To all the HN members who lost a lot of money in this closing, remember the community is here for you. Don't do anything too rash and if you need someone to talk to, myself and most other people would be happy to lend an ear.
Until Mt. Gox publicly confirms that no one will be getting their BTC and/or fiat money back, I think it's wrong to assume money owed to the users has been lost. Please have faith that they will do the right thing.
It's lost. Any money returned will be pennies on the dollar.
Sorry if this is a stupid question, but did Mt. Gox have their wallets? Why didn't these people keep their wallets with them?
The way that exchanges work is that they hold a wallet for you, you deposit money into it, and then you do off-blockchain trades with other users. At some point, you ask to withdraw, and give them your local wallet address, and then they send you the coins.
ok so Mt.Gox should still have the digital wallets. The whole point of bitcoin is that you don't need a central bank/exchange holding your wallet. But people used one anyways and now Mr.Gox doesn't know where the money went.
Fortunately there's ways of proving available deposits when using bitcoin. In theory at least, this can address the issue of counterparty risk. Hopefully all the exchanges will start adopting this.
Not really. If the exchange says "We have 500,000 BTC" and they publish their wallet, but their actual customer liabilities are 2M BTC, everyone can still lose a lot of money. What they really need is to be externally audited and undergo consistent regulation.
You can only lose what you give them, which should be no more than is necessary to complete a set of near-term transactions.
When you make a deposit you are extending credit. In the case of Mt. Gox, or any other Bitcoin exchange, that credit is secured by nothing and insured by noöne. Advice, going forward, for managing counterparty risk: (1) Split a $100 transaction into 10 $10* transactions executed incrementally (send $10 of BTC to Mt. Gox, exchange it, transfer it out, and only then send the next $10 of BTC over). This keeps exposure a…
I believe MtGox users have unfortunately learned the definition of "counterparty risk". This is one of the major overlooked risks that almost took down the global financial system in 2008. People would hedge their worthless bonds using AIG as a counterparty, and once things blew up, these people realized their insurance policies were completely worthless because AIG was about to go under itself, causing them to almos…
I've been wondering if the systemic portion of this risk mightn't be helped by allowing judges the power, during bankruptcy proceedings, to magic a small percentage of the balance owed into existence for the lender if the lender also forgives some (larger portion) of the balance provided that the loan is determined to have been a real loan made in good faith. This could help inject liquidity precisely when and where it's needed, while the requirement of someone undergoing bankruptcy, forgiveness of some of the debt, and judicial discretion would help check abuses.
What I wonder, is if Mark was actually the only one internally who had access to the cold storage wallets, what would happen if he got hit by a car and died? Have other exchanges got plans for this sort of thing? Some corps don't let their programmers fly on the same aeroplane. I wouldn't want to own that many Bitcoin and be the only one who has access also because someone could profit considerably from your death.
At Bitalo [0] we use multi signature wallets all over the place - for user wallets (so we cannot move them without users permissions), but also for company wallet for storing fees. For the latter, all board members have keys for them, but you only need a subset of them to access the funds. That way even if one of them loses the key or something bad happens to them, coins can still be moved by the others. For example,…
Please, don't ever send money nor coins to these guys, they're scammers. M4v3R used to run http://bitmarket.eu and lost all the users' coins while running some sort of (according to his own words) "hedge fund" around December 2012. Around April 2013, with bitcoin around $50 he "kindly" offered to reimburse everyone over time, valuating each coin at 10€ arguing that it was their value when he lost them. I told them wanted my 10btc, not money, and they still owe me to this day.
When you make a deposit you are extending credit. In the case of Mt. Gox, or any other Bitcoin exchange, that credit is secured by nothing and insured by noöne. Advice, going forward, for managing counterparty risk: (1) Split a $100 transaction into 10 $10* transactions executed incrementally (send $10 of BTC to Mt. Gox, exchange it, transfer it out, and only then send the next $10 of BTC over). This keeps exposure a…
Mt. Gox and many other exchanges have put into people's minds that you HAVE to forfeit your rights to your Bitcoin when using online services. It doesn't have to be that way, though. You could just use a system like we use at Bitalo [1], where fractional reserves or funds misuse are impossible because of use of multi-signature Bitcoin addresses, which means funds are specifically tied to user wallets and exchange ope…
Please, don't ever send money nor coins to these guys, they're scammers. M4v3R used to run http://bitmarket.eu and lost all the users' coins while running some sort of (according to his own words) "hedge fund" around December 2012. Around April 2013, with bitcoin around $50 he "kindly" offered to reimburse everyone over time, valuating each coin at 10€ arguing that it was their value when he lost them. I told them wanted my 10btc, not money, and they still owe me to this day.
There was never a MTG trading card site on that domain. This is a myth you should stop spreading.
Well if that's so untrue then you should take your mythbusting campaign to the Mt Gox page on WikiPedia where it clearly states this was the original intent of their business. Mt Gox stands for "Magic The Gathering Online eXchange", does it not?
It was almost certainly the intent on purchasing the domain, but that doesn't establish that one was actually running. My understanding of what evidence is available leads me to think it never was (particularly a lack of anyone posting anything about the domain in conjunction with Magic anywhere except comments like the above).
Highhorses are fun to ride, but if you put in 5% of your networth at any point > 8 months ago, it is likely that you ended up with 90-95% of your net worth in Bitcoin.
I had not considered this, and you have a very good point. Most of those people had been getting used to the idea of being rich, that it will be very rough for them to adjust. Besides, the way their money is lost made it so much worse. The global value of btc crashing would be one thing, corruption would be another, but this level of incompetence.. it's almost harder to digest since they most likely are not guilty of…
Too true. It is interesting that rationally speaking, considering windfalls or lottery winnings "house money" is incorrect--money is money. This attitude can lead you to cognitive errors that cost you more money in the long run.
On the other hand, if we think about the coping strategy for people who've been Goxed, I can see where if you can disregard the winnings as "paper gains" it is much easier to get on with life thinking "I only lost 10k."
Did you try to get your money out of MtGox? A friend of mine has been trying to get his money (CAD) out of MtGox for 2 months. He received his money yesterday.
Where is he? I've read about a few people getting their money, but they were all in Japan moving $ into Japanese bank accounts. I tried to withdraw a couple hundred at the start of January into a US bank account and I'm curious if I'll ever get it. It's a very small amount of money (and I paid even less to get the BTC originally), so it's not a big deal at all if I lose it all but I'd still like to get it.
I believe MtGox users have unfortunately learned the definition of "counterparty risk". This is one of the major overlooked risks that almost took down the global financial system in 2008. People would hedge their worthless bonds using AIG as a counterparty, and once things blew up, these people realized their insurance policies were completely worthless because AIG was about to go under itself, causing them to almos…
The collapses we've seen with traditional currencies stem from the inherent risks of fractional-reserve lending. Is this a risk with Bitcoin? According to my limited understanding, it doesn't seem to be. That should in theory reduce the need for things like FDIC and complicated risk calculations, like counter-party risk. MtGox doesn't seem like a "bank failure" or "bank run" to me. It seems like a bank that forgot to…
At least if your money is held in an FDIC insured bank and the bank goes under, you can rely on the government to insure your investment. With bitcoin you have no such thing.