6 ms·

The poster makes some good points about the inconsistencies in Mt. Gox's handling of things, but it seems to me that he's ascribing to malice what is well expla

by kwantam 15y ago

The poster makes some good points about the inconsistencies in Mt. Gox's handling of things, but it seems to me that he's ascribing to malice what is well explained by incompetence on the part of the person or people running the site. The security practices are appalling, and their lack of clarity on the counter-party issue is damning. If I were Kevin---or, indeed, any customer of that exchange---I'd take my money and go elsewhere. Still, it's pretty astounding how myopic the rest of the Mt Gox forum users appear. They're taking a situation that's beyond a doubt the fault of the Mt Gox admins and getting ready to lynch a dude who seems to have acted rather reasonably (intentionally not exploiting a known loophole to exceed the withdrawl limit, reporting his disposition immediately to the site's maintainer, et cetera).

lubos 15y ago
you see, majority of bitcoin forum audience are traders themselves. they are in for money and they are jealous.
- cantbecool 15y ago
  The poster does not seem like a malevolent person at all, but he was clever enough to post the $0.0101 bid order before other buyers in line knew what happened, and the commenters on the Bitcoin forum are clearly jealous. Well played, toasty.
  - cloudwalking 15y ago
    He didn't place the $0.0101 order. "I also decided against this, when I realized that whoever placed the gigantic sell order was probably doing so for the exact same reasons and I knew how that would make me look."
    - abraham 15y ago
      "I had to try several times, but eventually I got a buy order in, offering to buy as many bitcoins as I could for $0.0101." He did place the $0.0101 buy. Your quote is regarding withdrawing the bitcoins from Mt Gox.
  - Tichy 15y ago
    He stole 600+ BTC, though. And now he resents giving back the BitCoins that are supposed to be "rolled back". Not so benevolent in my opinion.
    - anigbrowl 15y ago
      No he didn't. He withdrew them as proof of concept. Right now it's not even clear who he should give them back to. Furthermore, unless he caused the selloff there was nothing wrong with putting in his $0.0101 order. I suspect the bitter people on the bitcoin forum are the ones who had $0.01 orders in and assumed that fractional values would be rounded down the the nearest cent. They were hoping to make some easy money from others' misfortune and are angry because they were outwitted.
      - ChuckMcM 15y ago
        The 643 he has are 'worth' $10K at the $17/btc rate. That would be triple the $3000 he 'had in his account' so either way that would be not a bad return on $3K. Raises other questions about whether clients can 'conspire' to hold records of sales (vs rolling back the transactions). In real 'cash' situations you have to give back the actual currency, in a bitcoin world its a rollback of the sell record, but now you've created Heisencoins have you not? Sold by some accounts, not sold by others? Interesting to watch the intersection of the protocol and the reality.
        anigbrowl 15y ago
        I'm thinking of doing some bitcoin trading myself. It's like finding a free herd of sheep; eating them would be naughty and possibly illegal, but I'm seeing good opportunities in fleecing them and selling woolly sweaters to keep out the chill.
      - Tichy 15y ago
        As a proof of concept he could have withdrawn 0.01 BitCoin, no need to max out on MtGox limits. He writes he was aware that probably the hack is causing this and decided to take advantage of it. He should give the BitCoin back to MtGox, who would then proceed to roll back the transactions. Simple as that.
vl 15y ago
>fault of the Mt Gox admins Mt Gox is run in such amateurish way, it's appalling. In real life, with many brokers you trade doesn't close in 3 days and as such you can't withdraw proceeds from the trade for 3 days (but you can use the proceeds to continue trading). In this situation Mt Gox is effectively both exchange and the broker. Not to have rule in place to block funds from recent transactions is like people who designed it never traded real stock with real brokers.
- bobz 15y ago
  The three day settlement rule applies to the NY equity markets. Other markets, including NY fixed income products, run under different rules, including same day settlement. And this isn't a fraud prevention measure, it's a legacy of the days when settlement included someone carting a stack of stock certificates from one bank's vault to another. Lastly, most traders trade on a contractual basis, not a settlement basis, so their trades are considered binding as soon as the agreement is in place.
  - Nrsolis 15y ago
    There are some other important differences: 1. In the US, most exchange operators are the counter-parties to all trades. They also interact with settlement and clearing services that ensure the verification of proper ownership and conveyance of securities. In the old days, something like a third of all trades failed to meet the three-day window because some part of this process would fail. 2. There are very very specific rules regarding how the orders are crossed (buy and sell side) and which orders take precedence in the (limit order) book. It looks like the MtGox guys didn't think this through and the trader in question took advantage of this naivete on the part of MtGox. 3. Most exchanges are "brokered" to facilitate trades while MtGox is more like a swap-meet. Brokered exchanges are more expensive to trade in but they have the advantage that brokers can "know" how to get price-improvement based on market conditions. In short, they are "informed traders" vs the "uninformed traders" you see in most post/notice markets. When the informed meet the uninformed, you see situations like this where someone takes the whole shebang home. Personally, I find it amusing that the Bitcoin fanboys are clamoring for intervention here. It's almost like they are getting to the idea that a strong regulatory environment is a /good/ thing for the free market. If this were the cryptopunk/libertarian paradise that everyone dreams of for Bitcoin, there would be /no/ recourse.
jwdunne 15y ago
I whole heartedly agree. I wasn't actually expecting reactions like that from the forum users so that surprising too. It seems to me that the OP on that forum saw a pattern, proved it was true and then proceeded to tell the appropriate persons. The appropriate persons then realised they'd made a big mess of things and then twisted the truth to create a scapegoat, which is exactly how it's playing out on that forum.

by kwantam 15y ago

lubos 15y ago

you see, majority of bitcoin forum audience are traders themselves. they are in for money and they are jealous.

cantbecool 15y ago
The poster does not seem like a malevolent person at all, but he was clever enough to post the $0.0101 bid order before other buyers in line knew what happened, and the commenters on the Bitcoin forum are clearly jealous. Well played, toasty.
- cloudwalking 15y ago
  He didn't place the $0.0101 order. "I also decided against this, when I realized that whoever placed the gigantic sell order was probably doing so for the exact same reasons and I knew how that would make me look."
  - abraham 15y ago
    "I had to try several times, but eventually I got a buy order in, offering to buy as many bitcoins as I could for $0.0101." He did place the $0.0101 buy. Your quote is regarding withdrawing the bitcoins from Mt Gox.
- Tichy 15y ago
  He stole 600+ BTC, though. And now he resents giving back the BitCoins that are supposed to be "rolled back". Not so benevolent in my opinion.
  - anigbrowl 15y ago
    No he didn't. He withdrew them as proof of concept. Right now it's not even clear who he should give them back to. Furthermore, unless he caused the selloff there was nothing wrong with putting in his $0.0101 order. I suspect the bitter people on the bitcoin forum are the ones who had $0.01 orders in and assumed that fractional values would be rounded down the the nearest cent. They were hoping to make some easy money from others' misfortune and are angry because they were outwitted.
    - ChuckMcM 15y ago
      The 643 he has are 'worth' $10K at the $17/btc rate. That would be triple the $3000 he 'had in his account' so either way that would be not a bad return on $3K. Raises other questions about whether clients can 'conspire' to hold records of sales (vs rolling back the transactions). In real 'cash' situations you have to give back the actual currency, in a bitcoin world its a rollback of the sell record, but now you've created Heisencoins have you not? Sold by some accounts, not sold by others? Interesting to watch the intersection of the protocol and the reality.
      - anigbrowl 15y ago
        I'm thinking of doing some bitcoin trading myself. It's like finding a free herd of sheep; eating them would be naughty and possibly illegal, but I'm seeing good opportunities in fleecing them and selling woolly sweaters to keep out the chill.
    - Tichy 15y ago
      As a proof of concept he could have withdrawn 0.01 BitCoin, no need to max out on MtGox limits. He writes he was aware that probably the hack is causing this and decided to take advantage of it. He should give the BitCoin back to MtGox, who would then proceed to roll back the transactions. Simple as that.

vl 15y ago

>fault of the Mt Gox admins Mt Gox is run in such amateurish way, it's appalling. In real life, with many brokers you trade doesn't close in 3 days and as such you can't withdraw proceeds from the trade for 3 days (but you can use the proceeds to continue trading). In this situation Mt Gox is effectively both exchange and the broker. Not to have rule in place to block funds from recent transactions is like people who designed it never traded real stock with real brokers.

bobz 15y ago
The three day settlement rule applies to the NY equity markets. Other markets, including NY fixed income products, run under different rules, including same day settlement. And this isn't a fraud prevention measure, it's a legacy of the days when settlement included someone carting a stack of stock certificates from one bank's vault to another. Lastly, most traders trade on a contractual basis, not a settlement basis, so their trades are considered binding as soon as the agreement is in place.
- Nrsolis 15y ago
  There are some other important differences: 1. In the US, most exchange operators are the counter-parties to all trades. They also interact with settlement and clearing services that ensure the verification of proper ownership and conveyance of securities. In the old days, something like a third of all trades failed to meet the three-day window because some part of this process would fail. 2. There are very very specific rules regarding how the orders are crossed (buy and sell side) and which orders take precedence in the (limit order) book. It looks like the MtGox guys didn't think this through and the trader in question took advantage of this naivete on the part of MtGox. 3. Most exchanges are "brokered" to facilitate trades while MtGox is more like a swap-meet. Brokered exchanges are more expensive to trade in but they have the advantage that brokers can "know" how to get price-improvement based on market conditions. In short, they are "informed traders" vs the "uninformed traders" you see in most post/notice markets. When the informed meet the uninformed, you see situations like this where someone takes the whole shebang home. Personally, I find it amusing that the Bitcoin fanboys are clamoring for intervention here. It's almost like they are getting to the idea that a strong regulatory environment is a /good/ thing for the free market. If this were the cryptopunk/libertarian paradise that everyone dreams of for Bitcoin, there would be /no/ recourse.

jwdunne 15y ago

I whole heartedly agree. I wasn't actually expecting reactions like that from the forum users so that surprising too. It seems to me that the OP on that forum saw a pattern, proved it was true and then proceeded to tell the appropriate persons. The appropriate persons then realised they'd made a big mess of things and then twisted the truth to create a scapegoat, which is exactly how it's playing out on that forum.