
I am Mt. Gox's first employee – AMA - dmichulke
http://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_barr_aka_adam_turner_the_first_mtgox/
======
patio11
Notable tidbits (most of which were already public record if you followed the
story very closely) include:

\+ Mt. Gox commingled depositor and corporate funds. (Corroborated in the
Japanese version of their docs released by the bankruptcy trustee.) Many in
the community believed that they had promised not to do this (true) and they
this was impressively unprincipled (I lean against this understanding).

\+ Mt. Gox had standards of engineering professionalism which were not what
one would hope would prevail at a financial institution with $500 million in
assets. True and previously reported. Specific examples include lack of a
staging environment, source control, testing procedure, engineering
leadership, auditing... it goes on. Also might suggest in future not putting
all code into MySQL.

\+ At one point all BTC deposited at Gox were accessible by VNCing into a
particular box, which suggests that claims that Gox had cold storage secured
by keys kept in diverse physical locations were not consistent with
conventional interpretations of engineering reality. (The new information here
is "VNC." It was previously known that at one instant in time Gox proved its
reserves by moving all it's BTC in a single transaction. This could be done in
a way consistent with what the community thinks "cold storage" should mean;
the VNC bit militates against that understanding.)

\+ Employees of Mt. Gox believed, on the basic of public evidence, that the
firm was losing money even at the peak. (I'd be interested in seeing their
math for this; that was not the conclusion I reached in a napkin calculation
in mid-2013.)

\+ Wages at Tibbanne (which provided 100% of employees for Gox) were
consistent with prevailing wages in Tokyo startups i.e. scandalously low. 50%
of employees earned less than $2k per month; director-level salaries in order
of $4k, except for...

\+ ... explicitly alleged looting of customer funds to support director
lifestyles.

\+ Management was unable or unwilling to answer basic queries regarding
finances internally.

\+ Gox's bus number was one, and that bus would have resulted in $500 million
being unrecoverablu lost. Management, when asked about this, lied brazenly.
(Last part is new info, first part obvious.)

There's more at the link.

~~~
astrange
> \+ Wages at Tibbanne (which provided 100% of employees for Gox) were
> consistent with prevailing wages in Tokyo startups i.e. scandalously low.
> 50% of employees earned less than $2k per month; director-level salaries in
> order of $4k, except for...

I've been told that employees at a certain like-deviantart-but-good startup
are paid about as much as a convenience store worker. On the other hand, the
conbini won't sponsor your visa.

~~~
sandGorgon
that does not tell anything - are they employees in a different country ?
Convenience store workers in the US earn about 20K USD per year - that is
double the salary what a comp sci fresher from a tier 2 college (non-IIT)
would earn in India. And that's a reasonable salary - at 10K USD per year, you
can eat out everyday at pizza hut ("regular" food is cheaper), drink a couple
of times a week and share a 3 bedroom apartment.

~~~
sdrothrock
The "deviant-art-like-but-good" bit is probably referring to pixiv, a popular
Japanese art site.

You're not going to live anywhere near a comfortable life in Tokyo on 2
million JPY a year, much less 1 million JPY a year. Convenience store workers
here make around 950 yen/hr depending on what shift you're working on.

Assuming you find somewhere super cheap and livable (we're talking slightly
larger than a single bed, maybe not even including a bathroom) for 50000
yen/mo, that's already 600,000 yen/yr on housing alone. You can see that
there's not much left over for utilities, food, transportation, clothes,
medical, etc... and we're not even talking taxes and luxuries.

------
terhechte
"The entire codebase was stored in a database, only accessible via a client
Mark maintained, with no version control nor lock controls meaning if we both
had a file open we could overwrite one another's files and undo work. There
was no pre-production environment. Meaning changes were supposedly deployed
untested or made straight on production. I was told I could not touch the
backend, although they were working on getting access to this via Mark.
Although it was taking time because Mark was more busy with his Bitcoin cafe.
They said that despite all this, it was still a decent place to work because
there was literally no pressure to perform. "

Just wow.

~~~
adamnemecek
The thing I don't get is why anyone would use their own 'code storage'. This
isn't laziness, it would take much less time to setup git.

~~~
q3k
I think it's a phase most programmers go through - I jokingly call it “code
graphomania”. You make up some sort of overengineered project, then keep
implementing it even though there might exist better alternatives. You'd
experiment with various language features, try to cram in some wild design
decisions that have no basis in real life patterns, etc. It's hard to explain
concisely, but I do observe this in other hackers a lot.

And I think Karpeles was going through that phase at this time. I vividly
remember seeing his blogposts on reimplementing an SSH server in PHP, just to
show that it's doable. I wouldn't be surprised to see that code and other
similar terribad ideas running in production.

~~~
Retric
I think a large part of this is the 1 Hour rule. Where when things are really
bad whatever you can do in 1 Hour that improve things slightly get done. Then
Repeat.

People basically just keep chasing local Optima until the unholy mess becomes
self-sustaining as real improvement becomes more difficult and you can always
look back and say, well at least we have "backups" even if it's just a copy on
another disk in the same machine.

------
mbell
For what it's worth, there doesn't appear to be any proof that this person is
whom they claim to be.

The question was asked but somewhat suspiciously dodged:
[https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_b...](https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_barr_aka_adam_turner_the_first_mtgox/ctnt9rs)

~~~
mintplant
/u/MtGox_Adam is the same reddit account as previously used by the Mt.Gox CEO.
Of course it's possible the account has been hacked.

------
sergiotapia
Interesting stuff. Sounds like a bunch of kids that had no idea how to handle
$500 million dollars. However, the owner did seem to handle things with
malice. Why would he share a bank account with all the customers assets - I'm
no lawyer but that sounds extremely ilegal and obviously a conscious choice.

You're given such a large opportunity and to piss it all away. Yikes.

------
joshstrange
There are other good summaries but here is mine, in no particular order (All
is C&P, no editing other than adding in my own commentary in "[]", putting
commenters questions in quotes, and adding in "Mark" where "he" and other
pronouns were used. Also "..." is a clip):

* As far as I know, no one else at Mt.Gox ever had access to the backend of Mt.Gox, nor the cold wallets. At my time there, only Mark had access to the Database. ... Mark said that if he died there would be hints that one of his best friends could follow to find and unlock the cold-wallets. When I asked said friend, he said he had no idea what Mark was talking about.

* We then looked at the expenses (eye-witness expenses only [AKA, we collaborated and make a list of things we had seen were purchased for the company] so it's not accurate, but surely less than what was actually spent), and used the trading data to calculate some averages around Mt.Gox's profits. The expenditures far exceeded every model we had for income. [This is in relation to the AMA'er being asked to be CEO of Mt. Gox and what happened when he tried to do due diligence, Mark wouldn't give him access to the books]

* Around the same time, we learned that Mark only had one bank account, shared with Mt.Gox's customer deposits.

* Mark was receiving a lot of pressure for "proof of solvency". I was behind him when he VNC'd into... somewhere, used the bitcoin otc app to send the money from A-to-B, and then posted about it. [In case you didn't catch that... THERE WAS NO COLD WALLET. ALL of it was hot and on a machine (running in graphical mode of all things...)]

* "How likely do You think it is that Mark Karpeles was running the Willy bot?" \-- To be honest, before you asked this question I had never considered it wasn't Mark. ... I just know my ex-employee contacted me about with the impression that Mark owned this account, I hadn't questioned it, and it was presented as "Mark is at it again"

* I think gross incompetence happened, and Mark tried to cover it up. I don't believe he is outright malicious, but certainly ignorantly-malicious.

* [Mark's] salary was the same as mine at that time. ... I started at 240000yen/month (~$3.1K/mo - ~$37K/yr), and was paid 320000yen/month (~$4.1K/mo - ~50K/yr) from about August 2011. I was the highest paid employee (including Mark) when I left the company.

* "Where do you think the millions of depositors fiat have gone to?" \-- Nooooooo fucking idea. I hope to read about it the same as you do. I want answers.

* "Why was Ross Ulbricht's Gox account banned very early on?" \-- Honestly, no idea. I know that Mark banned any accounts blatantly linked to SR. Some people emailed that they needed to use their undeposited cash to buy things on SR. If that made it to Mark, he banned it. I think it was safe practice.

* "Since this is AMA: How come you chose this particular time to come out with this AMA? Why now and not earlier?" \-- I think I mentioned in different comment threads, I had an NDA that prohibited me from talking about Mt.Gox. It's still enforceable, but I think Mark has other things to worry about at the moment... I hope :/

* I stopped believe anything he [Mark] said after a month of working there.

* "Reuters reported that expensive toys were being purchased by MtGox/Mark. Do you have any more examples of luxurious spending?" \-- He bout a NAO for $5k in August 2011, a Makerbot a little later, and... Ahem, I had to talk him down from buying a Lamborghini as his first car. Respectively, the Honda civic was a modest purchase. (how to fuck could I explain a Lamborghini to 50% of the employees making under $2000 a month... it would have killed moral, even moreso

* "I find it incredibly irresponsible that no employee or ex-employee blew the whistle on what was going on." \-- There was no proof, no one (mark) gave anyone access to anything directly. Everything was inferred. (Spent 900K, made x00K?) where did that come from? No answers... what can you report on that ... :/ It sucked....

* "Do you think Mark is guilty of actually manipulating data in a fraudulent manner, or merely negligence in operating MtGox?" \-- Both. but only the latter do I have an experience.

------
jellicle
"Around the same time, we learned that Mark only had one bank account, shared
with Mt.Gox's customer deposits."

------
mrebus
No offence to his guy but he seems woefully under qualified. A CEO that
doesn't have accounting report to him... makes less than 50K/year. Does anyone
know what valued he thought he brought to the table?

~~~
rmc
Mark, the founder, asked him to be CEO[1]. An incompetant current CEO, who
isn't giving details to someone who he asked to be CEO.

[1]:
[https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_b...](https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_barr_aka_adam_turner_the_first_mtgox/ctntusz)

------
dgfv1
[https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_b...](https://www.reddit.com/r/Bitcoin/comments/3fe92x/im_ashley_barr_aka_adam_turner_the_first_mtgox/ctnyhxb)

>The entire codebase was stored in a database, only accessible via a client
Mark maintained, with no version control nor lock controls meaning if we both
had a file open we could overwrite one another's files and undo work.

>>Like, PHP source stored in mysql tables?

>PHP, CSS, JavaScript, HTML. Errything.

>There was no pre-production environment. Meaning changes were supposedly
deployed untested or made straight on production.

>I was told I could not touch the backend, although they were working on
getting access to this via Mark.

WAT

------
brayton
What was the company culture like? We hear about a lot of bad but obviously
there had to be some good things going on to work there.

~~~
cma
This isn't the actual AMA, click the link at the top to get to it.

