back to article Cops think Mt Gox meltdown was an 'INSIDE JOB' – report

Nearly all of the funds missing from bankrupt Bitcoin exchange Mt Gox were the result of fraudulent transactions, rather than outside attacks, Japanese authorities have reportedly said. Tokyo's Metropolitan Police Department (MPD) told The Yomiuri Shimbun newspaper on Thursday that no more than around 7,000 of the roughly 650, …

  1. Anonymous Coward
    Devil

    "police now plan to question Mt Gox employees"

    I'd question the ones who now live in a huge mansion first.

    1. Anonymous Coward
      Anonymous Coward

      but

      his mansion is only 'imaginary' or digital as he'd call it, and needs to be converted into real money by a third party.

      Surely to properly pursue this case they must legally define a bitcoin, so they can determine what each person has actually lost.

      because so far they've just lost a string of 0's and 1's, which most people involved in crypto will argue IS a currency, but ISNT a currency when it comes to things like law, controls, tax and all that other boring stuff they don't like the sound of.

      1. Anonymous Coward
        Anonymous Coward

        Re: but

        One would assume that some of the stolen loot has been converted to real money and spent on something. Otherwise, what's the point? It would be like winning the lottery and putting the $50 million into your checking account and never spending a dime of it. I recognize some people wouldn't want to change anything in their life and wouldn't have use of that money, but those people presumably aren't playing the lottery in the first place.

  2. Anonymous Coward
    Anonymous Coward

    Imaginary currency goes "pop"

    Still, you can't lose "nothing".

    1. James O'Brien

      Sure you can

      When you get your money for nothin and your chicks for free

      1. Swarthy
        Coat

        Re: Sure you can

        When you get your money for nothin and your chicks for free
        I want my... I want my... I want my BTC

    2. Anonymous Coward
      Anonymous Coward

      Re: Imaginary currency goes "pop"

      > Imaginary currency goes "pop"

      You do realize that _every_ currency officially in use today is imaginary, right? It has no inherent value, other than the paper it is printed on (or metal the coins are made out of). In that sense, virtual digital currencies are no different.

      You could even argue that value of gold is "imaginary" - it is only worth something because people want it, because it is pretty and shiny. You can't eat it, or do many useful things with it (apart from a few extremely high-tech uses, which require sufficiently little of it that the value of the gold in the end product is not dominant to the price of the product).

      1. Anonymous Coward
        Unhappy

        Re: Imaginary currency goes "pop"

        "You could even argue that value of gold is 'imaginary....'" No argument here. At least platinum and silver have real uses in chemical engineering. Gold? Not useful for much at all and yes, I'm including electronic/electrical engineering as well. What's hilarious is that the "Native Americans" (in all the Americas) liked using gold for decorative items solely due to the fact that it was very malleable and wasn't worth a damn using it for anything else. A bunch of Europeans show up and, well we all know how that turned out. Simply due to their deranged notion that gold had some extreme valuation assigned to it. Sad.

      2. Sorry that handle is already taken. Silver badge

        @AC

        Virtual/digital/crypto/whatever currencies aren't "no different", because they're not backed by governments or central banks with an interest in them remaining stable.

        1. P. Lee Silver badge

          Re: @AC

          >Virtual/digital/crypto/whatever currencies aren't "no different", because they're not backed by governments or central banks with an interest in them remaining stable.

          Are you too young to remember the GBP's exit from the ERM?

          The art market has no government backing but people still participate in it.

          Even at half the value, this is a significant theft.

          1. yoganmahew

            Re: @AC

            "Are you too young to remember the GBP's exit from the ERM?"

            Nope, and I remember that the GBP in my pocket would still buy a pint the next day... stability may well be a moot point, state backing from most states is not.

            1. Primus Secundus Tertius

              Re: @AC

              But do you remember Harold Wilson (*) saying in 1967 "this will not affect the value of the pound in your pocket"?

              (*)British Prime Minister 1964-70 and 1974-76. Devalued the pound in 1967 from $2.80 to $2.40. Currently £1 = $1.56, approx. In August 1939, £1=$4 near enough.

    3. Anonymous (Noel) Coward

      Re: Imaginary currency goes "poop"

      Shitcoins ???

  3. imanidiot Silver badge

    Reaaaalllyy??

    You don't say?

    The phrase "no shit, Sherlock" comes to mind.

    1. Anonymous (Noel) Coward
      Holmes

      Re: Reaaaalllyy??

      "No shitcoins, Sherlock" ???

  4. jake Silver badge

    Gee, you think?

    Unregulated currency + internet == safe place to bank?

    One wonders about the stupidity of the GreatUnwashed.

    1. Mark 85 Silver badge

      Re: Gee, you think?

      Well, there's the late Nigerian mogul who's widow was trying transfer funds but needed some front money for paperwork, etc... so the kind folks who ran Mt Gox decided to help her out at the behest of some of those who put their Bitcoins there. Or maybe someone just clicked an emailed link to naked pictures of some celebrity bimbo while running a browser from a server..

      OK.. to answer your question: the amount is limited only by the number of those living who have a connected computer. It's probably somewhat less than that amount but we have to deduct for a number of IT people.

    2. Matt Bryant Silver badge
      Facepalm

      Re: jake Re: Gee, you think?

      ".....One wonders about the stupidity of the GreatUnwashed." Comforting as it would be to assume it was just "the Great Unwashed", I suspect the majority of the Mt Gox victims were probably techies that fell for the idea that their geekiness could actual make them rich. I know one victim in the States, he gave up his IT job and took out a second mortgage to build his own farm of Bitcoin mining machines, had to upgrade the dozens of graphics cards every six months, but thought he was on the road to riches. He's now trying to claw some money back selling his used rigs on eBay.

      1. Mike Moyle Silver badge
        Coat

        Re: jake Gee, you think?

        "Comforting as it would be to assume it was just "the Great Unwashed", I suspect the majority of the Mt Gox victims were probably techies that fell for the idea that their geekiness could actual make them rich."

        So, the Lesser Unwashed, then.

  5. Pascal Monett Silver badge

    "how the exchange was run"

    I'm sure that the report on its administration would make a brilliant demonstration of how NOT to run a web business.

    It is therefor sorely needed.

    1. Allan George Dyer Silver badge

      Re: "how the exchange was run"

      Although it is the most spectacular (so far), there are millions of ways to run a web business badly.

  6. Phredd

    "Funny Money"... all of it.

  7. Henry Wertz 1 Gold badge

    Splitting hairs, or...?

    First off... the central banks of many nations are behaving quite dangerously and irresponsibly, there's truly no reason to say dollars (or pounds) are a solid way to store your wealth but BitCoins are not.

    That out of the way... if an "unknown party" was "fraudulently" operating Mt. Gox, couldn't that be a hack (or as they call it now a "cyber attack"?) (Clearly it's not the SAME attack as the 1% of bitcoins but still) .Or are they pretty sure iy's fraud by someone at Mt. Gox and just not sure who specifically?

  8. David Pearce

    How many suspects? MtGox wasn't a bank with thousands of employees, I would suspect no more than 10

  9. razorfishsl

    yep....

    All the time this goes on, the amount of money to be returned to the account holders slowly diminishes in 'administrator fees'.

    They could have sold the coins they had and repurchased at the lower rate, thereby ensuring EVERYONE got ALL their coins back, as it is they have completely destroyed the value of the assets of the company... something NO administrator should do.

    1. Vic

      as it is they have completely destroyed the value of the assets of the company... something NO administrator should do.

      I watched the SCO bankruptcy play out. Leeching out all the value of the company appear to be standard practice...

      Vic.

  10. Samizdata
    FAIL

    Such an AMAZING surprise from an organization that will take your money but not let you get it back.

  11. Tom 13

    I've never understood how people

    can visit an illegal gambling site and not expect to get taken. (Granted, even visiting a legal gambling site is an invitation to be taken, but at least it usually has some parameters established for the maximum they can take from you.)

    Now, before you go off on a BitCoin is legal rant, please note that is quite beside the point here. Mt. Gox were known to be engaged in shady dealings. Such dealings are normally in an accepted currency. So it's not so much the currency as those other dealings which are the problem.

  12. Anonymous Coward
    Anonymous Coward

    Everyone already suspected this was highly likely when all the data regard willy and markus was released.

  13. Baggypants

    Mt.?

    Mt Gox? Silly people, it's not a mountain. it's Magic the Gathering Online Exchange (MtGOX). Which I think reveals the problem. ADnDOX would have been much more secure.

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