6 ms·

Mt. Gox new announcement ( February 26th 2014 )

56 points by ing33k 13y ago

Copied from https://www.mtgox.com/ February 26th 2014 Dear MtGox Customers, As there is a lot of speculation regarding MtGox and its future, I would like to use this opportunity to reassure everyone that I am still in Japan, and working very hard with the support of different parties to find a solution to our recent issues. Furthermore I would like to kindly ask that people refrain from asking questions to our staff: they have been instructed not to give any response or information. Please visit this page for further announcements and updates. Sincerely, Mark Karpeles

alexchamberlain 13y ago
Dear Mark, Should you be reading this, please could you answer a very simple question... For each of the currencies you support - including BTC, USD etc: 1) How much do people have in their MtGox account? 2) How much do you have in the bank/wallet? Thanks, Alex
- deleted 13y ago
  [deleted]
- lnanek2 13y ago
  There's a nice chart in the PDF that was leaked, which was later confirmed by him on IRC. It had BTC/fiat currency assets vs. holdings vs. debts, etc.: http://www.scribd.com/doc/209050732/MtGox-Situation-Crisis-Strategy-Draft http://www.scribd.com/doc/209050732/MtGox-Situation-Crisis-S...
shawabawa3 13y ago
Well... At least this update includes some information (he's in Japan). Would be nice if he could mention anything about anything people actually care about (are they insolvent? Have they lost 700,000BTC? If not, how many? etc)
abc123xyz 13y ago
Its funny that people referred to bitcoin as a ponzy scheme Now we know that the protocol itself is actually quite good (despite mtgox trying to blame it) And the problem lies at the interface between bitcoin and the traditional payment systems (exchanges) Its a pitty that Satoshi never solved the problem of distributed TRUSTLESS exchange, tho I suppose that is a problem that didnt exist until bitcoin became popular.
- Cthulhu_ 13y ago
  > tho I suppose that is a problem that didnt exist until bitcoin became popular. Sure it did. Cash money. Exact same problems.
- solve 13y ago
  "Perfect is the enemy of good"
mxx 13y ago
What are the issues?
- venomsnake 13y ago
  Bad case of stealingeverithingus ... usual treatment is long prison term unless you are a wall street dear.
  - NateDad 13y ago
    stealing / losing ... exactly which is a little unclear at this point. Honestly, probably a little (a lot?) of both.
- patio11 13y ago
  If you haven't been following along, the brief version: Mt. Gox is a Tokyo-based company which, most famously, took deposits in dollars, yen, and a few other currencies and also Bitcoin, and allowed people to trade Bitcoin for dollars/etc and vice versa. They charged traders a commission, and so earned a percentage of transaction volume. Transaction volume was massive -- Mt. Gox was the leading exchange for over a year. They had a rough year in 2013, partly because their US subsidiary was closed by the US for being a money laundering operation and because, in their haste to exit the US regulatory environment, they attempted to engage a US company to serve the US/Canadians markets. This went poorly, as their counterparty was transparently also going to get shut down for money laundering. Between the feds and the counterparty, Mt. Gox had several million dollars of customers' funds frozen. Some time after funds were seized, Mt. Gox started delaying outbound wire transfers. They variously blamed technical issues, issues with partner banks (including "The second largest bank in Japan can't process more than 10 wire transfers per day"), regulatory issues, etc etc. They didn't seem to have much problem with inbound transfers. They also didn't seem to have problems with domestic Japanese transfers until about December/January, which they blamed on the end-of-the-year holiday. Waits for withdraws stretched from weeks to months to unbounded. During this time, they routinely transferred out Bitcoins in minutes. As a consequence, people wanting to exit Mt. Gox would buy BTC on the exchange and withdraw it. This caused the price of BTC at Gox to exceed that of other exchanges in a sustained fashion, since at least August. Some weeks ago, Mt. Gox started delaying BTC withdraws as well. Their excuse for this was that their bookkeeping systems did not handle an edge case in the Bitcoin "protocol", where a) the One True Bitcoin Client searches for transactions by ID, b) the One True Bitcoin Client identifies a transaction by ID immediately upon creation, c) despite the above two facts, an emergent "feature" of the protocol is that that ID can change for up to about an hour after creation of the transaction. People freaked out, because Mt. Gox now allowed neither real money nor Internet money to leave their company. In the last 48 hours, it has been credibly alleged that Mt. Gox has suffered a theft to the tune of 700k BTC (worth somewhere north of $300 million) and that they are insolvent -- they owe debts to their customers far in excess of the Bitcoin and hard currency they have on hand. People are quite concerned. Mt. Gox's crisis communications have been wildly below the level of professionalism one would hope to see from a company with several hundred million dollars of financial assets. This is getting wide play in the media both internationally and in Japan, and it is possible that Mt. Gox has finally woken Leviathan, who may now take adverse notice to the fact that no-account foreigners are in his capitol making him look stupid and potentially ruining the livelihoods of some of his citizens. Mt. Gox customers currently are unaware when (if ever) and to what degree their claims against Mt. Gox will be satisfied. People interested in Bitcoin are worried that this will tarnish the system's reputation and/or lead to additional adversarial interest from government and other parties. [In evaluating whether I've been accurate with the above description, you might consider it useful to note that I'm a Japan-based entrepreneur with a fair bit of understanding about Bitcoin technically and systemically, and that I'm an open and notorious critic of it.]
runn1ng 13y ago
Mt.Gox has single-handedly the worst crisis communication I have ever seen.
- ye 13y ago
  Or the best from their perspective. It's a perfect steering wheel for the owners. They cause panic with another shitty announcement, internal price drops, they buy dirt-cheap coins, sell them on other exchanges, instant 200-600% profits.
- caruana 13y ago
  Well, them and Yahoo
MWil 13y ago
It's worth 0% assurance that you are still in Japan, Mark. Just sayin.
mfukar 13y ago
I'm in Japan and I'm having some delicious sushi while working very hard with the support of different parties to find a solution to my recent issues. Sincerely, mfukar.
snitko 13y ago
This statement at least seems like he stopped trying to bullshit people. He openly said that staff was instructed to not give out any info, which probably means they can't talk. I do not think this is the choice they or their lawyers made, but rather it is more likely to be an external factor, like a gag order or an acquisition deal. Having said that, chances of getting our money back are still extremely slim, but the update strikes me as containing less bullshit and as an attempt to reach out. My hope is that the truth will be revealed sooner than later and we can all move on. I'm saying it basically having lost all of my money with Gox. I think the time we've lost following this drama is probably more valuable.
- sentenza 13y ago
  You assume that there is any staff.
  - snitko 13y ago
    There are two people on the IRC channel answering questions. When the official #mtgox channel on freenode was muted (reason support gave: until we get answers from mtgox management) they kept talking to people on the unofficial channel ##mtgox-chat.
- kyro 13y ago
  The possibility of them being acquired is discussed quite a bit, but of what value is Gox to a potential acquirer at this point, considering they've indeed hemorrhaged money? What remaining assets or loyal customer base would make it worth millions of new capital?
  - snitko 13y ago
    If indeed they lost 770k BTC then, in my view, there can only be two reasons someone would buy them: 1. A buyer truly believes that Gox death would mean Bitcoin death or stagnation for 5-10 years and, thus, his own coins would be worthless anyway. 2. A buyer believes he can make more than 770k BTC he'd have to pay back customers. However, I don't really think they've lost that much. It is simply insane. I don't believe anyone can be that incompetent, especially after reading Mark's 2012 message about security here: https://bitcointalk.org/index.php?topic=23938.msg1177353#msg1177353 https://bitcointalk.org/index.php?topic=23938.msg1177353#msg... Update. Rumor on twitter about the acquisition: https://twitter.com/paulbuitink/status/438428157948219392 https://twitter.com/paulbuitink/status/438428157948219392
uptown 13y ago
"working very hard with the support of different parties to find a solution to our recent issues." And yet still no explanation from Mark as to what those issues specifically are.
madaxe_again 13y ago
Tum ti tum. "I haven't jumped the country... yet." - thanks for letting us know you're considering it.
markhahn 13y ago
If the loss is due to mutability (failing to canonicalize transaction components before hashing them as the ID), why hasn't the BTC world just tracked down all the bogus double-spends: which wallets they went into, etc. The whole blockchain construction permits tracing the complete graph - at least until it exits via a physical exchange (money, gold, beer, whatever).
caruana 13y ago
They still have staff?

56 points by ing33k 13y ago

alexchamberlain 13y ago

Dear Mark, Should you be reading this, please could you answer a very simple question... For each of the currencies you support - including BTC, USD etc: 1) How much do people have in their MtGox account? 2) How much do you have in the bank/wallet? Thanks, Alex

deleted 13y ago
[deleted]
lnanek2 13y ago
There's a nice chart in the PDF that was leaked, which was later confirmed by him on IRC. It had BTC/fiat currency assets vs. holdings vs. debts, etc.: http://www.scribd.com/doc/209050732/MtGox-Situation-Crisis-Strategy-Draft http://www.scribd.com/doc/209050732/MtGox-Situation-Crisis-S...

shawabawa3 13y ago

Well... At least this update includes some information (he's in Japan). Would be nice if he could mention anything about anything people actually care about (are they insolvent? Have they lost 700,000BTC? If not, how many? etc)

abc123xyz 13y ago

Its funny that people referred to bitcoin as a ponzy scheme Now we know that the protocol itself is actually quite good (despite mtgox trying to blame it) And the problem lies at the interface between bitcoin and the traditional payment systems (exchanges) Its a pitty that Satoshi never solved the problem of distributed TRUSTLESS exchange, tho I suppose that is a problem that didnt exist until bitcoin became popular.

Cthulhu_ 13y ago
> tho I suppose that is a problem that didnt exist until bitcoin became popular. Sure it did. Cash money. Exact same problems.
solve 13y ago
"Perfect is the enemy of good"

mxx 13y ago

What are the issues?

venomsnake 13y ago
Bad case of stealingeverithingus ... usual treatment is long prison term unless you are a wall street dear.
- NateDad 13y ago
  stealing / losing ... exactly which is a little unclear at this point. Honestly, probably a little (a lot?) of both.
patio11 13y ago
If you haven't been following along, the brief version: Mt. Gox is a Tokyo-based company which, most famously, took deposits in dollars, yen, and a few other currencies and also Bitcoin, and allowed people to trade Bitcoin for dollars/etc and vice versa. They charged traders a commission, and so earned a percentage of transaction volume. Transaction volume was massive -- Mt. Gox was the leading exchange for over a year. They had a rough year in 2013, partly because their US subsidiary was closed by the US for being a money laundering operation and because, in their haste to exit the US regulatory environment, they attempted to engage a US company to serve the US/Canadians markets. This went poorly, as their counterparty was transparently also going to get shut down for money laundering. Between the feds and the counterparty, Mt. Gox had several million dollars of customers' funds frozen. Some time after funds were seized, Mt. Gox started delaying outbound wire transfers. They variously blamed technical issues, issues with partner banks (including "The second largest bank in Japan can't process more than 10 wire transfers per day"), regulatory issues, etc etc. They didn't seem to have much problem with inbound transfers. They also didn't seem to have problems with domestic Japanese transfers until about December/January, which they blamed on the end-of-the-year holiday. Waits for withdraws stretched from weeks to months to unbounded. During this time, they routinely transferred out Bitcoins in minutes. As a consequence, people wanting to exit Mt. Gox would buy BTC on the exchange and withdraw it. This caused the price of BTC at Gox to exceed that of other exchanges in a sustained fashion, since at least August. Some weeks ago, Mt. Gox started delaying BTC withdraws as well. Their excuse for this was that their bookkeeping systems did not handle an edge case in the Bitcoin "protocol", where a) the One True Bitcoin Client searches for transactions by ID, b) the One True Bitcoin Client identifies a transaction by ID immediately upon creation, c) despite the above two facts, an emergent "feature" of the protocol is that that ID can change for up to about an hour after creation of the transaction. People freaked out, because Mt. Gox now allowed neither real money nor Internet money to leave their company. In the last 48 hours, it has been credibly alleged that Mt. Gox has suffered a theft to the tune of 700k BTC (worth somewhere north of $300 million) and that they are insolvent -- they owe debts to their customers far in excess of the Bitcoin and hard currency they have on hand. People are quite concerned. Mt. Gox's crisis communications have been wildly below the level of professionalism one would hope to see from a company with several hundred million dollars of financial assets. This is getting wide play in the media both internationally and in Japan, and it is possible that Mt. Gox has finally woken Leviathan, who may now take adverse notice to the fact that no-account foreigners are in his capitol making him look stupid and potentially ruining the livelihoods of some of his citizens. Mt. Gox customers currently are unaware when (if ever) and to what degree their claims against Mt. Gox will be satisfied. People interested in Bitcoin are worried that this will tarnish the system's reputation and/or lead to additional adversarial interest from government and other parties. [In evaluating whether I've been accurate with the above description, you might consider it useful to note that I'm a Japan-based entrepreneur with a fair bit of understanding about Bitcoin technically and systemically, and that I'm an open and notorious critic of it.]

runn1ng 13y ago

Mt.Gox has single-handedly the worst crisis communication I have ever seen.

ye 13y ago
Or the best from their perspective. It's a perfect steering wheel for the owners. They cause panic with another shitty announcement, internal price drops, they buy dirt-cheap coins, sell them on other exchanges, instant 200-600% profits.
caruana 13y ago
Well, them and Yahoo

MWil 13y ago

It's worth 0% assurance that you are still in Japan, Mark. Just sayin.

mfukar 13y ago

I'm in Japan and I'm having some delicious sushi while working very hard with the support of different parties to find a solution to my recent issues. Sincerely, mfukar.

snitko 13y ago

This statement at least seems like he stopped trying to bullshit people. He openly said that staff was instructed to not give out any info, which probably means they can't talk. I do not think this is the choice they or their lawyers made, but rather it is more likely to be an external factor, like a gag order or an acquisition deal. Having said that, chances of getting our money back are still extremely slim, but the update strikes me as containing less bullshit and as an attempt to reach out. My hope is that the truth will be revealed sooner than later and we can all move on. I'm saying it basically having lost all of my money with Gox. I think the time we've lost following this drama is probably more valuable.

sentenza 13y ago
You assume that there is any staff.
- snitko 13y ago
  There are two people on the IRC channel answering questions. When the official #mtgox channel on freenode was muted (reason support gave: until we get answers from mtgox management) they kept talking to people on the unofficial channel ##mtgox-chat.
kyro 13y ago
The possibility of them being acquired is discussed quite a bit, but of what value is Gox to a potential acquirer at this point, considering they've indeed hemorrhaged money? What remaining assets or loyal customer base would make it worth millions of new capital?
- snitko 13y ago
  If indeed they lost 770k BTC then, in my view, there can only be two reasons someone would buy them: 1. A buyer truly believes that Gox death would mean Bitcoin death or stagnation for 5-10 years and, thus, his own coins would be worthless anyway. 2. A buyer believes he can make more than 770k BTC he'd have to pay back customers. However, I don't really think they've lost that much. It is simply insane. I don't believe anyone can be that incompetent, especially after reading Mark's 2012 message about security here: https://bitcointalk.org/index.php?topic=23938.msg1177353#msg1177353 https://bitcointalk.org/index.php?topic=23938.msg1177353#msg... Update. Rumor on twitter about the acquisition: https://twitter.com/paulbuitink/status/438428157948219392 https://twitter.com/paulbuitink/status/438428157948219392

uptown 13y ago

"working very hard with the support of different parties to find a solution to our recent issues." And yet still no explanation from Mark as to what those issues specifically are.

madaxe_again 13y ago

Tum ti tum. "I haven't jumped the country... yet." - thanks for letting us know you're considering it.

markhahn 13y ago

If the loss is due to mutability (failing to canonicalize transaction components before hashing them as the ID), why hasn't the BTC world just tracked down all the bogus double-spends: which wallets they went into, etc. The whole blockchain construction permits tracing the complete graph - at least until it exits via a physical exchange (money, gold, beer, whatever).

caruana 13y ago

They still have staff?