What are your thoughts on BitCoin?

[Harv]

What is the latest news I hear?

 

[Kaitzilla]

Mt. Gox is ... bankrupt!

http://recode.net/2014/02/24/the-mt-gox-bitcoin-exchange-has-disappeared/

The one-time giant of bitcoin exchanges Mt. Gox has gone offline, adding fuel to claims of other bitcoin companies that the exchange is about to declare bankruptcy. The exchange’s website was showing a blank white page as of about 10:30 pm ET on Monday evening amid reports on Reddit and Twitter that Mt. Gox had halted all trading.

Earlier on Monday evening a group of bitcoin companies, which included Coinbase, Circle and BTC China, said they were issuing “a joint statement to the Bitcoin community regarding the insolvency of Mt.Gox.” The statement later removed any mention of insolvency, but a spokesman for the group told Re/code that “Mt. Gox has confirmed it will file bankruptcy in private discussions with other members of the bitcoin community.”

Re/code has so far been unable to independently verify that claim. Mt. Gox did not immediately respond to an email request for comment on Monday evening.

“In order to re-establish the trust squandered by the failings of Mt. Gox, responsible bitcoin exchanges are working together and are committed to the future of bitcoin and the security of all customer funds,” said the statement, published at 10 pm ET on Monday. “As part of the effort to re-assure customers, the following exchanges will be coordinating efforts over the coming days to publicly reassure customers and the general public that all funds continue to be held in a safe and secure manner: Coinbase, Kraken, BitStamp, Circle, and BTC China.”

If this is the end for Mt. Gox, it’s not clear whether its customers will lose the fiat currency or bitcoin held by the exchange. The price of bitcoin tumbled down to $500 on the news, according to industry trade publication Coindesk’s Bitcoin Price Index.

Mt. Gox, which is based in Japan and was once the largest bitcoin exchange, has been plagued by technical problems in recent months. In recent weeks, the company suspended withdrawals from the exchange, sending the price of bitcoin crashing down to $135 on the exchange. The price of bitcoin on Mt. Gox has not been factored into Coindesk’s index for some time.

On Sunday, Mt. Gox CEO Mark Karpeles resigned from the board of the industry’s trade group, the Bitcoin Foundation.

What technical problems?
http://www.bbc.co.uk/news/technology-26333661

Lost Bitcoins?

MtGox halted transfers of the digital currency to external addresses on 7 February.

The Tokyo-based firm said it had found a loophole that thieves could use to fool the transaction process into sending double the correct number of Bitcoins.

The issue also left it vulnerable to attacks, which slowed down the rate at which coins could be bought and sold.

The loophole was also thought to have been exploited by thieves, who stole about $2.7m in Bitcoins from the Silk Road 2 website earlier this month.

However, last week, the exchange said that customers would be able to starts withdrawals "soon".

One report claimed on Monday that the exchange had become "insolvent" after losing 744,408 Bitcoins - worth about $350m (£210m) at Monday's trading prices.

OMG

Aren't there only 15-20 million of the things in existence?
That can't be right.
If true, there is no way to get that money back either.

 

[useless]

This is hilarious.

The fallout will probably get worse

 

[Antilogic]

Wasn't MtGox the largest exchange for bitcoins?

And apparently this theft has been going on for years.

 

[useless]

shock as unregulated internet funmoney is riddled with huge scams and other shadt business

the beauty of the free market folks

[–] -xyz -5 points 5 hours ago
Be the leader of your marriage, sir. If it's money you have earned, it's yours to do with as you see fit to benefit your family. Take on-board constructive criticism if you will, but you need to have the final say, otherwise things are not healthy. It's amusing that people think you being controlled is how you keep a healthy relationship. That's my 2 BTC, just needed to be an alternate voice so you don't keep getting kicked around while you're down. Lead, dammit. Always.

[–] baconslammer 4 points 3 hours ago
Ah, I suppose I left out a critical detail -- it is my wife's money.

this whole thing is completely insane, a literal cult

 

[Cutlass]

Wasn't MtGox the largest exchange for bitcoins?

And apparently this theft has been going on for years.

And they've been saying all this time that it wasn't possible.

 

[Mise]

That xyz guy sounds like a right £%^&

 

[Algeroth]

And yet all other exchanges are back where there were before.

 

[Harv]

Mt. Gox is ... bankrupt!

. . . .


What technical problems?

. . . .


OMG

Over in the "Money" Thread, you were going over minutes from the Federal Reserve during the crash of 2008. Do you think there are parallels?

Sub-prime mortgages are just a blip. Banks are in good shape. Bear Stearns is fine. Lehman Brothers not going bankrupt, etc.

Regarding Bit-Coin, I really do not understand what makes them valuable. It looks like a fad, and they are in limited supply. When the fad dissipates, so will the value.

EDIT: Fixed a grammar glitch - changed "so will be value" to "so will the value"

 

[Kaitzilla]

Over in the "Money" Thread, you were going over minutes from the Federal Reserve during the crash of 2008. Do you think there are parallels?

Sub-prime mortgages are just a blip. Banks are in good shape. Bear Stearns is fine. Lehman Brothers not going bankrupt, etc.

Regarding Bit-Coin, I really do not understand what makes them valuable. It looks like a fad, and they are in limited supply. When the fad dissipates, so will be value.

There are always parallels with human beings involved

Just remember,

"When it becomes serious, you have to lie"
-- Head of the EuroGroup -- Mr. Junker -- April, 2011

http://euobserver.com/economic/32222


Link to video.


It sure does look like a fad, doesn't it?
Maybe Bitcoin will find a niche and surprise us by surviving.

 

[Crezth]

 

[Algeroth]

Regarding Bit-Coin, I really do not understand what makes them valuable. It looks like a fad, and they are in limited supply. When the value dissipates, so will be value.

Fixed it and provideded explanation in the same quote!

 

[Farm Boy]

People value them, therefore they have value. Sounds about like every arbitrary ass currency or pretty metal. I suppose the prime difference is you can't pay taxes in them(if Hygro is to be believed, ), like you need to with $, and if you own things and don't have $ to pay taxes then you either cease to own things or the men with tin on their chests and guns on their hips will find you, eventually. So the primary difference between what makes bitcoins valuable and dollars valuable is the force of the state leaning on its citizens? Eh, let the boys play with their fun money.

 

[warpus]

The main problem with bitcoins, as I see it, is that there is only a very small supply of them.. and while this supply increases, it does so very slowly. To me that's an indicator that it wouldn't make a very good currency for everyday transactions, but then I'm no economist either

 

[Tahuti]

The main problem with bitcoins, as I see it, is that there is only a very small supply of them.. and while this supply increases, it does so very slowly. To me that's an indicator that it wouldn't make a very good currency for everyday transactions, but then I'm no economist either

Depends on what you use the currency will be used for. As long as money isn't used for the oldest reason why money exists - debt - deflation isn't really a con. You can't really compare private currencies to national currencies, since national currencies have to be multifunctional, private currencies can be used for very niche purposes, like ordering drinks at a nightclub for instance.

 

[warpus]

It's not deflation I was pointing out but rather the fact that there is just such a small supply of this currency around. How could everyone in a large country switch over to this currency? - there doesn't appear to be enough of it around .. to go around.

 

[Samson]

It's not deflation I was pointing out but rather the fact that there is just such a small supply of this currency around. How could everyone in a large country switch over to this currency? - there doesn't appear to be enough of it around .. to go around.

I thought the point was that they were highly divisible, so you could split them up such that there were more "little bits" than we would every need.

 

[Mise]

The main problem with bitcoins, as I see it, is that there is only a very small supply of them.. and while this supply increases, it does so very slowly. To me that's an indicator that it wouldn't make a very good currency for everyday transactions, but then I'm no economist either

To me, this is the main problem with using it as a currency. I disagree with Kaiserguard: "debt" is an amorphous accounting structure; it doesn't need to be a formal debt from a bank for it to be considered "debt". For example, if I defer buying a car for £1,000 from now until 2015 (because I believe that it will be cheaper in 2015), then I am lending my future self £1,000. OTOH, if I bring forward a purchase from 2015 to now, then I am borrowing from my future self. In any case, it's obvious that deflation will induce people to defer purchases, which causes more deflation, which causes more deferred purchases, eventually crippling the economy.

Cutlass talked about this at length previously, so I'm not sure why I'm repeating it, rather than referring to his posts!


All that being said, I don't think it's value is in a traditional currency at all. But again, all this has been said already...

 

[warpus]

I thought the point was that they were highly divisible, so you could split them up such that there were more "little bits" than we would every need.

I'm not sure about that, but that's not entirely what I meant either. It's not that there aren't any $10 equivalent bitcoins around (or whatever), it's that the grand total amount of all the bitcoins in the world are not enough for everyone to play.

There is a mechanism by which new bitcoins are created, but the process is inherently very slow.

 

[Cutlass]

I think that this evidence that it's not as safe as it was supposed to be should be the final nail in the coffin. At least for anyone really thinking about it.