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Fraudulent trading activity at Mt. Gox

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Re: Fraudulent trading activity at Mt. Gox

#121

Post by zymhan »

jackgavigan wrote: post #69
nwh wrote: post #61

Earlier quoted context omitted.

Segregated wallets doesn't work, that would mean every single trade would be a transaction on the block chain. It would absolutely flood the network and result in massive fees. It literally can't be done that way.

And that inherent inefficiency is just one of the reasons Bitcoin is not the future of finance.

So you went from " if the team behind an exchange isn't capable of dealing with the complexity of individual, segregated wallets, you have to wonder whether they're competent enough to run an exchange in the first place" to "that inherent inefficiency"? Which is it, an inherent flaw in BTC, or ineptitude on the part of the exchangers?

Re: Fraudulent trading activity at Mt. Gox

#122

Post by pdkl95 »

lsc wrote: post #112
pdkl95 wrote: post #93

Earlier quoted context omitted.

This is what we call "projection". You may lie sometimes, and so you assume other people do as well. Some of us don't. Personally, I don't have the room in my head for it; there far more important thing to try and remember, and trying to keep track of lies would eat up way to much wetware. I make no claims as to frequency of non-lying - it be a rare trait. I have met a couple others, though, so "everybody" is incorre…

>Some of us don't. Personally, I don't have the room in my head for it; there far more important thing to try and remember, and trying to keep track of lies would eat up way to much wetware. You must have a, ah, very narrow conception of what a lie is. I mean, sure, most of us don't build a complex and self-consistent web of deception where we maintain several different self-consistent models of reality at once. But…

> You must have a, ah, very narrow conception of what a lie is.

I'm quite aware of all the various types of lies people tell.

> The most common substantive lie, I think, is the "tell them what they want to hear" lie.

No, I don't tell that kind of lie either.

> "how are you?" Quite often, I will say "fine" even if it is a lie.

These really annoy me, because it's a waste of time. It conveys no information. Worse, it can encourage burring problems under a facade of being "fine".

Again, I understand that most people habitually tell "little white lies". That doesn't mean everybody does.

Re: Fraudulent trading activity at Mt. Gox

#123

Post by throwaway7767 »

jackgavigan wrote: post #60

The ironic thing about this is that the nature of Bitcoin (specifically, the fact that all transactions are recorded in the blockchain) means that auditing a Bitcoin exchange is an eminently solvable problem. To my mind, given the ease with which Bitcoin wallets can be created, any exchange that commingles its clients' Bitcoins should be viewed with suspicion. Yes, it's easier to dump everything into a few wallets, i…

As others have noted, there are scaling issues with moving every single transaction out into the blockchain.

Luckily, this is not needed. An exchange can prove that it holds all the bitcoin it claims to, and each induvidual account holder can verify the proof as it pertains to their own coins. See this for example: https://iwilcox.me.uk/2014/proving-bitcoin-reserves

Hopefully users will start to insist on these kinds of things in the future.

Re: Fraudulent trading activity at Mt. Gox

#124

Post by oznathan »

sillysaurus3 wrote: post #96
oznathan wrote: post #95

I don't think the bot is responsible for either bubble. But, if it was, the bitcoin world owes everything to Mark Karpeles. Because of the price surges it got all the media attention, VC investments, hundreds of companies popping up, millions of users...

... and hundreds of thousands of people losing everything they had in Mt. Gox (at best) and straight into Karpeles' pocket (at worst). Are you sure we owe him?

I lost some money there too, I've been their customer since 2011.

But if the main reason for the April and November bubbles is Willy, than the current (amazing) state of bitcoin is thanks to him.

Re: Fraudulent trading activity at Mt. Gox

#125

Post by oznathan »

throwaway7767 wrote: post #113
oznathan wrote: post #95

I don't think the bot is responsible for either bubble. But, if it was, the bitcoin world owes everything to Mark Karpeles. Because of the price surges it got all the media attention, VC investments, hundreds of companies popping up, millions of users...

These kinds of market manipulation shenanigans only reduces trust in bitcoin, so no, we don't owe that fuckwad anything. I did gain (ever so slightly) from the higher price, and I didn't have any money with MtGox so no loss there. But I'm still unhappy about it, because I want to see bitcoin succeed in the long term.

Unfortunately every market is highly manipulated... And in any market you deal with people who have more information than you. The game is trying to understand the manipulation.

Re: Fraudulent trading activity at Mt. Gox

#126

Post by ubercow13 »

pdkl95 wrote: post #122
lsc wrote: post #112

Earlier quoted context omitted.

>Some of us don't. Personally, I don't have the room in my head for it; there far more important thing to try and remember, and trying to keep track of lies would eat up way to much wetware. You must have a, ah, very narrow conception of what a lie is. I mean, sure, most of us don't build a complex and self-consistent web of deception where we maintain several different self-consistent models of reality at once. But…

> You must have a, ah, very narrow conception of what a lie is. I'm quite aware of all the various types of lies people tell. > The most common substantive lie, I think, is the "tell them what they want to hear" lie. No, I don't tell that kind of lie either. > "how are you?" Quite often, I will say "fine" even if it is a lie. These really annoy me, because it's a waste of time. It conveys no information. Worse, it ca…

You're missing out. Lying is an incredibly useful social tool that society would maybe fall apart without.

Re: Fraudulent trading activity at Mt. Gox

#127

Post by jackgavigan »

zymhan wrote: post #121
jackgavigan wrote: post #69

Earlier quoted context omitted.

And that inherent inefficiency is just one of the reasons Bitcoin is not the future of finance.

So you went from " if the team behind an exchange isn't capable of dealing with the complexity of individual, segregated wallets, you have to wonder whether they're competent enough to run an exchange in the first place" to "that inherent inefficiency"? Which is it, an inherent flaw in BTC, or ineptitude on the part of the exchangers?

Both.

Re: Fraudulent trading activity at Mt. Gox

#128

Post by stevewilhelm »

lrm242 wrote: post #117
bodski wrote: post #114

Earlier quoted context omitted.

Don't forget, 'real' bank accounts work like this as well. The money is no longer yours once you deposit into an account. The bank represents it as a liability on its balance sheet. As an account holder you are an 'unsecured creditor' of the bank. I have a feeling a lot more of us will be aware of this arrangement within a year or two, once the bail-ins begin.

US banks have FDIC insurance to protect deposits up to $250,000 [1]. To the extent that you trust the US government you can trust that your money is safe in a US bank up to the stated FDIC limits. Banks fail all the time. There have been 8 failures in 2014 so far and not a single penny of depositor money has been lost. You can see a list of every bank failure and the outcome here [2]. The simple and incontrovertible…

Be careful regarding FDIC insurance. Most investment instruments: stock, bond, mutual funds are not covered by FDIC protections. [1]

[1] http://www.fdic.gov/consumers/consumer/information/fdiciorn....

Re: Fraudulent trading activity at Mt. Gox

#129

Post by argumentum »

pdkl95 wrote: post #122
lsc wrote: post #112

Earlier quoted context omitted.

>Some of us don't. Personally, I don't have the room in my head for it; there far more important thing to try and remember, and trying to keep track of lies would eat up way to much wetware. You must have a, ah, very narrow conception of what a lie is. I mean, sure, most of us don't build a complex and self-consistent web of deception where we maintain several different self-consistent models of reality at once. But…

> You must have a, ah, very narrow conception of what a lie is. I'm quite aware of all the various types of lies people tell. > The most common substantive lie, I think, is the "tell them what they want to hear" lie. No, I don't tell that kind of lie either. > "how are you?" Quite often, I will say "fine" even if it is a lie. These really annoy me, because it's a waste of time. It conveys no information. Worse, it ca…

So you're a pathological truth-teller?

Re: Fraudulent trading activity at Mt. Gox

#130

Post by bodski »

Nursie wrote: post #118
bodski wrote: post #114

Earlier quoted context omitted.

Don't forget, 'real' bank accounts work like this as well. The money is no longer yours once you deposit into an account. The bank represents it as a liability on its balance sheet. As an account holder you are an 'unsecured creditor' of the bank. I have a feeling a lot more of us will be aware of this arrangement within a year or two, once the bail-ins begin.

False. In many countries currency deposits (up to a certain level) are protected by law and government guarantees.

I didn't say you won't get your money but that legally speaking the money, once deposited, is not yours any more, it is an asset of the Bank. This is why you'd need insurance/government-guarantees during a bank failure, otherwise you'd be treated just like a stock or bond holder who holds no collateral.

"From a legal and financial accounting standpoint, the term "deposit" is used by the banking industry in financial statements to describe the liability owed by the bank to its depositor, and not the funds that the bank holds as a result of the deposit, which are shown as assets of the bank." - http://en.wikipedia.org/wiki/Deposit_account

"Bank deposits are simply a record of how much the bank itself owes its customers. So they are a liability of the bank, not an asset that could be lent out." - p.http://www.bankofengland.co.uk/publications/Documents/quarte...

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