Is this the largest heist in history?
Mt. Gox Files for Bankruptcy Protection
111–120 of 305 posts
Re: Mt. Gox Files for Bankruptcy Protection
#112It's easy to be angry at them and/or see how stupid they were about accounting, security, etc. But I guess on the other hand we do have to realize they are victims of massive theft, as far as we know this massive loss was not due to their own profiteering or internal theft, it was an organized outside force targeting them. It occurs to me it is like blaming someone for getting mugged, although they were stupid enough…
You are running an antique accessory business. You have a van to carry all the valuable stuff you borrow from people to sell in their name. Your van starts to leak oil. You figure out how to fix it yourself. Check engine light of the van is still blinking though, but you happened to put a post-it in your dashboard blocking it. By the way, you also never have it serviced. You keep driving for years while the situation…
Sounds like customers should have judged by themselves it wasnt a safe van to put your valuable antiques in.
Re: Mt. Gox Files for Bankruptcy Protection
#113Earlier quoted context omitted.
I believe your understanding if the situation is flawed, if you are a US citizen. The $3000 per year applies to capital losses. You did not suffer a capital loss. You suffered a loss due to bank insolvency. If you realized your gains in 2013, you actually owe taxes on $500,000 for your 2013 taxes, which is roughly $250k. I believe your losses due to bank insolvency will apply to your income for 2014. But you may be o…
Lets see if I understand this (I am not in the US) - the bitcoins count as an asset, you sell these bitcoins for dollars at MtGox and at this point the tax is due regardless of whether you actually get the dollars out of MtGox? So any time between you selling bitcoins and actually getting the cleared funds out of an exchange leaves you with the risk of a fairly serious tax liability if the exchange can't actually giv…
Bingo. Works the same way for shares. Unless you're investing in a tax-advantaged account, if you have a $10k basis in a stock/fund and liquidate it for $20k, you just realized a $10k gain regardless of what subsequently happens to that $20k. Park it at your brokerage, plow it into a new stock, withdraw it and buy a vat of chocolate to go skinny dipping in, the IRS doesn't care, but it will have its cut.
Poorly timed realizations of capital gains used to routinely bankrupt people in the startup community, which is why that 83(b) election paperwork is actually really important.
Re: Mt. Gox Files for Bankruptcy Protection
#114Hilarious. Can't wait to hear from the choir of libertarian crypto-currency-zealots, who will sing the praises of the Ponzi scheme that is Bitcoin. On a serious note: who benefits?
Yes, a failure of a single financial institution proves the currency is a completely failure. I mean, it's not like the USD and EUR markets had any institutions that failed or needed bailouts - well, except for Northern Rock, IndyMac, Lehman Brothers, Merrill Lynch, Fannie Mae, Freddie Mac, Washington Mutual, Wachovia, Citigroup, and AIG.
Those failures proved that USD and EUR have a system that works the way most civilized people want it to - individual investors were covered, losses were spread out, no individuals suffered catastrophe. Whereas most of the bitcoin "community" seems to take an ideological position of "everyone for himself".
Re: Mt. Gox Files for Bankruptcy Protection
#115I feel bad for Mark Karpeles but the way MtGox communicated & lied to its users makes me sad. It's those nameless individuals who believed in him, whose trust was betrayed - those are the ones that deserve the affection of the community. I've been following the news and I think MtGox was handling so much money that they should have focused on better security practices and audits.
Few examples of their lackadaisical attitude :
1. http://www.reddit.com/r/Bitcoin/comments/1x9gue/my_protest_a... :
I arrived at MtGox early, approximately 8am, and stood outside with a sign reading “MtGox, where has my money gone”. I got some curious looks, and a lot of questions from passersby about my protest. Then at approximately 9.20 am, Mark Karpeles himself came along carrying a large, and very fancy coffee in his hand that could have passed as a dessert. I immediately confronted him and told him we needed a chat. So he stopped to hear me out.
I told him he was playing with people’s lives, and some people stood to lose their entire savings. Like Gonzague told me the night before, he mentioned technical issues, and that he would look into my case.
2. http://www.reddit.com/r/Bitcoin/comments/1x9gue/my_protest_a...
I was told that up until a few weeks [at time of the interview] ago, there was hardly any development environment to test changes. Most changes were done straight on the production environment. Typing this made me throw up in my mouth.
Re: Mt. Gox Files for Bankruptcy Protection
#116Earlier quoted context omitted.
Did you invest $500,000 in real dollars, or earn it from mining?
Majority of it was from mining, but I had already realized my profits.
to be fair, with the funds in $ you probably have a better chance of getting some of that back than if it was BTC.
Re: Mt. Gox Files for Bankruptcy Protection
#117If only Bitcoin exchanges had some degree of regulation to ensure they were properly securing their users' funds, or perhaps some level of insurance to prevent their users from suffering financial losses due to the exchange's misfortune.
The idea of bitcoin was something that was impossible to regulate. This is what happens as a result, you take risks.
Re: Mt. Gox Files for Bankruptcy Protection
#118In this incident I lost a bit more than $500,000 USD that was in my MtGox account. I sold my Bitcoins a few months back, but the USD have been sitting in my account waiting to be withdrawn. This was a massive fuck up by MtGox, but I really do feel sorry for Mark Karpeles. He seemed really enthusiastic about Bitcoin. Right by MtGox's offices in Japan was a Bitcoin Cafe being built. You can [see here]( http://si.wsj.ne…
I have little sympathy for Mark. Assuming he didn't straight up stole the money, it all happened because of his incompetence.
How do you not notice a leak of 850,000 BTC?
How do you not have most of it in cold storage?
How do you not have all kinds of alert systems warning you about even a 500 BTC discrepancy, let alone hundreds of thousands?
Re: Mt. Gox Files for Bankruptcy Protection
#119Earlier quoted context omitted.
>> hindsight I'm only making this comment because you used the term "hindsight". Let me first start off by saying I feel very, very sorry for all the people who lost funds in MtGox. It'll take awhile before you get over the pain of losing a life-changing amount of money. But let's be very clear about this; hindsight wasn't needed here. The warning signs that MtGox was a house of cards became visible a long time ago.…
I will say that the article you linked is almost garbage. It glances over the "clues" very quickly which I will assume due to lack of knowledge. The complaint that passwords were displayed in plain text is not anywhere near recent. Even in 2011 when I started using MtGox, passwords were hashed. Granted, early on the passwords were only hashed with 1 pass of SHA256, but later on passwords were stored to much better st…
I've been advocating Bitcoin and trading with it since early 2011. Yes, MtGox was unstable. But so were other platforms.
I've tested withdrawal on MtGox every three years, to see and experience their current liquidity: Getting out Euro's was easy: getting out BTC has never been a problem. Probably them being my three-monthly-test, only a few hundred Euro or a fraction of a Coin at most, made it go through just fine.
Yes, there were apparent problems, and yes, these were highlighted everywhere. But in that case: with very little searching you'll read about people having problems bitstamp, kraken, btc-e, and whatnot.
This is a confusing market; one that requires you to keep a keen eye on the social-workings of some niche-forum, a reddit-community and a blogosphere around all that. In that sense, it might not be hindsight, no. But in that sense, /any/ problem was predicted. By someone. On some Forum. Or Blog. Or reddit-self.post.
Re: Mt. Gox Files for Bankruptcy Protection
#120Earlier quoted context omitted.
I am not clear with taxes, but I will go and consult with a CPA. Fortunately I did not keep everything in MtGox. If it turns out that I do owe $250k in taxes, I won't be in trouble. Thanks.
> If it turns out that I do owe $250k in taxes, I won't be in trouble. It sounds like you have little to complain about really. it sucks you lost half a million dollars, but if you're not upset about the possibility of losing a quarter more I imagine you're probably set for life as it is.
He initially posted a comment including
> [...] I really do feel sorry for Mark Karpeles.
So, it didn't seem that complaining was the main point.