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Mt. Gox Allegedly Loses $350m in Bitcoin (744,400 BTC), Rumoured to be Insolvent
Coin Desk ^ | 25 Feb 2014 | Pete Rizzo

Posted on 02/25/2014 3:12:30 AM PST by Errant

A document has surfaced suggesting that troubled Japan-based bitcoin exchange Mt. Gox will close for one month as part of a four-step rebranding plan, and that CEO and former Bitcoin Foundation board member Mark Karpeles will step down from his executive position as part of the process.

The bitcoin price has been tumbling all morning amid the news, hitting a low of $419 so far this morning.

Entitled “Crisis Strategy Draft,” the document suggest the company’s increasingly dire financials are greatly impacting the decision. By Mt. Gox’s own estimates, they say, it has only 2,000 BTC and approximately $22.4m in fiat currencies in its possession.

The document was first reported by Ryan Galt, aka the Two-Bit Idiot, who later confirmed to CoinDesk:

(Excerpt) Read more at coindesk.com ...


TOPICS: Business/Economy; Computers/Internet; Society
KEYWORDS: bitcoin; crypto; gox

1 posted on 02/25/2014 3:12:30 AM PST by Errant
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To: Lurkina.n.Learnin; nascarnation; TsonicTsunami08; SgtHooper; Ghost of SVR4; Lee N. Field; DTA; ...

Click to be Added / Removed.
2 posted on 02/25/2014 3:13:16 AM PST by Errant (Surround yourself with intelligent and industrious people who help and support each other.)
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To: Errant
Other News:

Mt. Gox Trading Halts As Bitcoin Businesses Move to Assure Investors

Bitcoin Prices Down As Mt. Gox Concerns Escalate

Survival of Bitcoin exchange Mt.Gox in doubt

Apparent Theft at Mt. Gox Shakes Bitcoin World

3 posted on 02/25/2014 3:18:41 AM PST by Errant (Surround yourself with intelligent and industrious people who help and support each other.)
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To: All

Current price of Btc is above $500 at the other exchanges.


4 posted on 02/25/2014 3:20:31 AM PST by Errant (Surround yourself with intelligent and industrious people who help and support each other.)
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To: Errant

Any of these psuedo-currencies are going to be insolvent.


5 posted on 02/25/2014 3:49:24 AM PST by arderkrag (An Unreconstructed Georgian, STANDING WITH RAND.)
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To: Errant

Still not time to buy in.

I am still holding out for $0.125, which is actually “par”.

You know, “two bits” is $0.25, or it was when I was a kid.

And a quarter meant something.


6 posted on 02/25/2014 3:53:27 AM PST by alloysteel (Obamacare - Death and Taxes now available online. One-stop shopping at its best!)
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To: arderkrag

When the guy announced that some hacker had stolen all of the bitcoins from his website, I thought “Hey - this guy will fit right in with the ‘lost my guns in a boat accident’ threads!”


7 posted on 02/25/2014 3:56:47 AM PST by 21twelve (http://www.freerepublic.com/focus/f-news/2185147/posts 2013 is 1933 REBORN)
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To: Errant

“Mt. Gox will close for one month as part of a four-step rebranding plan”

LOL. $350 million and they are going to “Rebrand”. That will make people trust them.


8 posted on 02/25/2014 4:07:49 AM PST by Lurkina.n.Learnin (This is not just stupid, we're talking Democrat stupid here.)
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To: arderkrag

This is near ponsi hysteria and the same in the long run. Buy Kruegerands, they will always have value.


9 posted on 02/25/2014 4:35:48 AM PST by Vaquero (Don't pick a fight with an old guy. If he is too old to fight, he'll just kill you.)
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To: Errant

Dam! didn’t see this coming. [sarc]


10 posted on 02/25/2014 4:45:49 AM PST by traderrob6
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To: Lurkina.n.Learnin
$350 million and they are going to “Rebrand”

If I had engaged in a $350 million transfer of wealth, I don't think I'd go back to the well for a second try.

11 posted on 02/25/2014 4:59:05 AM PST by PAR35
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To: Errant

Hah! All the Bitcoin haters come out of the woodwork as usual.

This is exactly as significant for Bitcoin as a bank robbery is for the dollar. Bitcoins are just as “real” as US dollars (both mostly exist as bits in a computer memory). The main differences are Bitcoins can’t be manipulated like dollars, they’re much less inflationary, and they’re independent of any particular government. They can also be sent anywhere at low cost. Those are good things.

Precious metals have their place too, the strengths of the two complement each other.


12 posted on 02/25/2014 5:02:05 AM PST by PreciousLiberty
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To: Errant

“Bitcoins” are a clever Ponzi scheme. Get in at your own risk. As soon as the government figures out if they are money, a money transfer system, an investment package, or a Ponzi scheme you will see massive regulations from Washington.


13 posted on 02/25/2014 5:32:23 AM PST by I want the USA back (Media: completely irresponsible traitors. Complicit in the destruction of our country.)
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To: PreciousLiberty
But who is going to enforce the "theft" of a virtual currency, not backed or regulated by any government? Is it a felony or a misdemeanor?

One of the major problems with Bitcoin is its value is simply the perception of its value. If "people" think each Bitcoin is worth millions, then BTC are worth millions. If "people" think each Bitcoin is worth $0.25, then it's worth a quarter.

You talk about inflation and government manipulation? The prices on the exchanges have ranged from $135 to $1200 per BTC within the past six months, and I'm supposed to feel secure about that?

14 posted on 02/25/2014 5:49:07 AM PST by cincinnati65
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To: Vaquero

“Buy Kruegerands, they will always have value.”

I think I’ll stick with my beanie babies.

Things go bad I can always cook em up and serve them with a side of cabbage patch kids.


15 posted on 02/25/2014 5:50:59 AM PST by IMR 4350
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To: PAR35

... then you obviously don’t have what it takes to be a central banker nor a CEO of one of the TBTF banks.


16 posted on 02/25/2014 5:51:27 AM PST by coloradan (The US has become a banana republic, except without the bananas - or the republic.)
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To: Lurkina.n.Learnin

It worked for Ally Bank!

Currencies without rule of law and ability to enforce such law with police and armies are doomed to fail.


17 posted on 02/25/2014 6:00:41 AM PST by son of terrence
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To: IMR 4350

And by Kruegerands I mean gold and silver. Not all large denomination but little ingots too for small barter.

When the ship hits the fan, greenbacks will be used for wallpaper and bit coins will be nonexistent as the web will be a memory.


18 posted on 02/25/2014 6:06:01 AM PST by Vaquero (Don't pick a fight with an old guy. If he is too old to fight, he'll just kill you.)
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To: Vaquero

If/when the SHTF it will be the people with the skills and means to provide food and protection that will be raking in the gold, silver, other precious metals, diamonds and anything else of value.

Plant and grow 1# of seeds and you will get 10#s of gold.


19 posted on 02/25/2014 6:50:28 AM PST by IMR 4350
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To: IMR 4350

Food is one way. Food and guns is another and just guns still another.
Guns and gold another. Just gold another.

Food gold and guns and determination probably the best.

In any case it won’t be a cakewalk for anyone.

But bitcoins will NOT be in the mix


20 posted on 02/25/2014 7:10:37 AM PST by Vaquero (Don't pick a fight with an old guy. If he is too old to fight, he'll just kill you.)
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To: cincinnati65
"But who is going to enforce the "theft" of a virtual currency, not backed or regulated by any government? Is it a felony or a misdemeanor?"

That is a big question, in this case it should be the government of Japan since Mt Gox is headquartered there. It would certainly be a felony given the value of the stolen items. What exactly can be done about it is a different question. However, it's no different than someone hacking a US bank's computers and transferring millions to a Zimbabwe bank. Who enforces the crime when someone commits identity theft and transfers a few hundred thousand to a foreign country? The practical answer is "no one".

"One of the major problems with Bitcoin is its value is simply the perception of its value. If "people" think each Bitcoin is worth millions, then BTC are worth millions. If "people" think each Bitcoin is worth $0.25, then it's worth a quarter."

You have perceived a central tenet of economics. Nothing is worth any more or less than what someone is willing to pay for it. In particular, US dollars have absolutely no intrinsic value.

Some things have value based on utility, but again what someone is willing to pay for them can vary widely. The same car would be worth a lot less in an environment with very expensive gasoline, for instance. It would be worth scrap metal prices in an environment with no gasoline.

"You talk about inflation and government manipulation? The prices on the exchanges have ranged from $135 to $1200 per BTC within the past six months, and I'm supposed to feel secure about that?"

That is not atypical of any currency, including gold based currencies. Bitcoin is more similar to gold-backed currency than fiat currency in that a) real effort must be expended to "mine" it and b) there is a fixed total amount, making it a deflation-oriented currency. It is inherently anti-inflationary.

"You talk about inflation and government manipulation? The prices on the exchanges have ranged from $135 to $1200 per BTC within the past six months, and I'm supposed to feel secure about that?"

As I said, even gold can be similarly volatile. It went from $1800/oz to $1200/oz in a little over six months. That's a 33% decrease.

Bitcoin is a new thing. The perceived risk should decrease over time, which will reduce downward volatility. Upward volatility is harder to predict - the more BTC is adopted, the more upward pressure there will be. Plus there is the possible factor of people fleeing fiat currencies and bad government policy. Those are the two factors that caused the big runup in price between last November and December. That said, no one holding BTC is ever sad about upward price movement.

Fiat currencies have historically had volatility that makes Bitcoin look like the soul of stability. The top five hyperinflation events had the following monthly inflation rates in their worst month:

Those figures are from Wikipedia. Let's hope the US dollar doesn't ever come close to doing that!
21 posted on 02/25/2014 7:57:54 AM PST by PreciousLiberty
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To: Vaquero

“But bitcoins will NOT be in the mix”

Neither will dollars, bonds or equities. Are you holding any of those?


22 posted on 02/25/2014 8:29:53 AM PST by PreciousLiberty
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To: Errant

no way they lost almost 800K BTC and don’t know where the coins went. Sounds like they got stuffed in someone’s personal account.


23 posted on 02/25/2014 8:35:34 AM PST by ClayinVA ("Those who don't remember history are doomed to repeat it")
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To: coloradan
then you obviously don’t have what it takes to be a central banker nor a CEO of one of the TBTF banks.

Yes, but I probably don't have to worry about 'falling' off the top of a tall building, either.

24 posted on 02/25/2014 5:06:41 PM PST by PAR35
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