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Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

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Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#21

Post by loceng »

bushido wrote: post #6

With the possibility of getting down voted into oblivion. The BTC lost/stolen are all available within blockchain/public ledger. Depending on who stole them, it would probably be distributed within multiple very smaller transaction. It my be traceable, but likely unrecoverable, because this is a feature of Bitcoin. In other words authorities and forensic enthusiasts can find the BTC but they are most likely lost at t…

This is the issue. It can become a never-ending wild-goose chase. The thieves can continue to move the funds around until they're no longer tracked, or far enough ahead that from the trackers (assuming there's any enforcement or penalties or laws relating to accepting stolen Bitcoin - which there aren't currently) or just spend them if they're not being tracked or if there's no enforcement in place.

The thieves will move funds around at little cost in order to try to gain the value from the Bitcoin they stole.

The problem with Bitcoin is that because there's no fee associated with them, there's no money or resources being made available or directed towards policing and following of these thieves.

Edit: And it's not particularly fair to use the rest of society's resources to do this policing, when they're not contributing to the system - they're avoiding contributing, to a partially corrupt and currently inefficient system, yes - but it'd be better to fix these inefficiencies and deal with the corruption.

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#22

Post by yread »

Why doesn't Mt. Gox just publish the ID of the wallet(s) from which they were stolen?

1. They weren't stolen - lost in cold storage harddisk failure for example

2. Revealing it would show something extremely embarrassing - they only used a single wallet?

3. They still have them - yay?

4. They were stolen by Mt. Gox - gulp

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#24

Post by stcredzero »

[deleted] wrote: post #10
bushido wrote: post #6

With the possibility of getting down voted into oblivion. The BTC lost/stolen are all available within blockchain/public ledger. Depending on who stole them, it would probably be distributed within multiple very smaller transaction. It my be traceable, but likely unrecoverable, because this is a feature of Bitcoin. In other words authorities and forensic enthusiasts can find the BTC but they are most likely lost at t…

[deleted]

Really paranoid thieves could choose to lose a large number of the keys, making the chances good that investigations will run into dead ends. But al most no one is that paranoid. They'll just keep moving the bitcoins around.

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#26

Post by tommo123 »

jnbiche wrote: post #9
fredgrott wrote: post #7

Here s an idea.. Feds sized silk road and the Bitcoin wallets If any was stored or transacted at MTGox this might be some of the amount of losses MTGOX is now showing but NOT ALL OF The lOSSeS obviously

Bingo. The Feds seized their cold wallet somehow. Mark has said repeatedly that Mt. Gox is under investigation and that he can't talk about it. There's a supposed IRC log from two days ago where he let it slip that he's under a gag order, saying two days ago "le gouv US ne veut pas qu'on disclose" (the US gov. doesn't want us to say anything)[0]. And he's said in public that he can't discuss the matter since he's und…

I like that. "Prove you're not a drug dealer and we'll see if there's still money to return." It kind of gives the middle fingers to 3 somewhat-important US rights: the right to not self-incriminate (being coerced into providing new evidence that might be used against you), being considered innocent until proven guilty (assets seized without an active case against you), and that everyone is equal under the law (unless we say you're a drug dealer (or, going back 60 years, black)).

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#27

Post by tibbon »

bushido wrote: post #6

With the possibility of getting down voted into oblivion. The BTC lost/stolen are all available within blockchain/public ledger. Depending on who stole them, it would probably be distributed within multiple very smaller transaction. It my be traceable, but likely unrecoverable, because this is a feature of Bitcoin. In other words authorities and forensic enthusiasts can find the BTC but they are most likely lost at t…

From what I understand, tracing them is also hard because (generally) there isn't any annotation on the blockchain to indicate who actually had them or what they were used for. So its hard to tell what point is just another place they laundered them, or someone who just got them in a transactions and then reused them elsewhere.

Let's assume eventually they will be 'spent' somewhere- its going to be damn near impossible to track them down unless they transfer all of them into a single wallet with their name/address in the comment.

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#28

Post by deweller »

In November of 2011 Mt. Gox demonstrated control of 500k BTC.

I followed the 500,000 BTC for a bit beginning at https://blockchain.info/tx/b269bf1b82dae8a61f7f91dbf7a9d807e....

The coins move around and small amounts are sent away, but the majority ends up back in Mt. Gox's main (hot) wallet. This repeats a few times until the majority is paid back to the main Mt.Gox address.

Here is the transaction where it starts to get interesting:

https://blockchain.info/tx/478ea915aa3a2e54503c43e1c5659722b...

What's left of the 500,000 (429.9k) is split into roughly half and sent to 2 new address. And then each of those address splits the coins in half and sends to two new address.

The end result is that the 429k was split again and again until the funds are split into many addresses, each of which now contain less than 1,000 BTC each. I stopped following the transactions there.

Why take 429k and split it into many addresses each containing less than 1,000 BTC each?

I'd like to see someone trace all of these coins and see if they end up coming together somewhere or show a pattern.

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#29

Post by samelawrence »

jnbiche wrote: post #9
fredgrott wrote: post #7

Here s an idea.. Feds sized silk road and the Bitcoin wallets If any was stored or transacted at MTGox this might be some of the amount of losses MTGOX is now showing but NOT ALL OF The lOSSeS obviously

Bingo. The Feds seized their cold wallet somehow. Mark has said repeatedly that Mt. Gox is under investigation and that he can't talk about it. There's a supposed IRC log from two days ago where he let it slip that he's under a gag order, saying two days ago "le gouv US ne veut pas qu'on disclose" (the US gov. doesn't want us to say anything)[0]. And he's said in public that he can't discuss the matter since he's und…

"get their money back"

Lulz.

Re: Ask HN: Where are the 750k Bitcoins lost by Mt. Gox?

#30

Post by neals »

deweller wrote: post #28

In November of 2011 Mt. Gox demonstrated control of 500k BTC. I followed the 500,000 BTC for a bit beginning at https://blockchain.info/tx/b269bf1b82dae8a61f7f91dbf7a9d807e... . The coins move around and small amounts are sent away, but the majority ends up back in Mt. Gox's main (hot) wallet. This repeats a few times until the majority is paid back to the main Mt.Gox address. Here is the transaction where it starts…

Can anybody follow one of these "branches" until the very last known transaction on the blockchain? Would that clear anything up?
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