Mt. Gox and other crypto markets need to switch to using a common, Open Sourced solution. Their use of proprietary software represents a threat to the entire Bitcoin ecosystem.
There's nothing wrong with them keeping a proprietary ledger of accounts, but attaching their crap code to the network is a crime of epic proportions. Hopefully Ethereum will help with this.
Your unregulated financial institutions fail to take basic security measures to protect consumers, they frequently halt withdrawals without warning, your uninsured deposits are sucked into the void, your speculative 'currency' experiences extreme daily deflation and inflation...
Better blame proprietary software. Whatever you do, don't question your assumptions. And under no circumstances should you think about the fact that fiat banks in the US all use proprietary software and rarely experience serious problems (and when they do, consumers' deposits are insured up to a large amount).
I heard of a cool tech called the dollar so I figured, what the heck, I'll give it a try.
Turns out they try to make you spend it by continually inflating the supply of them out there with no end. In order to keep your head above water, you have to put in a "bank".
Fine, it compensates you for the loss of purchasing power, so no biggie, right? Wrong. They actually lend out the dollars that are supposed to be in your account so when you come to get your dollars out, they might not even be there!
Now, they claim to have this handled, but it's kind of a hacky solution: supposedly what happens is that they'll go to a head honcho and get a temporary loan to be able to pay you, but they only give this privilege those that can get the political connections.
They also have have this system where you money is "insured" so that even if they can't get a loan "your dollars are safe, you'll still be able to get them out!" Kludgy, but it should work, right? Well, it turns out the insurance fund couldn't actually handle everyone pulling their money back out!
So, yeah, kind of hip, but I don't think it can catch on as a serious model, especially once auditors and whatnot get involved.
"those that can get the political connections" ... if you have the capital and do the paperwork and follow the regs, you can start a bank and get access to the discount window.
"insurance fund couldn't handle yada yada yada" ... the FDIC is implicitly backed by the full faith and credit of the US government. As long as the Treasury exists and has the ability to tax and borrow, your deposit is money good up to FDIC limits.
if you're going to invent new money, makes sense to understand the existing money, and try not to invent something worse.
Assuming I can go global, here's an example where you are wrong: http://inequality.org/great-cyprus-bank-robbery/. I'm pretty sure Goldman Sachs got their asses bailed out as well by the taxpayers.
You shouldn't play a shell game with the money and say then say there are "zero losses", but people do. It's called cognitive dissonance and it sucks.
And this, this statement is why I believe that Bitcoin or really any cryptocurrency will never have more than a fraction of a fraction of 1% of any transactions, and will never take off in the mainstream.
The reason that people use fiat currencies is because they can trust the institution/government backing them. They can trust that if they are handed a dollar by a business, it's a dollar, no questions asked.
If folks have to worry about whether or not the person they're exchanging with is being legit, and whether or not the institution handling the transaction will be as well, they're going to be turned off.
Like it or not, most people are lazy; adding one more layer of headache to financial transactions will be a MAJOR turn-off for a vast majority of people.
>The reason that people use fiat currencies is because they can trust the institution/government backing them.
Bitcoin is a fiat currency and I trust the Bitcoin specification a lot more than I'll trust any central bank. They're notorious for usury, secret bailouts, and inflation.
>They can trust that if they are handed a dollar by a business, it's a dollar, no questions asked.
Well you can trust that if you're sent a Bitcoin then it will end up in your wallet.
>the person they're exchanging with is being legit
This is the same thing that happened with online shopping at the end of the '90 and early '00s. Consumers got used to using their credit cards online and they will get used to the notion of owning, transferring, and protecting digital property.
>adding one more layer of headache to financial transactions
There is no such headache. The software will improve and the banking infrastructure will grow. I expect to see banks that hold their reserves in Bitcoin and give out lines of credit denominated in Bitcoin. Infrastructure will solve this problem, but first capital is needed to meet current regulatory compliance with the archaic legacy system that is currently in place.
There are rumors of an SEC-approved BTC exchange coming up. Once that happens, it will become possible to trade BTCs with the same level of confidence as trading Stocks, Currencies, or Commodities.
So at very least, SEC approved BTC funds are beginning to be set up. Its only a matter of time before a startup goes for full SEC approval in the BTC Exchange world.
Integration into US Society and Regulations is a good thing, and will give much confidence to the rather scary world that BTC currently is.
You might want to question your own assumptions as well. Couldn't the fact that Bitcoin is less mature in many ways than fiat currencies be a result of the fact that Bitcoin was invented just 5 years ago? There was no involuntary deposit insurance for USD when USD was 5 years old.
Thank you. It is very frustrating to have a conversation with someone expecting a new technology to be fully baked upon delivery. Everything takes time, although in Bitcoin's case, it seems like a rocket ride compared to other technology adoption curves.
So... anyone willing to learn enough about BitCoin to build something to find all the "fixed" transactions? It shouldn't take much analysis to determine whether or not MtGox has been drained.
All these articles written about what happened but no one able to just look at the blockchain and give hard numbers.
Do we actually have an exhaustive list of wallets controlled by Mt Gox though? That would seem like difficult to obtain and likely proprietary info they would not want to reveal.
my understanding is that the TxID is a sha256 of the entire transaction, hence it would be feasibly and even rather simple to scan the blockchain for invalid transaction IDs.. however we would have no idea which ones could be attributed to mtgox
A great example of the difference between investment and speculation. Pouring money into a company without a product helps fund development of that product.
I'm one of those dummies stucking with mtgox (BTC frozen, € still "on it's way" home). It eases the pain, to be part of it. This wild west will disappear, but there has to be beginning.
I believe in freedom and the banking system isn't. It isn't stabilizing our economy, it furthers a cleptocracy and destabilizes the system. Banksters even get premiums for that and when they fail, a bailout, just to take their premiums from there.
That makes such woes some sort of contribution towards a better economy.