
I'm the guy who bought 259684 Bitcoins for under $3000 yesterday (2011) - baazaar
https://bitcointalk.org/index.php?topic=20207.0
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thechut
I was around when this happened. If I recall correctly, Mt. Gox ended up
rolling back all the trades by doing a "restore" to a certain date before the
sell off happened.

toasty didn't get to keep any except for the 600 some he withdrew.

He actually had to go through a lot of trouble to prove he wasn't the hacker
originally responsible for the Mt. Gox hack.

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hoers
that sucks

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exch
Given the current exchange rate, those 600 BTC would still net him
$628,932.00. That seems like a pretty good deal. Granted, it could have been
nearly $260 million, but I guess one can never have it all.

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hoers
Totally true. I rather meant Mt.Gox' decision of handling it.

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dangero
The important point about this incident was that there were no real Bitcoins
involved. What happened was that someone added coins to an account balance on
mtgox and then sold them. When you are using mtgox you are not actually buying
and selling bitcoins. You are buying and selling IOUs for bitcoins and that is
why MtGox was able to just roll back later.

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infinitone
Wait... is that how an exchange works? or just gox? I mean, so do they only
actually buy the bitcoins when the user wants to cash out from the account?

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dangero
An exchange is nothing more than a marketplace for buyers and sellers. They
could in theory not buy the coins till you wanted to cash out, that would be a
Ponzi scheme. That happened recently with a small exchange site. See this
article:

[http://www.wantchinatimes.com/news-subclass-
cnt.aspx?id=2013...](http://www.wantchinatimes.com/news-subclass-
cnt.aspx?id=20131115000043&cid=1103)

In general the way it works for a non ponzi scheme setup is that another user
on MtGox is selling, and you are buying, so essentially if you buy, your
account balance of coins goes up and at the same time the seller's balance
goes down. Keep in mind though, no actual bitcoins moves because MtGox is
holding them all in their account. It's exactly like what happens when you
transfer money to someone who banks at the same bank as you. The money moves
from one account to the other on the ledger, but really no money moved at all.

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fat0wl
So do they get a transaction fee every time even though all they're doing is
changing the id of the owner in their database?

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o_s_m
Yes they do. Mt.Gox gets the transaction fee.

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keyle
Was this title changed to [2011] only once it hit the front-page?

I was on the forum reading the post with no date context, I thought it was
"yesterday", up until I refreshed the home.

Is this a common approach to get historical stuff on the home? Post an
extraordinary title and let it rise to then rename it to the fact that it is
historical?

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xerophtye
Same happened with me. i thought this happened last night. (lets not forget
this is a NEWS site, so expecting posts about CURRENT events is the default
modus operandi)

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jmduke
The hugest takeaways from the thread to me were that the administrators of Mt.
Gox were _way_ over their head, and that the posters on the Mt. Gox forum were
about par for the course in terms of tech-skewed internet forums.

~~~
sjtgraham
That's the most worrying thing about BTC for me, too much of it is run by
people in over their head, and now it's mega serious money.

~~~
daliusd
So just like in real banking? Nothing to worry about IMHO.

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wsxcde
This part is interesting.

> _I attempted to withdraw the bitcoin balance into my own wallet, and hit the
> limit that Mt Gox has, preventing you from withdrawing more than $1000 USD
> worth of bitcoins (at the current market value) in a day._

What is the reason for all the limits and delays that exchanges impose on
converting Bitcoin into USD? These appear to prevalent even today.

For example, MtGox says:

> _\- Withdraws lower than 100.00 EUR are on average take less than a week._

> _\- It takes at least a month on average for withdrawals larger than 10,000
> EUR

> _\- Withdrawals greater than 50,000 EUR need to be split it into multiple
> transfers or you can use the International Wire payment method.*

Coinbase says:

> _I assume you 're talking about selling coins here though. It's 100 BTC a
> day, and that can be done on successive days - in this example it would take
> 5 days to withdraw 500 BTC. Hope that helps!_

I guess the goal is to somehow prevent fraud. But (a) how do the delays and
restrictions help? and (b) what is the long term prognosis here? Will these
limits ever go away, and if so, what would have to change for this to happen?

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alanctgardner2
As far as I can tell it also helps avoid bank runs. If you can only withdraw a
small amount of your balance every day, it may prevent the price from tumbling
precipitously when people get spooked - they would have to consciously cash
out over many days. It might also allow the exchange to operate with money it
doesn't actually have, but that's just speculation on my part.

~~~
wsxcde
> _As far as I can tell it also helps avoid bank runs._

Sounds plausible but it puts the exchanges in a major position of power in the
bitcoin economy. If they're actively managing liquidity of the BTC economy in
this manner I have a hard time understanding why they're any better than the
central banks that bitcoiners are attempting to disrupt.

> _It might also allow the exchange to operate with money it doesn 't actually
> have, but that's just speculation on my part._

Let's hope not, because that is literally a ponzi scheme.

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Macha
Thread from when this happened:
[http://news.ycombinator.com/item?id=2676263](http://news.ycombinator.com/item?id=2676263)

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grecy
Seeings this is from 2011, what was the outcome?

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loceng
And I am curious if the owners of Mt Gox are the ones that end up keeping
these Bitcoins for themselves? Makes it quite the valuable business to be a
middle person in..

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jimmcslim
This is what the banking industry have known for years! Keep clipping the
tickets...

~~~
darkmighty
Yep, bitcoin is being heralded as the great successor to malignant bankers and
their greed only to be almost completely reliant on shady exchanges.

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hkbarton
When everyone are talking about bitcoin, it's the time the bubble will burst

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eonil
So if he kept it, he now got about (1000/(3000/259684))x profit!

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Matsta
Wow so 259684 BTC at $939 (current buy price as I post this) is 243185236.74 =
$243,185,236.74 :o

~~~
kaybe
It's not that easy.. an amount that huge would definitely affect the market
severely.

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adventured
There's enough volume now to space a quarter of a billion dollar exit out over
two quarters, and most likely at or above $1,000 per. Volume and demand will
continue to increase predictably for while yet, making it even easier as each
day passes.

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antocv
The bitcoin exchanges and trade platforms are a scam.

Its a worse market than wallstreet.

Read Kevins post without your bitcoin-glasses on for reasons why.

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josu
I wouldn't say it's a scam per se, but it could become one really fast. Right
now there are 15 bitstamp employees, what's stopping any of them from taking
the money and running?

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sailaway
bitcoin had just hit a $1000 a piece.

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mcantelon
This is from 2011.

