
anyone seen Corzine recently??
Failure of an exchange, NOT the block chain or BitCoin.
There, fixed it for you. BitCoin Fanboys are not quiet on this one.
The first rule of holding Bitcoin is to store them in your personal wallet. These idiots got what they deserved. No different than buying paper gold. They should chalk it down as a stupidity tax.
Fonestar is hiding under Karples bed waiting for the coast to clear.
That brings back memories lol.
Perhaps Fonestar is Karpelès.
Maybe phoney-star is hiding IN Karples' bed. Waiting for the next earthquake.
" The dog ate my bitcoins ...."
Funny enough, if you hold your bitcoin on a paper wallet, it's a perfectly plausible situation.
By the way, you SHOULD store your bitcoins on a paper wallet, with encryption, and in multiple copies. Only put some betty cash in bitcoin onto your phone.
Looks like they arrested more than just his head.
Bitcoin is anonymous, how can anyone catch the case?
Thumbscrews. Get his wallet IDs and private keys.
I never went in to BitCoin. Reason: If my regular bank account can be hackcked and thwacked, so can BT.
Keep it in strong hands. I studied the 1929 crash. Everything was Great--- Until it wasn't.
Hold on to solid commodities and hard goods, IMHO.
BC is a great thing--in theory. Nothing beats 1 in the hand vs two in the bush.
Yup. And silver is the bet buy right now. Stack silver until other hard assets come down in terms of silver price (ie gold and real estate)
‘Everything was Great--- Until it wasn't.’
That’s what makes Trump interesting. All we need is a few ‘leaders’ to turn the heard… right into Balkanized Anarchy!
It's gonna be epic.
My old ZH partner in crime discussed this this morning. I set up a low risk account without any transactions. Blockchain. See what happens. BTC has huge spread variations. Not spending, watching the bank account holdings of 1.05 BTC.
No loss if someone rapes $280 dollars. Will make a call to have his computer overclocked. It will end the future thievery within this experiment.
:)
What crimes...?
:)
The idiot who steals $280 dollars out the account.
Me: ring, ring
Friend: hello
Me: IP address xxx:xxx:xxx:xxxx:xxxx:xxxx:xxx:xxxx. Nuke it.
Friend: consider it done.
Me: thanks, hangs up
Hacking a wifi, VPN's, proxies, tunnels, etc. Its pretty easy to change your IP. Change the MAC address on your router, reset the cable modem, new IP. You could just MITM attack people in a Starbucks.
If you really care about it, put it in cold storage. Make a wallet ID on a clean computer, only connected long enough to enter it into the blockchaine, and write it down, along with the private keys. On a piece of paper.
After that, the security of your bitcoins is equal to the security of your piece of paper. There are places that will etch your wallet and key as a QR code on a piece of stainless steel, but that part is optional.
We don't care about the money lost. Phishing and baiting. The IP address is encrypted. Testing authentication and trusted sources.
Once hole is found, they get zapped. Those poor fucker's will lose the entire network and cloud based system.
Boohoo.
Here are two cold storage options I have found that work great:
www.ledgerwallet.com
www.mytrezor.com
Keep the bulk in cold storage, the rest in a hot wallet like blockchain.info. But, be careful......
EDIT:
Long and involved thread, but many hardware wallets discussed:
https://bitcointalk.org/index.php?topic=899253.0
As I recall, bernie madoff and hundreds or thousands of others have stolen much more in the form of fiat, metals, etc.
Have you checked to see if your gold is merely plated tungsten?
So don't disparage bitcoin in ignorance of what BitCoin even is.
Woops. Another senior moment.
If BTC is non-governmental, what makes what he did illegal?
It's still theft, like stealing a sack of non-governmental apples or gold.
But did they find Corzine yet?
Liberty is a demand. Tyranny is a submission..
... you just won the Internet!
A few years back I was using Bitcoin in a small way. Every website dealing with Bitcoin urged you to go to Mt.Gox for all your buys, sells and for wallets. Bull Shit! I smelled this fucking rat out long before he stole it all. I never went near that fuck. I got Bitcoin one to one form holders through internet matching. I rotated wallets never staying too long in one place. This was smart, one wallet I had had coin in shut down one day and nobody every got a coin back. I was gone by then. After giving it thought, I sold out and replaced Bitcoin with Maple Leafs. Bitcoin is great in theory, awful in practice. Too easy to steal, no wallet is safe, no exchange is safe.
What made me get out was how huge Bitcoin was in Russia, and Russia has too many great hackers, they know how to own your wallet before you have a clue anything is wrong.
For now, much as I like Max Keiser, Bitcoin is not safe.
you're being a little being dishonest or uninformed. It is only in the third party storage that is unsafe. the ironic thing is that having an offline bitcoin wallet is hypothetically the safest way to store an asset because it's virtually impossible to steal. even a safe can be broken into. burying your gold/silver can be found or lost. like anything else risk depends on a variety of factors, but with regards to bitcoin it has the highest potential of satefy among all the assets. but if you store it on an exchange, well that's different. that's sort of like giving your gold to some small warehouse down the street who promises to keep it safe.
Jack is actually right (not my red).
Exchanges are very dangerous places for BTC. blockchain.info (a great site, but...) has a nice "hot wallet", but I have had problems.
The only time I ever lost BTC in a clever little scam, however, was my own fault for not being wary...
The safest places to store BTC are the hardware wallets ("cold storage"). My links to Ledger and Trezor are elsewhere in this thread.
When I was looking at Bitcoin years ago every site said use really long strong passwords on the personal wallet, because they were possible to crack the passwords. Didn't the govt crack someone's password with a lot of BTC in it? I don't remember reading anywhere to trust storing these in 3rd party sites. I mined Bitcoin and Litecoin for a while just to understand what was going on at the time and how they differed. Even if you think this is the dumbest thing on earth its interesting to follow and understand.
See, this is exactly my point. Here we have a relatively sophisticated user who got scammed using Bitcoin, due to making an obscure error that most average people wouldn't even understand.
So how can average people use Bitcoin? Basically, they can't without exposing themselves to risks that lead to a quick loss of Bitcoin assets to scammers. One small slip-up in security and you're gonzo.
But suppose you say: "Bitcoin is not meant for technically ignorant people. Only experts should be using it"? Then Bitcoin cannot achieve widespread usage, and most people agree that widespread usage is necessary for Bitcoin to have value. If only a few computer jocks play around with it, then Bitcoin never becomes a useful Medium of Exchange, and its value sinks to de minimis.
ALthough I recognize its problems, the dollar has a big advantage, namely, that you don't have to be a genius to use it. In fact, you don't even need to be literate beyond being able to understand 1 dollar, 5 dollars, 10 dollars, 20 dollars, and you don't even need to be able to count your change, since any amount less than 1 dollar is hardly worth anything anyways. This is what I mean by widespread usage. The cabbie who can barely speak English can read the taxi meter and figure out what you owe, without having to understand cryptographic encryption codes and multi-factor security methods.
Using Bitcoin is a bit easier than mining BTC's. People should be securing their online banking with long strong passwords as well. The big difference is in a bank account the bank is supposed to guarantee a certain amount of money, compared to BTC 3rd party storage its just gone. I don't see BTC being mainstream anytime soon, but then again Paypal wasn't used on many sites for years after it came out. I wouldn't use paypal without 2 factor authentication. How many people are using 2-step on accounts tied to money or personal data?
I can think of a few good uses for BTC right now that aren't for illegal purposes. You can look at Snoop Dogg for what happens when someone finds out you are carrying too much paper currency in another country. But its a-okay to use a credit card for huge purposes.
I wonder if Karpeles is jewish.
"I wonder if Karpeles is jewish."
https://en.wikipedia.org/wiki/Karpeles
LOL
Quelle surprise!!
Real life vampyres. Countries through history have learnt the hard way not to invite them in. Unfortunately political class' weakness for money seems to result in those valuable lessons being erased and forgotten.
The NSA should tell the world where the missing BitCoins are. It would help their PR
Is the bitcoin still alive? or has it been disappeared?
Alive and still being traded https://markets.blockchain.info/ shows the volume and can change the chart time ranges, the chat box has not worked for months though. https://coinmarketcap.com/ shows many cryptocurrencies
https://www.bitstamp.net/ is the exchange that was hacked in January, recovered well no-one lost bitcoins as far as I understand, bitstamp lost $5.1m. They dropped trading fees for the customers when the re-opened a few days later as a 'sorry' and to encourage trading.
Embezzle millions in virtual currency and you will get arrested, embezzle trillions in fiat currency and virtually nobody gets arrested.
Bitcoin appears to be safer than Federal Reserve Notes in form of 1's and 0's in the bank, 401k, etc but I prefer holding my money, if you don't hold it you don't own it.
Wonder if there was concern about in what juristiction here should be arrested and where tried. Talk of prosecution of financial crime is generally near treasonous and will possibly point to contradictions in the decision to prosecute.
But in Japan you have a bureaucracy that opted not to press charges against people of influence who nuked something like 25% of its land area.
I think I am going to go ride one of my non-digital Harleys with all of it's chrome, steel and loud pipes. I was getting pressured to buy into bitcoin by some folks I trust but I wouldn't. I never bought into the idea because I can't see how it can work. I buy metal, some of which I can ride. It seems a better deal to me.
Where is Fonestar these days?
I had an 03 sportster with some loud pipes, chrome and steel are some precious metals that hold their value and are also fun to hold.
and in a Pinch, my precious metals get 50 MPG and my lead goes even further... and faster
It amazes me how dumb so many zerohedgers are about bitcoin. I always thought most zerohedgers were pretty much above average intelligence which seems to be true still all except for the topic of bitcoin. It is the ONE thing the so many zerohedgers are completely clueless about. Anytime there is any sort of article which shows someone getting ripped off because they decided to keep a large amount of bitcoin on an exchange and thus NOT HAVING POSSESSION OF THEIR PRIVATE KEYS all the retards here start saying i told you so. Well DUH!!! Its like if you were to open up an online bank account and letting someone you dont know have your password. Maybe they will take your money. All of this MtGox stuff happened back in a time when the only exchange that was really around was in Japan. Why was it in Japan?? Because the US wouldnt allow one to be here. Now there are many more exchanges that allow multi-sig so that if you must use an exchange with large amounts of BTC, they cant steal your coins because they only have part of the key. Also no haker ever ever ever ever period has ever been able to guess a private key stored offline, which is what you should do with the bulk of your bitcoin!! I am dissapointed at the lvl of intelligence here. Its the main reason I dont even bother to comment most of the time anymore. If you want to talk about bitcoin get some, use it, learn alot about it before you go spreading mis-information. Unless of course all of you haters are just government paids on here to try and turn people away. Totally possible.
And how do you secure your private keys? Hmm? Computer? Slip of paper stashed somewhere? USB stick?
"I always thought most zerohedgers were pretty much above average intelligence "
Big mistake. Most Zhers can only repeat sound bites from ron paul, gold bugs and of course, my favorite, "it's all the fault of the Joooooooosssss!!!!"
There was for sure at least one person who the govt. got the password from. Because the govt. sold the bitcoins. Whether it was cracked or beaten out of them, it was for a lot of bitcoins/$USD/whatever. Its pretty easy to find the person by searching "seized bitcoins" in your favorite search engine. Staying under the radar would have helped in this example.
Using Bitcoin is even more complicated than I had thought!
In addition to understanding mathematical cryptography, computer security, selecting the correct Bitcoin software, and knowing when to buy and sell Bitcoin on the financial markets, you also need to have enough skill in counter-intelligence to avoid having some modern-day James Bond wheedle your Bitcoin password out of you after feeding you a few spiked martinis.
This narrows the potential pool of Bitcoin users down to about 1/100 of 1% of the population: not enough to form a viable currency. The stakes just keep getting higher.
But he's a frenchman !
How can the country of Voltaire produce such a bunch of shady entrepreneurs who sell their soul to MONEy ?
I mean the big guys not the small guys ! Not the traders but the string pullers !
Who are the string pullers and those who kneel to the power of the TBTF ?
The list is long but to give you a hint just look as those who run the country or who "headed" the IMF since 40 years!
Its all there the French strain of : the best things of life are free (so taught me the Enlightenment) but GIVE ME MONEy !
Bitcoin?
Electronic money?
You are crazy!
I'd rather buy a manure truck to leave my money in the clouds!
hehe.
The "Bitcoin-Meister", "CrazyTech" and other Pissed-Their-Pants Diehard Bitcoin Promoters seem Conspicuously Absent, no?
Same as it ever was ..
To try and prove a point to all the haters here. Here is my public bitcoin address 1SYcgB3Y3M3kVHB2m7Gmmz8Vg9sgjWEQx
there are 3 bitcoins in this address. If you dont believe me copy and paste the public key into the search bar over at blockchain.info I task all of the best hackers on the planet to come and get these bitcoins. Should be easy enouf right?? All you have to do is figure out the private key that derived from this public key. Go!! I'll be waiting.......... If any of you know anything about SHA256 and asymmetrical encryption you would know by the laws of mathmatics that this is virtually inpossible. the possible addresses we are talking about is 2^160. there are more atoms in the known universe. Good luck to you!! You see I hold my public keys. Just like alot of you gold bugs on here talk about holding physical. The problem with people getting their bitcons "stolen" is that maybe they never had them in the first place once they put them on an exchange, or handed over their private keys.
I spent a few hours this morning educating myself about bitcoin. I missed the boat back when BTC was between $6 and $11 or so and I just gave up trying to comprehend the technology and never bought any. DOH!
Though I created a wallet today, I am still not satisfied with the reliability because of the extreme volatility. Can't the price fall drastically if one or more of the larger holders sell off? And WHO are these holders and what is their aim? If the aim is purely profit from investment, I can go along with that and take my risk accordingly. But what if one or more large holders are entities which can create money from thin air (governments, banks) and suffer no losses when it is gone and who just may want to take BTC down? Who is Satoshi?
Some of my concerns are based on these articles I read:
https://www.cryptocoinsnews.com/bitcoin-whale/
http://blog.p2pfoundation.net/who-owns-all-the-bitcoins-an-infographic-o...
https://bitcoinmagazine.com/6021/bitcoin-is-not-quantum-safe-and-how-we-...
Get that shit out of here.
Satoshi: the man, the myth, the legend.
The bitcoin idea itself is fine, But, the single main issue with bitcoin: the reliability of the exchanges. You can not ever guarantee that someone didnt' write a bug into the exchanges software that will allow them to siphon off some of your money, and even without you knowig about it. And, no one is watching the till.
With crooked SOB's like Karpeles in the game, forget about it.
Nostro: you got the BEST moniker of anyone in ZH land. Ever.
I'm guessing there are probably a few scores of computer savants on earth who can figure out how to crack or fabricate Bitcoins.
I'm guessing there are ZERO supernovas on earth producing more gold.
The whole thing is about human morals when it comes to coining a new frontier.
If Cristopher Columbus is a scammer we are phukked.
If he is a passionate new frontiersman who honours Hippocrates's sermon we are saved.
Those who work for humanity cannot lie and must leave an Indelible and transparent trace.
Why? Because their adventure is bigger than Man, its like what Galileo said or Micheal Angelo did : he painted Man as equal to his maker. No better way of heralding the Humanist age! The end of Obscurantism is on the ceiling!
Imagine if Neil Armstrong's trip to the moon were a fake!
That's whats at issue here. If block chain monetary creation allows us to short circuit this incredible betrayal of Bankster and Political collusion; alike the collusion of feudal kings and dogmatic church of old; to scam the world; we have hope of a New frontier where we can checkmate this disease just like Hippocrates's legacy; or that of Aristotle to checkmate obscurantism now a resurgent disease, pardner to the OIL oligarchy scam game!
Its like finding a true cure to Aids or eBola, thats not a honey trap for humanity and another "Madoffian scam" for Oligarchy; the sons of Atreus. A game that never ends.
Just like many of other zerohedgers here I hold phyical. Its an important part of my investment portfolio. And like most zerohedgers here I believe that if you dont hold your physical then you dont have your gold or silver right?? Well bitcoin is the same way. If you dont hold your private keys offline for the bulk of your "savings" bitcoin then you might not own your bitcoins. I keep a small amount in my "hot" wallet for quick transactions that store my private keys on my phone. Its the same concept as physical. And THAT is what happened over there at "empty gox". He had everyone's private keys, so he had everyones bitcoin. Pretty simple.
BREAKING NEWS: "DOOFUS007 cheated in a World Of Warcraft online game, gets caught"
so tell me again how great and wonderful bitcoin is and how it avoids all the problems with fiat paper money and how technology will save us and how.......
Wait, the magic the gathering online exchange is not FDIC insured?
THE TRUTH IS ...
The FDIC isn't "FDIC Insured"
Hahahahahahahahahha!!!
There is too much ignorance here to fight, but I'll try.
When a bank holding gold gets robbed, you don't question the gold, you question the bank. This bank failed. Kind of like back in the days of....you know.....freedom? You make a decision to put your money somewhere and suffer the consequences of that decision, and Auntie Yellen isn't going to come save you with her printing press. THE HORROR!
Right, so that's what happened. Shouldn't we be celebrating a free market? No, instead you bitches are crying about how it's not FDIC insured and how it's a big joke, when this is exactly what SHOULD happen in the kind of free market some of you claim to espouse. A shitty exchange with lots of warning signs took a lot of people's wealth and dissapeared it. Doesn't change anything about the currency, and it's good that institutions like that are failing, so we can get to some solid, trustworthy entities. Do you think JP Morgan or Citi or BoA aren't frauds that would fail tomorrow without trillions in printed fiat propping them up? Isn't it a VIRTUE of bitcoin that Mt.Gox failed and no one is bailing them out?
Bitcoin CAN be extremely secure. No person or machine on earth is going to guess the keys generated for the bitcoin you own, so if you store keys in offline storage, you're fine.
The two main objections I continue to see here are these: No intrinsic value and what if the power goes down
Intrinsic value: Bitcoin's intrinsic value is the blockchain it is on. It is a permanent, immutable, distributed ledger. That's all it is. But if you don't think there's value in having a timestamped, 100% tamper-proof, public and transparent ledger for the entire world to write on, you're being willfully obtuse. Being a third-party to verify financial transactions and prevent double-spending is trillions of dollars of the global economy, annually. Bitcoin's blockchain can do the same task of proving the legitimacy of a transaction of value using mathematics, without a third party or government approving it, and at zero cost.
If you don't think that has MORE intrinsic value than a shiny piece of metal with limited industrial uses, you're insane. If you're not excited about a programming protocol that could make every financial "professional" in the world irrelevant.... a money that is A) not inflationary, B) outside the control of governments, C) cannot be bailed in when the banks go tits-up, then I have nothing to talk to you about. But opinions and obituaries for bitcoin are irrelevant. The blockchain is a protocol....it was invented in 2008 and it's not going anywhere. It's going to change the world and implode some systems of power in the next few decades, and you can either ride that wave (hopefully to greater freedom, truly free markets, and less government) or you can get crushed by it. Governments are eventually going to put up a fight or try to coopt it when they realize it's going to negatively impact their revenuing, but the smart people are going to be able to opt out of the state's controls and financial systems, entirely. If you value your freedom, please read up on this stuff and learn about it. These are tools to experience true freedom in your lifetime, if you do your homework.
Power outage: if electrical and communication grids go down, we've got a lot bigger problems than medium of exchange. And since 99% of fiat transactions are digital now, power outage takes them down, too. In such a scenario, silver and gold won't help you, but ammo and food storage will. As solar becomes more viable, and micro-grids/mesh networks bring decentralization to electricity production and internet access, respectively, there won't be any central point of control or failure for electricity or communications/internet access. Put faraday cages on your shit and ride off into the sunset.
That future's coming.
"Power outage: if electrical and communication grids go down, we've got a lot bigger problems than medium of exchange. And since 99% of fiat transactions are digital now, power outage takes them down, too. In such a scenario, silver and gold won't help you..."
Leaving aside your as yet undefined declarative statement, apparently you've never been through a hurricane or it's aftermath. BitCoin will cease to be any kind of medium of exchange right along with the gas card you're trying to use to get gas from filling station, that uses electric pumps to get gasoline out of underground storage tanks and the cashier can barely add or subtract anyways so they can't "make change" even if they could open their register, once again, powered by electricity.
Perhaps if you could actually find your solar panels that were ripped off during the storm (suggestion, start outside a ten block radius of your house) and reinstall them you might be able to make & sell some ice from your front porch though, provided you have a non-contaminated potable water source, all cash & coin, of course.
But naturally, by then the power (hopefully) will be back on.
No junks from me though and I think you may have missed this other little issue:
http://motherboard.vice.com/read/the-mystery-behind-the-biggest-bitcoin-...
Regards ;-)
Yeah, and the moment you get ripped off, (credit card and identity fraud is extremely common), you have no legal recourse.
That reason alone is why Bitcoin is fatally flawed.
nothing jamie and lloyd don't do every day.
lesson #1: if you're gonna corzine other people's shit you had better be wearing the right set of cufflinks.
So your 2 big problems with BTC is #1 if the grid goes down then we cant use bitcoin. Valid concern for sure. And #2 the recent spam attack and also in the article someone sent a transaction with almost a full meg of data embedded to take up the whole block. Okay, #1 first. Sure if ther whole grid goes down for goodn then using bitcoin would be impossible for most, sure. Im not giving a shit about bitcoin if the power goes out for good. I would also argue good luck getting any of your dollars out of the bank if the grid goes down for good. Having said that I have personally sent and recieved bitcoin via VHF radio using a digital packet radio protocol call Olivia 2000. It is very robust and works even under heavy static(bad signal) conditions. I can operate my station for years without electricity using my solar panels. Im not even kidding. I realize this is not an option for 99 percent of people, but like I said if the grid goes down its like plan d or e anyway. #2 regarding the recent span attack, this was like a blip on the radar, almost all transactions are stil going strong without issue. If this were to continue in frequency I assure you that the core developers will change the protocol to not accept blocks with spam. Another feeble attack, another day bitcoin learns something and gets stronger. I am glad it happened, always good to test the protocol to see where we can improve. As far as the full meg issue, they are allready working/debating on changing block size. The core developers will make the right decision in the end and the miners will adapt, once again bitcoin will grow stronger.
Bitcoin can make you rich - just start you own exchange and swipe everyone else's bitcoins!
"nothing jamie and lloyd don't do every day.
lesson #1: if you're gonna corzine other people's shit you had better be wearing the right set of cufflinks."
SLAM DUNK !!!! Hahahahahaha!
Good one!!!
THE STUPIDITY of the Bitcoin fiasco ... is that NO cheating was necessary.
They could have operated the whole concept so it was legal - and made it work. The basic idea was fascinating. They just needed to stay honest and fight the good fight.
So much rampant dishonesty in the world today. If HUMAN BEINGS come close to going extinct on this Planet, we can't really ask "Why?".
Corruption everywhere. The US is the new banana republic.
Whoa..what's the problem here..some guy creates a new form of currency..loses or steals some of the money...and all hell breaks loose..the US takes in (money) taxes every year..and is short a trillion dollars..they sell you a piece of paper called a bond..and will not be able to repay..so they will create another piece of paper called a bond..and use that money to pay you back...you know..like a ponzi scheme..and nobody cares..this guy does the same thing...but I guess he cannot create a "bitcoin bond"..
i had a MtGox account but i could never understand why to have bitcoins with MtGox if i can have them on my computer.
Yes it takes space to hold the whole bitcoin transactions ledger on your computer but then the bitcoins ARE ON YOUR COMPUTER
so his employees find a bug in the software his company uses, and he worked on, that allows hackers to steal from customers accounts. He tells his employees "Don't fix it!", steals tens of millions, we have no accurate report on exactly how much he stole or how long he was stealing, and he gets "up to $4000.00" fine? Yeah. There's justice in the world. Hang the SOB.
Prolly has his thunb (drive) up his ass. Only half a bill. who's counting.
Wow...Is Corzine next???? HAHAHAHAHA
Thats the truth about digital currency :
IT TAKES ONLY A FRACTION OF A SECOND TO ROB BILLIONS
Its great for thieves in modern times