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There are similarities to Mt. Gox. One of the most important is the near-complete lack of user panic, despite ample warnings, right up to the collapse. I remem
by apo 9y ago
There are similarities to Mt. Gox. One of the most important is the near-complete lack of user panic, despite ample warnings, right up to the collapse.
I remember vividly seeing Mt. Gox users warned to leave. They didn't. Somehow, they discounted or ignored every warning. Then they became angry when their money was stolen. Then they claimed Mt. Gox was responsible for their loss.
History seems to be repeating itself here. Tether holders somehow don't see, can't see, or refuse to see the writing on the wall.
- conanbatt 9y agoThe difference between mtGox and this is that bitfinex is seemingly infinitely solvent. Some estimates are like 20-30 million revenue per day. Its the top running exchange. I doubt they would expose themselves to a bankrupcy event having such a cash cow. I believe they did market manipulation, and that they are committing fraud with tether, but I'm not convinced tether is not solvent.
- AJ007 9y agoWhat if they covered up other breaches?
- Sangermaine 9y ago>Its the top running exchange. So was mtGox.
- conanbatt 9y agomtGOX was insolvent because they lost all their assets, thats not the case for bitfinex as far as we know. That is independent from tether itself, it can happen to all exchanges.
- Sangermaine 9y ago>as far as we know Yes, precisely the sort of information an audit would reveal. Curious, then, that despite their repeated pledges for robust auditing they first declared they'd engaged a firm to do those audits that didn't actually do audits, then terminated their relationship with the second, legitimate auditor.
- conanbatt 9y agoAn audit of tether would not show you if bitfinex is solvent or not. Even if tether as a project is a total failure, bitfinex could pay at length for its shortcomings. Plus, they made most of the money on the play itself.
- bby 9y agoWho is to say there isn't wash trading going on and that their volumes are fake? Wash trading by insiders who don't pay fees.
- wgerard 9y agoTo be fair, plenty of people tried to withdraw from Mt. Gox and were stonewalled [1]. Which, one can imagine, exacerbated the problem. 1: https://www.reddit.com/r/Bitcoin/comments/1po4gq/mtgox_slow_withdrawals_after_35_days_officially/ https://www.reddit.com/r/Bitcoin/comments/1po4gq/mtgox_slow_...
- apo 9y agoWithdraw of bitcoin was possible for many months while withdrawal of USD was blocked. I can't tell you how many /r/bitcoin posts I saw in the months leading up to the final closure of BTC withdrawal that went something like: "why is the BTC price so high on Mt. Gox compared to other exchanges?" This post gives you an idea. Note the first response and how difficult it is for users to actually see the dead canary: https://www.reddit.com/r/Bitcoin/comments/1w6qxm/mt_gox_arbitrage/ https://www.reddit.com/r/Bitcoin/comments/1w6qxm/mt_gox_arbi... Mt. Gox would accept USD deposits, but not withdrawals. You could move your bitcoin out, but not your USD. There were also shenanigans with trading bots. The post you linked to applies to USD withdrawals only. BTC withdrawals continued for some time, but many users decided to ignore to the dead canary and let the Bank of Gox hold "their" money for them. One of them was a well-known Bitcoin Core developer.
- Gargoyle 9y agoThis is more accurate. There was a relatively lengthy period before the collapse when you simply could not withdraw.
- deleted 9y ago[deleted]
- jmkni 9y agoIt's similar to Bernie Madoff as well. Harry Markopolos spent years trying to warn people that he was running a ponzi scheme, and he was ignored until the whole thing finally blew up.
- Xixi 9y agoAnd they are entirely right to claim that Mt. Gox is responsible for their loss. Writing "scam" on a giant red flag in front of your door is not a valid waiver of responsibility.