
Defending Bitcoin, Andreessen Says Mt. Gox Is 'Like MF Global' - rajbala
http://dealbook.nytimes.com/2014/02/25/defending-bitcoin-andreessen-says-mt-gox-is-like-mf-global/
======
lmg643
it's not much like MF global when you think about it, other than a financial
institution failing.

MF global collapsed due to risky behavior by management team. left a lot of
assets, and operates in a regulated sphere where principals are known and
subject to courts. the scandal of MF global was that the former governor of
new jersey, and goldman sachs bigwig, was so arrogant that he though he could
prop trade with customer funds...and lost.

Gox collapsed due to incompetent security procedures, if i understand the
story correctly. a bank robbery of a sort. outside of the jurisdiction of many
of the victims.

we now know that something around 6-7% of the total bitcoins in circulation
are now owned through theft. that's a staggering amount. in any normal
currency - the heist of a millennium. there's no court system to adjudicate
this or try and recover assets for those who lost money.

we know who is responsible for MF global and we know where to go to recover
assets. John Corzine might be politically connected, and the folks who lost
money might have a hard time overcoming "the system" to get funds, but they
know where to go.

And - quick google search - there was $1.5bn in missing funds, which
apparently will be recovered: [http://dealbook.nytimes.com/2013/11/05/mf-
global-customers-w...](http://dealbook.nytimes.com/2013/11/05/mf-global-
customers-will-recover-all-they-lost/)

With Gox? Tough luck I guess. (I lost a token sum, FWIW).

It's enough to make you wonder - if digital currencies are now well
understood, flaws analyzed and hacked... and we are starting to know enough to
say - digital currency is awesome...

Maybe we should start over with another alt-coin. i'm not particularly
thrilled about putting real money or time behind a coin which now has a large
chunk of it owned through theft.

~~~
rayiner
> we now know that something around 6-7% of the total bitcoins in circulation
> are now owned through theft. that's a staggering amount. in any normal
> currency - the heist of a millennium. there's no court system to adjudicate
> this or try and recover assets for those who lost money.

You say that like it's a problem. Who cares if some people lose their
Bitcoins? Nobody is holding Bitcoin involuntarily, after all. Not having a
court system to adjudicate this or recover the assets is part of the point of
Bitcoin! It's an experiment in anarcholibertarianism, and at least in theory,
measures should arise organically in the Bitcoin community to prevent
something like this from happening again. The stable price of Bitcoin suggests
that the community is optimistic.

~~~
beedogs
Comments like this are why I wish "Shit HN Says" still existed on Twitter.
Holy crap. The level of pie-eyed idealism is just astounding.

Yeah, it's a good thing this $400M theft just happened! It's a feature, not a
bug! Now we can make Bitcoin better! Derp!

~~~
Crito
I think he may _actually_ be coming from a _" You guys made your bed, now lie
in it"_ angle, though couched in the language of bitcoin evangelists to
disguise the sarcasm.

I would sympathize with that, if not for the fact that buying into bitcoin
does _not_ require buying into ideologies.

Or he's sincere, in which case I disagree for the same reason.

~~~
rayiner
That makes it sound punitive. I just think it would be a fascinating
sociological experiment to let Bitcoin evolve in a way that would allow
anarchist ideas about the viability of markets in the absence of centralized
power to be empirically tested.

~~~
Crito
I apologize if I misread your intent, you just don't really seem like a _"
fuck it, let them have their fun"_ kind of guy.

Anyway, I don't think that declaring bitcoin to be out of touch by the law
would be any better an idea than saying that Idaho should do their own
anarchist experiment. In both cases you have people who either do not buy into
the ideology getting caught in the crossfire _(as well as people who buy into
the general idea but do not believe that the prerequisite conditions have been
met, or do not believe that the required complementary technologies exist
yet.)_

You would at least need to give those people an opportunity to get the hell
out of Dodge^W Idaho. Even then though you would be unjustly displacing those
people. Imagine if you purchased a house in Idaho, only for the federal
government to declare Idaho to be a lawless land set aside for all the
'sovereign citizens' to experiment with. You would not be to pleased.

------
cstrat
I don't understand why Mt Gox isn't able to pursue the thieves. You can only
withdraw funds if you have a verified account. For verified accounts they
would have proven the users identity.

It must be possible to work out which accounts have withdrawn more money than
deposited.

Obviously the people who did this would have covered their tracks. However
that being said, there should be ways that they can account for which user
accounts stole coins. Go from there.

~~~
corresation
Are there even thieves? I mean, the whole story makes zero sense.

Supposedly the root of this was multiple withdrawals over the period of
months. How is it _remotely_ possible that Gox didn't have a real-time, if not
at worst case daily, comparison between their wallet holdings, as reflected in
the blockchain, and their outstanding "deposits"? How could that possibly be?

I just cannot buy that story. Saying "they were incompetent" doesn't explain
it. The multi-withdrawal thing only makes sense if it was a mass exploit in a
short period of time.

~~~
lutusp
> How is it remotely possible that Gox didn't have a real-time, if not at
> worst case daily, comparison between their wallet holdings, as reflected in
> the blockchain, and their outstanding "deposits"? How could that possibly
> be?

Not to defend Mt. Gox, but they weren't the only company to be cyber-robbed
recently:

[http://www.ibtimes.co.uk/silk-road-2-0-pledges-
repay-1-7-mil...](http://www.ibtimes.co.uk/silk-road-2-0-pledges-
repay-1-7-million-users-after-bitcoin-theft-1436890)

Apparently, in virtual currency dealings it's possible to be robbed blind and
not see it. Pun intended. :)

------
panarky
Andreessen: "Mt. Gox has been obviously broken and possibly outright crooked
for months."

