6 ms·

There was no widespread use of malleability attacks before the closure of MtGox

81 points by roasbeef 13y ago

gargarplex 13y ago
I personally believe that Karpeles committed fraud and stole users' money, but I believe that category of risk was absolutely known and correctly priced into the instrument. What do you folks think? EDIT: A rational response is a much more satisfying outcome for you, if you can pull it off, rather than mere downvoting to attempt to force your hopes for reality onto the world.. yes, you do achieve a minor victory, a move forward against the hurt, downvoted opponent.. but not truly closer to victory, secure in a rational interpretation of events.
- TDL 13y ago
  I'm inclined to believe that it was incompetence & overconfidence that lead to the collapse. I suppose we will have a better understanding of what happened in the months to come.
  - gargarplex 13y ago
    Hanlon's razor, or "Any sufficiently advanced incompetence is indistinguishable from malice". http://en.wikipedia.org/wiki/Hanlon's_razor http://en.wikipedia.org/wiki/Hanlon's_razor
    - TDL 13y ago
      Incompetence can be criminal. I was speaking towards intent. It's doubtful there was intent to defraud. This doesn't mean that those involved shouldn't suffer the consequences of their actions. *Minor edit
- nknighthb 13y ago
  That would seem to mean either something went horribly and abruptly wrong with his scheme, or he forgot "and run". Which one are you postulating, and why?
  - gargarplex 13y ago
    I am postulating that he looks guilty here. http://graphics8.nytimes.com/images/2014/03/27/business/dbpix-bitcoin-mt-gox2/dbpix-bitcoin-mt-gox2-tmagArticle.jpg http://graphics8.nytimes.com/images/2014/03/27/business/dbpi... And I can't tell you why. Maybe I'm projecting. But it's my gut intuition. Though is this not a category of thought that should be discerned via "fast thinking"? Are there any studies that compare test subjects' judgments of guilt, based on defendant photographs, to jury verdicts?
    - nknighthb 13y ago
      Never serve on a jury.
      - gargarplex 13y ago
        Haha, oh man. Do you think the judge would let me cite this thread as evidence for why I should be excused? Also: you have a cognitive error, bud. I was a victim in this case; I would not be eligible for the jury. Fundamental attribution error http://en.wikipedia.org/wiki/Fundamental_attribution_error http://en.wikipedia.org/wiki/Fundamental_attribution_error
        nknighthb 13y ago
        Any jury, anywhere, for any case. People who think they can infer guilt from an utterly neutral facial expression captured in a still image are not fit to participate in any system of justice.
        gargarplex 13y ago
        OK, that comment was mean. Are you aware of that? edit: hahahaha, all right, whatever. he still looks guilty to me. sorry if he's innocent. regardless, there is definitely a sentiment, and i voiced it. i don't regret contributing. maybe my tone or something could have been improved? i'm not sure, because i don't disagree with my actions.
- yen223 13y ago
  Someone stole the money, but it's probably not Karpeles who did it.
  - gargarplex 13y ago
    Yakuza?
    - saalweachter 13y ago
      It doesn't have to be anything sexy. I've been at some places with pretty horrific internal security. It's easy to imagine that someone was trusted who shouldn't have been, and had access to nearly everything, including "cold" wallets. Heck, if they were working remotely they might not have even needed to "run".
      - yen223 13y ago
        Exactly. The reason I don't think it was Karpeles who did it is that his name is all over the place. He has (had?) a lot to lose if he decided to do something as brash as this.
- ubernostrum 13y ago
  Companies not involved with BitCoin lose large amounts of money and/or customer payment details (which is the same as losing their customers' money, in a sense) all the time, for reasons having nothing to do with malice on the part of the companies. Why do you hold BitCoin-based companies to be different?
singularityyy 13y ago
That seems like the most plausible scenario anyway. Karpeles was just trying to take down Bitcoin with him by blaming it on a 'Bitcoin bug'. All this is a joke just like everything else in this sad saga, such as "cold storage leaking". I wouldn't attribute to malice what could be explained by incompetence, but seriously, this cannot be explained by incompetence.
deleted 13y ago
[deleted]
- deleted 13y ago
  [deleted]
sillysaurus3 13y ago
What's there to say? This is yet another piece of evidence that Mt. Gox was grossly incompetent. Unfortunately, it's very difficult to prove whether or not there was any criminal fraud involved. If there was, and it could be proven, then at least justice could be served. If there wasn't any fraud, and that could be proven, then at least it could be shown that Karpeles was just a bad businessman, not a fraudster, and his name could be cleared. This limbo leaves so many questions unanswered that it's hard to know if we're ever going to find out what truly happened. Mt. Gox recently claimed they found 200,000 BTC that they'd lost track of. If their claim can be taken at face value, then I think it's plausible they may have panicked back when their losses first became clear to them in February, leading them to blame it on malleability even though they didn't really have a clue where their money went or why. They probably felt they had to tell people something, and saying "we lost track of >750,000 BTC for unknown reasons" may have been less desirable than blaming their problems on something tangible, like transaction malleability. Unfortunately for them, it turns out that they were wrong about that. So here we are. All that's been demonstrated is that consumers currently have very little protection in this space, and that patio11 and others were right to warn people to be very careful with bitcoin.
- rtpg 13y ago
  I'm not necessarily pro-bitcoin, but there's a difference between bitcoin:the protocol and bitcoin: services offered around this. I think this is more another case of pretty incompetent people going into this (probably linked to the fact that a lot of proponents of bitcoin are in it for the ponzi-scheme like qualities of the current environment). Maybe we'll get some people who've taken an accounting class and a concurrency class(necessary but not sufficient conditions) to implement these exchanges one day. The public ledger in particular could be used to establish a good amount of trust with an exchange (publicly-auditable). The only problem being that many bitcoin proponents buy into the myth that bitcoin allows you to remain anonymous, and that the exchanges should be built in the same way as money laundering services. We'll probably see a lot of this so long as the current environment is based around bitcoin being some sort of investment vehicle like gold. Maybe if enough people actually start wanting to use it as a currency, the quality of these services will go up, and we can trust them a bit more. Maybe actually having exchanges bail each other out (see Japanese banks in the 80s/90s) and supplying safety nets would increase trust.
bobjordan 13y ago
Take it with a grain of salt but at least there is a rumor that MtGox has found 670K more coins: http://theblogchain.com/news/mtgox-found-bitcoin/ http://theblogchain.com/news/mtgox-found-bitcoin/
reinhardt1053 13y ago
Karpelès was found guilty of a financial computer crime and of money transfer fraud when he was somewhere between 13 and 18 years old. The court gave him a 3 month suspended sentence and no criminal record.[0] [0] http://en.wikipedia.org/wiki/Mark_Karpel%C3%A8s http://en.wikipedia.org/wiki/Mark_Karpel%C3%A8s
- thefreeman 13y ago
  I hardly see this as relevant. For all we know he found a credit card on the internet and signed up for Brazzer's.
  - MichaelGG 13y ago
    From the source cited on Wikipedia[1]: "I will not give too much detail about what I did wrong, just say it concerns payment systems on the Internet. I spent two years taking risks becoming larger, perhaps because it was an exciting side … whatever, I ended up getting arrested" Without more details it doesn't mean much, but it does sound a bit more than using a stray card -- if that translated post is actually from him.
  - ceejayoz 13y ago
    A history of stealing someone else's money isn't relevant to a case where hundreds of millions of other peoples' money went missing?
negamax 13y ago
Blockchain is readable as this text. Just get a particular date range and check all transfers for that, filter by an amount!
wodzu 13y ago
MtGox certainly benefited from these attacks as it proved the problem is real. The real question is who was behind these attacks?

81 points by roasbeef 13y ago

I personally believe that Karpeles committed fraud and stole users' money, but I believe that category of risk was absolutely known and correctly priced into the instrument. What do you folks think? EDIT: A rational response is a much more satisfying outcome for you, if you can pull it off, rather than mere downvoting to attempt to force your hopes for reality onto the world.. yes, you do achieve a minor victory, a move forward against the hurt, downvoted opponent.. but not truly closer to victory, secure in a rational interpretation of events.

TDL 13y ago
I'm inclined to believe that it was incompetence & overconfidence that lead to the collapse. I suppose we will have a better understanding of what happened in the months to come.
- gargarplex 13y ago
  Hanlon's razor, or "Any sufficiently advanced incompetence is indistinguishable from malice". http://en.wikipedia.org/wiki/Hanlon's_razor http://en.wikipedia.org/wiki/Hanlon's_razor
  - TDL 13y ago
    Incompetence can be criminal. I was speaking towards intent. It's doubtful there was intent to defraud. This doesn't mean that those involved shouldn't suffer the consequences of their actions. *Minor edit
nknighthb 13y ago
That would seem to mean either something went horribly and abruptly wrong with his scheme, or he forgot "and run". Which one are you postulating, and why?
- gargarplex 13y ago
  I am postulating that he looks guilty here. http://graphics8.nytimes.com/images/2014/03/27/business/dbpix-bitcoin-mt-gox2/dbpix-bitcoin-mt-gox2-tmagArticle.jpg http://graphics8.nytimes.com/images/2014/03/27/business/dbpi... And I can't tell you why. Maybe I'm projecting. But it's my gut intuition. Though is this not a category of thought that should be discerned via "fast thinking"? Are there any studies that compare test subjects' judgments of guilt, based on defendant photographs, to jury verdicts?
  - nknighthb 13y ago
    Never serve on a jury.
    - gargarplex 13y ago
      Haha, oh man. Do you think the judge would let me cite this thread as evidence for why I should be excused? Also: you have a cognitive error, bud. I was a victim in this case; I would not be eligible for the jury. Fundamental attribution error http://en.wikipedia.org/wiki/Fundamental_attribution_error http://en.wikipedia.org/wiki/Fundamental_attribution_error
      - nknighthb 13y ago
        Any jury, anywhere, for any case. People who think they can infer guilt from an utterly neutral facial expression captured in a still image are not fit to participate in any system of justice.
        gargarplex 13y ago
        OK, that comment was mean. Are you aware of that? edit: hahahaha, all right, whatever. he still looks guilty to me. sorry if he's innocent. regardless, there is definitely a sentiment, and i voiced it. i don't regret contributing. maybe my tone or something could have been improved? i'm not sure, because i don't disagree with my actions.
yen223 13y ago
Someone stole the money, but it's probably not Karpeles who did it.
- gargarplex 13y ago
  Yakuza?
  - saalweachter 13y ago
    It doesn't have to be anything sexy. I've been at some places with pretty horrific internal security. It's easy to imagine that someone was trusted who shouldn't have been, and had access to nearly everything, including "cold" wallets. Heck, if they were working remotely they might not have even needed to "run".
    - yen223 13y ago
      Exactly. The reason I don't think it was Karpeles who did it is that his name is all over the place. He has (had?) a lot to lose if he decided to do something as brash as this.
ubernostrum 13y ago
Companies not involved with BitCoin lose large amounts of money and/or customer payment details (which is the same as losing their customers' money, in a sense) all the time, for reasons having nothing to do with malice on the part of the companies. Why do you hold BitCoin-based companies to be different?

singularityyy 13y ago

That seems like the most plausible scenario anyway. Karpeles was just trying to take down Bitcoin with him by blaming it on a 'Bitcoin bug'. All this is a joke just like everything else in this sad saga, such as "cold storage leaking". I wouldn't attribute to malice what could be explained by incompetence, but seriously, this cannot be explained by incompetence.

deleted 13y ago

[deleted]

deleted 13y ago
[deleted]

sillysaurus3 13y ago

What's there to say? This is yet another piece of evidence that Mt. Gox was grossly incompetent. Unfortunately, it's very difficult to prove whether or not there was any criminal fraud involved. If there was, and it could be proven, then at least justice could be served. If there wasn't any fraud, and that could be proven, then at least it could be shown that Karpeles was just a bad businessman, not a fraudster, and his name could be cleared. This limbo leaves so many questions unanswered that it's hard to know if we're ever going to find out what truly happened. Mt. Gox recently claimed they found 200,000 BTC that they'd lost track of. If their claim can be taken at face value, then I think it's plausible they may have panicked back when their losses first became clear to them in February, leading them to blame it on malleability even though they didn't really have a clue where their money went or why. They probably felt they had to tell people something, and saying "we lost track of >750,000 BTC for unknown reasons" may have been less desirable than blaming their problems on something tangible, like transaction malleability. Unfortunately for them, it turns out that they were wrong about that. So here we are. All that's been demonstrated is that consumers currently have very little protection in this space, and that patio11 and others were right to warn people to be very careful with bitcoin.

rtpg 13y ago
I'm not necessarily pro-bitcoin, but there's a difference between bitcoin:the protocol and bitcoin: services offered around this. I think this is more another case of pretty incompetent people going into this (probably linked to the fact that a lot of proponents of bitcoin are in it for the ponzi-scheme like qualities of the current environment). Maybe we'll get some people who've taken an accounting class and a concurrency class(necessary but not sufficient conditions) to implement these exchanges one day. The public ledger in particular could be used to establish a good amount of trust with an exchange (publicly-auditable). The only problem being that many bitcoin proponents buy into the myth that bitcoin allows you to remain anonymous, and that the exchanges should be built in the same way as money laundering services. We'll probably see a lot of this so long as the current environment is based around bitcoin being some sort of investment vehicle like gold. Maybe if enough people actually start wanting to use it as a currency, the quality of these services will go up, and we can trust them a bit more. Maybe actually having exchanges bail each other out (see Japanese banks in the 80s/90s) and supplying safety nets would increase trust.

bobjordan 13y ago

Take it with a grain of salt but at least there is a rumor that MtGox has found 670K more coins: http://theblogchain.com/news/mtgox-found-bitcoin/ http://theblogchain.com/news/mtgox-found-bitcoin/

reinhardt1053 13y ago

Karpelès was found guilty of a financial computer crime and of money transfer fraud when he was somewhere between 13 and 18 years old. The court gave him a 3 month suspended sentence and no criminal record.[0] [0] http://en.wikipedia.org/wiki/Mark_Karpel%C3%A8s http://en.wikipedia.org/wiki/Mark_Karpel%C3%A8s

thefreeman 13y ago
I hardly see this as relevant. For all we know he found a credit card on the internet and signed up for Brazzer's.
- MichaelGG 13y ago
  From the source cited on Wikipedia[1]: "I will not give too much detail about what I did wrong, just say it concerns payment systems on the Internet. I spent two years taking risks becoming larger, perhaps because it was an exciting side … whatever, I ended up getting arrested" Without more details it doesn't mean much, but it does sound a bit more than using a stray card -- if that translated post is actually from him.
- ceejayoz 13y ago
  A history of stealing someone else's money isn't relevant to a case where hundreds of millions of other peoples' money went missing?

negamax 13y ago

Blockchain is readable as this text. Just get a particular date range and check all transfers for that, filter by an amount!

wodzu 13y ago

MtGox certainly benefited from these attacks as it proved the problem is real. The real question is who was behind these attacks?