Bitcoin Exchange Mt. Gox Disappears

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It looks as though virtual currency has taken another hit with the disappearance of the bitcoin exchange Mt. Gox. And by disappearance, we mean "poof."

Mt. Gox, once the world's biggest bitcoin exchange, looked to have essentially disappeared on Tuesday, with its website down, its founder unaccounted for and a Tokyo office empty bar a handful of protesters saying they had lost money investing in the virtual currency.
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Oh man. A electronic only currency was doomed to be hacked. Much harder to hack paper dollars.

:-(
 
Who would have thought a Ponzi-scheme would end up this way?
 
Pretty much every piece of info about crypto currency states to never store any coins on a pool or exchange unless you're ready to loose them.

Also - the description on the front page and the actual article don't even come close to matching information.
 
Excuse me while I weep...no...not really
C'mon, banks get hacked. Government gets hacked. Anything and everything gets hacked if it has a connection to the interwebs. How is this any different?
 
ol1bit said:
Oh man. A electronic only currency was doomed to be hacked. Much harder to hack paper dollars.

:-(
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Actually they only hacked people's wallets or some exchanges. Not much difference than being mugged for your wallet or someone robbing a bank.

People have been counterfeiting paper money for decades, I’ve yet to see a counterfeit bitcoin.
 
I'm glad to see Mt Gox crash and burn, they were a cancer on the entire community.

I used to use them exclusively almost a year ago for trading and withdraws, it worked super smooth up until they started screwing things up. I took all my money out and went elsewhere (so glad I did)

I'm not heavily invested, but I have about $2k in crypto right now.

Those who don't know the history and details, Mt. Gox started out as a Magic the Gathering online trading card website. And they accidentally fell into the bitcoin world. The real world equivalent would be like "Toys-R-Us" turning into JP Morgan Chase overnight and then screwing the entire economy up.

In the sense of the word "hack" anything can be hacked, the fact it's electronic only makes it more accessible to being hacked.

That being said - I'm holding my various stash of BTC/LTC/WDC, everytime someone says "Bitcoin is dead" 6 months later it's worth 10X what it used to be.
 
An imaginary currency with no actual economic backing has issues?

Whodathunk?

And here I thought pyramids and Ponzis were the future.


the-one1 said:
Excuse me while I weep...no...not really
C'mon, banks get hacked. Government gets hacked. Anything and everything gets hacked if it has a connection to the interwebs. How is this any different?
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When your government or bank gets hacked it has real assets that back it's value. When your smoke and mirrors fantasy wallet gets hacked, it's gone. The whole pyramid is in danger of collapsing if the people at the top can't propagate their imaginary money for whatever reason.
 
Help a bitcoin noob out. Mt. Gox was used for trading/exchanging bitcoins for real money right? Why would one leave either the real money or bitcoins there for any length of time? Wouldn't you make your transaction (say sell some coins), then exit?
 
MrCaffeineX said:
LMAO

I thought the exact same thing when I saw the video on USA Today where the guy was protesting out front because his pretend money was gone...
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It's no different than the stock market. Plenty of people have had their investments up and vanish without a trace.. It sucks but it's a risk you take when you invest in something as volatile as bitcoins. It's not pretend money, it's money someone used to put a value on something.
 
Kongar said:
Help a bitcoin noob out. Mt. Gox was used for trading/exchanging bitcoins for real money right? Why would one leave either the real money or bitcoins there for any length of time? Wouldn't you make your transaction (say sell some coins), then exit?
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Not if you expect the value of the Bitcoin to rise, in which case, it makes sense to hold your assets until they are worth more.
 
But if I buy bitcoins on Mt. Gox, can't I remove them and store them on my PC? Or when you buy at those exchanges, do you have to leave the coins there forever (that seems like a terrible idea IMO).
 
Kongar said:
But if I buy bitcoins on Mt. Gox, can't I remove them and store them on my PC? Or when you buy at those exchanges, do you have to leave the coins there forever (that seems like a terrible idea IMO).
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It's no different then a bank man. If you give your money to a bank, you can only withdrawal it if they let you. Get it?
 
gamerk2 said:
Not if you expect the value of the Bitcoin to rise, in which case, it makes sense to hold your assets until they are worth more.
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Uh, no. It's not smart to hold your bitcoins at a private, uninsured exchange with a history of shady customer service.

You just hold them in your hold wallet. That's one benefit of bitcoin; it's easier to store/hide your own money.
 
NickJames said:
It's no different than the stock market. Plenty of people have had their investments up and vanish without a trace.. It sucks but it's a risk you take when you invest in something as volatile as bitcoins. It's not pretend money, it's money someone used to put a value on something.
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Wow, a lot of misinformation here. It's totally different then the stock market. This is like having your money stored in the he bank, then the bank saying "sorry, we lost your money, you're screwed."

But it was a really shady bank and the writing has been on the wall for many months.

But it's even worse then that. Gox just disappeared without a statement - likely the CEO, Mark Karpeles, is involved with keeping some for himself.
 
Think of Gox as a really shitty armored car service. Has no bearing on the currency stored in the car.

It's pretty sad that this has to be mentioned on a tech forum, guys.
 
okashira said:
Uh, no. It's not smart to hold your bitcoins at a private, uninsured exchange with a history of shady customer service.

You just hold them in your hold wallet. That's one benefit of bitcoin; it's easier to store/hide your own money.
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It's not to do so securely.

Most people recommend generating private keys using an offline computer and storing safe physical backups.

This is too much work for any sort of currency and why secure banking exists for fiat currency. Until there is a solution to this such as some sort of regulated exchange or deposit insurance, bitcoin will have an adoption problem with the public.

A state sponsored cryptocurrency (hopefully not deflationary) would realistically solve some of this - could potentially have the same security concerns but at least deposit insurance would be more realistic.

Right now, there is no way for any sane free market deposit insurance to exist and if there was it would just implode during events like this similar to AIG.

But then all of that would go against the libertarian propaganda machine that seems to go hand in hand with bitcoin and will likely be its downfall.
 
aardvark sandwich said:
Think of Gox as a really shitty armored car service. Has no bearing on the currency stored in the car.

It's pretty sad that this has to be mentioned on a tech forum, guys.
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Agreed. I am amazed about the amount of misunderstanding of bitcoin here.
 
InternationalHat said:
It's not to do so securely.

Most people recommend generating private keys using an offline computer and storing safe physical backups.

This is too much work for any sort of currency and why secure banking exists for fiat currency. Until there is a solution to this such as some sort of regulated exchange or deposit insurance, bitcoin will have an adoption problem with the public.

A state sponsored cryptocurrency (hopefully not deflationary) would realistically solve some of this - could potentially have the same security concerns but at least deposit insurance would be more realistic.

Right now, there is no way for any sane free market deposit insurance to exist and if there was it would just implode during events like this similar to AIG.

But then all of that would go against the libertarian propaganda machine that seems to go hand in hand with bitcoin and will likely be its downfall.
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You don't need to "generate" a private key. You can literally write one down by coming up with random numbers and letters. The PUBLIC key needs to be generated from the private key if you want to send money to it.

Again, what you suggest is really not difficult. Sure, having an offline computer to generate a public key is annoying for storing $5. But when you're storing $50,000 which is closer to a typlical household net worth, it's easier then driving to the bank.

It doesn't need to be a computer. You could use an old android phone or tablet. And you only generate it once. Generate a bunch of key pairs, store them offline, boom, done.
 
Twisted Kidney said:
An imaginary currency with no actual economic backing has issues?

Whodathunk?

And here I thought pyramids and Ponzis were the future.




When your government or bank gets hacked it has real assets that back it's value. When your smoke and mirrors fantasy wallet gets hacked, it's gone. The whole pyramid is in danger of collapsing if the people at the top can't propagate their imaginary money for whatever reason.
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Which bank/government actually has real assets to back their currency? The gold standard is long gone. Paper money is just that... paper. It only has a value because we all agree that is has a value. If the majority decided that it was not worth anything, it wouldn't be worth anything.
 
The board of Mt Gox are so squicked. You don't piss off miners/hackers from Russia/China.

So who wants to start a pool on when these guys are found dead?
 
From MTGOX.COM

Dear MtGox Customers,

In light of recent news reports and the potential repercussions on MtGox's operations and the market, a decision was taken to close all transactions for the time being in order to protect the site and our users. We will be closely monitoring the situation and will react accordingly.

Best regards,
MtGox Team
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cyclone3d said:
Which bank/government actually has real assets to back their currency? The gold standard is long gone. Paper money is just that... paper. It only has a value because we all agree that is has a value. If the majority decided that it was not worth anything, it wouldn't be worth anything.
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There's a reason swiss currency and banks are the most stable in the world. A very large percentage is backed by gold. (40%) while the swiss value tracks to 80% of gold value.
 
falkenbd said:
From MTGOX.COM
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WOW. Mark Karpeles is such a fucking clown. He should be served with a warrant and his office raided and him arrested. It happened in the US. But the Japanese legal system is less responsible.
 
DigitalGriffin said:
There's a reason swiss currency and banks are the most stable in the world. A very large percentage is backed by gold. (40%) while the swiss value tracks to 80% of gold value.
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It also helps that the Swiss economy is pretty damn small.

There's not enough gold the world over even for the USA to back it's currency with gold. Strictly speaking, many prescription drugs are more valuable per troy ounce than gold anyway.
 
okashira said:
You don't need to "generate" a private key. You can literally write one down by coming up with random numbers and letters. The PUBLIC key needs to be generated from the private key if you want to send money to it.

Again, what you suggest is really not difficult. Sure, having an offline computer to generate a public key is annoying for storing $5. But when you're storing $50,000 which is closer to a typlical household net worth, it's easier then driving to the bank.

It doesn't need to be a computer. You could use an old android phone or tablet. And you only generate it once. Generate a bunch of key pairs, store them offline, boom, done.
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You absolutely should be storing backups of this, and I wouldnt trust $50k to a couple hard drives or an old android phone. Sure you can write it down, but if you've lost it it's gone.

So maybe you put that in a deposit box, but then what's the point. Just use less complicated investments.

It's not for normal people yet.
 
Twisted Kidney said:
An imaginary currency with no actual economic backing has issues?

Whodathunk?

And here I thought pyramids and Ponzis were the future.




When your government or bank gets hacked it has real assets that back it's value. When your smoke and mirrors fantasy wallet gets hacked, it's gone. The whole pyramid is in danger of collapsing if the people at the top can't propagate their imaginary money for whatever reason.
Click to expand...

Are you sending this post from the 60's - because there are no hard assets backing the dollar. Sure it's seen globally as a relatively safe place to hold your assets, but if things go belly up, the "backing" you speak of is just a promise for them to print more paper money till the number side of your account is satisfied (if someone hacks or drains your account or whatever, they press some buttons and poof, you have money again).

There is no defacto standard behind the dollar anymore, gold, commodities, etc. It's exactly the same in bitcoin in that respect. It has value because a LOT of people think it does.
 
collegeboy69us said:
Are you sending this post from the 60's - because there are no hard assets backing the dollar. Sure it's seen globally as a relatively safe place to hold your assets, but if things go belly up, the "backing" you speak of is just a promise for them to print more paper money till the number side of your account is satisfied (if someone hacks or drains your account or whatever, they press some buttons and poof, you have money again).

There is no defacto standard behind the dollar anymore, gold, commodities, etc. It's exactly the same in bitcoin in that respect. It has value because a LOT of people think it does.
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Except with normal banking, any bank worth putting money in is insured nowadays...so your money isn't just "gone". Granted 100 years ago banking was alot like these exchanges.
 
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cyclone3d said:
Which bank/government actually has real assets to back their currency? The gold standard is long gone. Paper money is just that... paper. It only has a value because we all agree that is has a value. If the majority decided that it was not worth anything, it wouldn't be worth anything.
Click to expand...

Your bond value is dictated by your economic activity. Your GDP is real, it's quantifiable, and it's what your currency is (mostly) based on. Bonds earn money based on the risk attached to holding them, US bonds pay a shit rate because there is almost no risk attached to holding US bonds. Bonds issued by unstable economies like Italy have to pay much more because of the risk of default. Currency has a value based on how much of it there is, you can print more currency but all you end up with is more dollars/yen/yuan that are worth less money. There is no such control in Bitcoin, it has no economy, it's purely artificial.

Here's where it goes sideways. Bitcoin has zero asset backing, the risk of default or failure is somewhere near 100% and the potential for recovery is absolutely 0%. The currency is currently valued based entirely on any holder "getting out in time".
 
Skripka said:
Except with normal banking, any bank worth putting money in is insured nowadays...so your money isn't just "gone". Granted 100 years ago banking was alot like these exchanges.
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that's because there are no centralized banks for bitcoin

there are pros and cons to this, those focusing only on the negatives seem to be butthurt that they didn't make any money off cryptos like some of us other people did, so this is their "Ha! Gotcha!" moment
 
Skripka said:
Except with normal banking, any bank worth putting money in is insured nowadays...so your money isn't just "gone". Granted 100 years ago banking was alot like these exchanges.
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I know what you are trying to say, but you have to think past that level of "insurance" and what exactly a dollar is. Replace the word money in your sentence with the word value and you can see where I'm headed.

I can insure my car for 10,000 (roughly the current market value used) but if something happens to the value of the dollar itself, insurance has no obligation to give me an adjusted value vs what it says in the contract.

Your bank account is insured for 250K via FDIC. That's great, it does provide some assurance to people in the case of an individual bank going belly up or screwing off your money. What happens when the value of the money itself is in question. FDIC isn't going to give you $500,000 if the dollar suddenly loses 1/2 it's purchasing power.

The point in the fiat word is that it's all just numbers, and what we as humans assign it to be in terms of value. There is nothing backing it physically to anchor said numbers. Given a regular supply, gold/diamonds/food/ammo will generally hold a solid value in terms of usefulness to people, and via that you can tie the fiat system in and proceed accordingly.

The US financial system has some safety nets in place, and I fully admit that bitcoin has none. Neither are bulletproof or foolproof. Each one has strengths and weaknesses.
 
Reality said:
those focusing only on the negatives seem to be butthurt that they didn't make any money off cryptos like some of us other people did, so this is their "Ha! Gotcha!" moment
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This arguement reminds me of grade school, when the common retort was "you're just jealous".
 
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