Hundreds of folks ready to sue Bitcoin exchange MtGox Over 400 people have expressed an interest in joining a class action lawsuit against Bitcoin exchange MtGox, according to a British-based law firm. Selachii has been gathering up investors stung by the collapse of the exchange and the prospect that it may have lost 750,000 of its customers' Bitcoins and 100,000 of its own, …
How could you say such a thing Sparticus? Yet another hilarious but all too apposite comment cruel slur of bitcoin. You have to understand that bitcoin is or may possibly be a FIAT currency used only by either criminals or naïve idealists where the former want money laundering facilities and the latter are too stupid to think through the risks is a pure Cypto-currency untainted by the corruption and thievery of the existing banking system.
Exchanges such as MtGox are probably run by the same sort of criminals, and naïve idiots …. In fact who in the holy name of deity thought they would get the money back? the very pinnacle of the bitcoin utopia. You would have to be totally mad very cynical to think that the these self-same bunch of criminals and losers who barely understand finance committed people involved with this ideal aren’t either laughing all the way to the bank or stunned by the shafting that they just took respectively trying to move heaven and earth to restore the losses of the investors.
Also remember that MtGox is the first with every indication the rest will be following down the pan shortly but one of the exchanges and whilst the failure a humorous indicator of the bitcoin trend and is with any luck the death knell of this techno babble an unfortunate blip . The bitcoin systems is without doubt a house of cards waiting for a puff of wind robust and hopefully not scam too many more idiots will fulfil its noble ideals.
Since seeing this article I haven’t stopped laughing have sold my, house, car, wife and two of my three children so strong Is my belief in this pure and noble cause. I should coco suckers … the great thing about currencies outside of either government control or for that matter other control is that nobody is responsible I intend to invest all of my considerable fortune yea right in restoring the bitcoin system to its rightful status.
So Sparticus final word on this one top comment entirely worthy of an up vote if for that matter I cared one way or the other … actually I do think I should get some recognition for all my down votes perhaps in future you might chose knock it on the head son, I have lost a keyboard and should probably be working to post comments that are a little less ignorant of bitcoin really I mean really are there people so stupid as to believe this nonsense …. Ah well I guess the phrase is ‘One Born … ‘ ?
No it isn't.
Gold is real. It is rather difficult to mine, and somewhat dangerous to purify.
Mining VirtCoin is just having the hardware and waiting for the ones and zeros to align properly.
Nothing real, nothing difficult, just a program chugging away wasting time. The only reason people are complaining is because some (enough) have been stupid enough to think that money could actually be made out of this scheme.
Ironically, money will now be made. By lawyers.
>>"Gold is real. It is rather difficult to mine, and somewhat dangerous to purify. Mining VirtCoin is just having the hardware and waiting for the ones and zeros to align properly.
There are a finite number of possible bitcoins and the difficulty of mining them (which translates into real costs of electricity and hardware that deprecates in value) increases with time.
Dammit Sparticus next you will be suggesting that these fine upstanding members of the legal profession are in fact the circling sharks who have smelled the blood from a suitable shoal of fools prepared to throw good money are just out for money from the self righteous idiots who bought into this nonsense tragically defrauded bitcoin investors.
You have to remember this is tulip mania or the south sea bubble, a get rich quick ponzi scheme a legitimate crypto-currency. I frankly can't feel sorry for these chumps feel nothing but sympathy for all the deeply wronged investors and will struggle to contain my mirth ... particularly for those who have down voted my posts suggesting that this might happen my grief at these tragic events.
Finally all I can say is as a future thought, to all you bozos, there is a lot of sense in the phrase "if it seems too good to be true ... it probably is" my thoughts go out to the those who have lost so much and their families .... I genuinely feel for you all. Just wiping a tears of mirth from my eyes.
"It's not like there's any realistic chance of getting anything back."
Au contraire, mate. With assets of $38m and liabilities of $64m there's potentially the better part of two thirds of creditor's money still there. However, from a vulture-like lawyer's perspective, that isn't creditor's money, it's simply a big, glistening pile of $38m, from which some fat and undeserved fees will be pulled before the creditors get their even more reduced portion back. Assuming there's no preferred creditors, then the unlucky fools who have "lost" bitcoins would be better off waiting for the restructuring process to run its course (which too will cost money coming out of that suddenly shrinking $38m).
The amusing thing in this situation is that by suing MtGOX, the creditors are agreeing to underwrite their own lawyers. MtGOX or its administrators will have to be legally represented, and those costs come out of the MtGOX assets.....so by suing, the creditors agree to pay both sides of a legal dispute they started, regardless of the outcome. Smooth.
Surely if Bitcoins are ... An alphanumeric data sequence, then it's an IP theft issue? or am i missing something?
Like Mark says, IP theft should probably be copyright infringement. However, there is indeed something missing here, because fiddling the "alphanumeric data sequence" of somebody else's Visa account doesn't really fit into the "three strikes" meme - although a few people might consider a first offence warning letter to be preferable to jail time.
Using this analogy, I'd say the stolen bitcoins are already catfood.
Also can we stop referring to Bitcoins as a currency, they are not, they are a commodity. If anything they could be used to back a currency like Gold was/is but you can't suddenly print more Bitcoins when you feel like it.
Also can we stop referring to Bitcoins as a currency, they are not, they are a commodity. If anything they could be used to back a currency like Gold was/is but you can't suddenly print more Bitcoins when you feel like it.
I thought forgery was a crime.
Oh, but of course, the government minting the currency makes the laws, and exempts itself from that one.
What a definition: it can only be a currency if it can be debased!
And it's for that reason that Governments probably haven't rushed to regulate it.
Yes it is scary. I think we have evolved the phrase "you are only 1 pay cheque away from living on the streets" to "you are only one financial market away from being a 3rd world country"
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You have because they were actual, real objects that are now in someone else's possession.
These VirtCoins may be unique strings of bits (for a given value of unique), but their value is less than the hard drive platters they are stored on (much less).
Besides, if you had a hundred grand of family heirlooms worth nicking, you should also have insurance on them and a valid basis for judicial action.
Oh, and if you haven't paid Inheritance Tax on that then Her Majesty's Revenue Service would like a word with you . . .
"These VirtCoins may be unique strings of bits (for a given value of unique), but their value is less than the hard drive platters they are stored on (much less)."
Cobblers. The value of something is what somebody is prepared to pay for it. That's what makes the world go round (Physicists: This was not an invitation to get technical). So the bitcoins were worth whatever the going rate is, which was about $650 a pop a moment ago.
Your argument is like saying that the tenner in my pocket is only worth about 0.01p because that's the value of the paper upon which it is printed.
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> I suspect you'll be told it's not possible because they're not worth anything
It's possible to insuire anything. You just might not like the premium.
I'll make an offer right here, right now - I'll insure any Bitcoin holding. You can even calculate the annual premium yourself - just multiply the value by three...
Vic.
N.B. No, I don't do instalments.
I've also been wondering about this. How can anyone prove that MtGox had anything of theirs? It may be feasbale to prove that as some point they transferred money to MtGox but what after that? They could have spent them, traded them or whatever. The only way to prove their balance would be to get MtGox to confirm it. I doubt that's going to happen. Probably been shredding all the evidence for more than a month now.
I see MtGox is admitting to £64 million liabilites, while people are talking about them losing £400+ million worth of Bitcoins. Seems to be a massive divergence already.
And why is it they are being sued everywhere EXCEPT Japan?
The owners should agree to settle the lawsuit by paying the people suing them in a new secure crypto currency called MuppetCoins. Here's your pay off in MuppetCoins now pick the bones out of this -
63211C8F5E0BF07DA1ADF4A4738D62D2E875E5BD777D2E05B1AF73382BCF9C3B
84C39F39F668E984229ED5FE2BC70BA08AC3CCE8625D0D2229FF8065AEF0AC7F
575C5DB58D73F0C1C0B99B558E49606115E68A810277B930299F6AB644696F9C
Don't forget to store them in the online exchange that has the best looking website, but more backdoors than B&Q....
Beat me to it.
"Hello, you lost our strings of random numbers. We'd like to sue."
"Alright, you can have your strings of random numbers. Here's some we just got some interns to type out."
"Those aren't PROPER random numbers. We want Bitcoin random numbers that we can use as currency."
"But you keep telling us that if two people are willing to treat strings of random numbers as currency, it's a currency. Even though the currency is not backed by a central bank and not accepted by any government for payment of taxes. So: To us these strings of random numbers are acceptable as currency, and if they aren't to you, well that's basically your problem."
"Er..."
Sue for what exactly?
In both senses of the phrase.
If they win what will they get? Nothing, because no one involved with this had any kind of cash to start with, and whatever they did have is now gone.
An what for in the sense of what offense? I'm sure MtGox offered no assurances that they were a financial institution or that anything given to them was safe/secure/kept to any sort of standard.
The people lost their money the instant they turned it into bitcoin, all that was stolen from/by MtGox were strings of numbers that both parties thought were actually worth something in a real, tangible sense.
They've lost the numbers that allow them to convert a bitcoin back into real money...no real money was stolen.
Newsflash commentard - replace "strings of numbers" with "pieces of paper" and you describe any modern currency. Therefore your argument has no real meaning.
In the sense that people were willing to exchange their own currency for bitcoins then it is a currency. More so given that its possible to directly pay for goods and services using bitcoins.
"In the sense that people were willing to exchange their own currency for bitcoins then it is a currency. More so given that its possible to directly pay for goods and services using bitcoins."
Just because some people accept them doesn't mean that it is a currency. It's a way of paying for a small number of goods, yes, but as it is not widely accepted, by definition it is not a currency.
Just because some people accept them doesn't mean that it is a currency. It's a way of paying for a small number of goods, yes, but as it is not widely accepted, by definition it is not a currency.
Hmmm. Is the Kyrgyzstani som a currency? (I had to look it up, but I haven't made it up). If you were offered bitcoins or som to the value of £200 at current quoted exchange rate, which would you take?
I'm not sure "currency" has any official definition, and in any case all forms of money conflate at least two separable functions. (1) A common medium of exchange. (2) A store of value. The first requires liquidity and fungibility, but value needs to be preserved only in the short term (long enough to spend or convert your earnings without suffering an unacceptable loss during the days you hold them). Stores of value can be non-fungible (e.g. works of art) and illiquid (e.g. works of art, houses in a buyer's market).
"Hmmm. Is the Kyrgyzstani som a currency? (I had to look it up, but I haven't made it up). If you were offered bitcoins or som to the value of £200 at current quoted exchange rate, which would you take?"
I would take the som, because I could walk into my bank and exchange it then go no more than 10 doors down to spend it in the pub. Much better than trying to find a magic bean exchange to get some beer tokens back out.
The big difference being generally one or more governments are willing to back a currency. Who will back bitcoin? It's not a currency just because some people will buy it hoping to sell high.
The thing about bitcoin is that for all the talk, it's not really being used as a currency. A currency is for purchasing goods and services (and paying taxes). Ok so theoretically you can buy things with it from an incredibly small selection of vendors. (You would have had a bit more, but not much, opportunity in the recreational pharmaceuticals market until recently, but 99.9999999999% of that still uses traditional money). Mostly, bitcoin is about get rich quick. Either through turning electricity into money through "mining" (pretty much unviable now) or through buying low and selling high. It really is just a big Ponzi scheme.
Try saying that to the barrels of the SWAT team when you nick a sack of banknotes (paper).
BitCoin is a currency the same way bottles of Vodka are a currency : there are rare places that accept to deal with them.
The places accepting bottles of vodka also accept dollars, like everywhere else in the world.
So the difference between any VirtCoin and dollars is that if you steal 400 million dollars, you can be 100% certain that there is someone, somewhere, who's sole mission is to capture you - alive or dead won't really matter - whereas if you steal 400 million VTC, you'll get a lawsuit from another country.
Now tell me which currency is more real than the other again ?
The people lost their money the instant they turned it into bitcoin
No, they converted one currency into another. Bitcoins are still out there and still have an exchange value. Less than it once was ... but currency fluctuations are nothing new. One pound sterling was once worth exactly the same as one gold sovereign. Until a day came, when the UK went off the gold standard.
Their real mistake was allowing MtGOX to look after their bitcoins, rather than holding them in their own digital wallets. Someone broke into the bank and stole their gold, sorry, bitcoins. Now someone else has all the bitcoins, which are worth a fair bit to the thief even at today's exchange rate. MtGOX is doubtless legally liable, but I don't suppose it's got enough assets left to make it worth suing.
"Now someone else has all the bitcoins,"
Personally, I doubt that.
I think it far more likey that through some sort of system (including human) failure, Mt.GOX lost the private keys to their cold storage. That means all those missing bitcoins are still "owned" by the MT.GOX cold-storage public keys, but without the corresponding private keys there is no way to transfer them.
This may have happened a log time ago, and Mt.GOX could have been operating on a very small fractional reserve while they continued to accept both new customers and new deposits (and at the same time dicked around trying to recover their cold-storage keys). It could be that recent malleability attacks drained just enough of their fractional reserve from hot storage to push them over the edge of the cliff on which they'd been teetering for some time.
The true value of a good lawsuit will be in forcing Mt.GOX to explain what happened (admit it, this is all pretty fascinating!).
Nobody but the lawyers will end up with any money.
The numbers DO NOT add up. Surely, their liabilities would be any and all monies deposited by users. i.e. > $300m. Then again with the volatile nature of BTC/USD exchange rate this will go up and down.
Also given they have assets, liquid or not, the lawyers are probably eyeing up that figure. Suppose any "winnings" would be taxable too.
What a joke, somebody is sitting pretty with a lot of crypto coins and absolutely no way to convert them to real money.. oh wait, money isn't real, WTF!
The solicitors are suing because there are assets. There may be more liabilities than assets, which means that its impossible for everyone to get all of their money back... but what is at stake is how much will they get back.
The only thing for certain, is for the solicitors involved, they will get 100% paid, cause when the money runs out, they stop working.
And where do they intend to bring this action. If you want to sue you need to sue in Japan so what's the point in dealing with a British law firm? Of course the law firms will happilly take the punters cash whatever country they happen to be in, even if they know there's no chance of getting the clients their money back.
This makes the law firms every bit as bad as MtGox if not worse.
I transferred everything out of Mt Gox in early 2013 because everything I read suggested:
1. Never leave bitcoin on ANY exchange.
2. Mt. Gox was the most unreliable of ALL the exchanges. A history of loosing money to both hackers and due to government non-compliance.
- apparently I left .08 ($8 worth) on Gox.
Looking through my transaction history, I see I took the time to transfer that last .08 btc out of Mt. Gox in 12/2013 when it was worth $80.
WTF were people thinking - leaving anything of value on Gox?
My 3rd ever Bitcoin transaction was "get it off the exchange"....
I am not sure how much sympathy the poor souls that left value on Gox deserve.....
While some argue that this is part of the process - getting rid of bad players like Gox, it may also be culling out the idiot investors. Both for the better....
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