One of the heavy topics of debate, which has been going on for years now, is whether or not Bitcoin is ready for mainstream consumption. Despite the increase in venture capitalist funds in both 2014 and 2015, the overall performance of this disruptive virtual currency has been rather lackluster. Or that is what the everyday consumer seems to think, even though that vision is not shared by everyone.
The Bitcoin situation in Tokyo could very well shape the future of virtual currencies in Japan. Two weeks ago, the Tokyo District Court judged that Bitcoin are not subject to ownership. With the Mt. Gox investigation looming overhead, plenty of affected users were hoping to see a different outcome so they could recoup some of their losses. However, there are some vital points to be made regarding this judgement.
Once the mainstream media picked up the news about the arrest of former Mt. Gox CEO Mark Karpeles, it was only a matter of time until the Japanese got involved with Bitcoin more strictly. If there is one thing Mt. Gox has taught us, it is that regulation up to a certain extent is needed, even though a lot of people perceive it as a “necessary evil”.
Mt. Gox Arrest Putting Things To Rest Once and For All
The arrest of former Mt. Gox CEO Mark Karpeles is a godsend for the Bitcoin community and affected users of the Bitcoin exchange’s collapse. After more than a year of fleeing from the policy and impending justice, Mr. Karpeles has finally been arrested and is currently awaiting trial for his past transgressions.
Tibanne Co., Ltd, the parent company of the infamous MtGox, Co, Ltd, is subject of an application to commence bankruptcy proceedings for their company. This is great news for everyone who was a victim of the Mt. Gox “collapse”, as things finally seem to be moving ahead in order to come to a conclusion. Bitcoin users will hopefully be able to leave this debacle behind them sooner rather than later.
Many Bitcoin enthusiasts around the world have been waiting for the parent company of Mt. Gox to be declared bankrupt, in order to continue with the proceedings in court. Earlier today, a PDF showed up on the Mt. Gox website, signed by Nobuaki Kobayashi, Attorney-at-law and Bankruptcy Trustee of Mt. Gox.
Yesterday, both Serge and myself attended the General Assembly of the Belgian Bitcoin Association. As both of us are new members,we are able to attend these kind of meetups. However, since neither of us have been a member for more than 6 months, we do not have any official voting rights. Let’s see how the year 2014 has been for the Belgian Bitcoin Association (BBA).
Belgian Bitcoin Association : 2014 Timeline
Bitcoin did not make such a great start in 2015 as some of us might have hoped. Bitcoin wasn’t doing so hot at the end of 2014 and to date in 2015 , it got worse after Bitstamp, one of the major exchanges out there, announced that their hot wallet was hacked. According to the latest reports Bitstamp lost around US$5 million, which is around 18,668 BTC.
Due to all of the negativity surrounding Bitcoin exchanges over the past few days, other exchange platforms are doing their best to reassure customers regarding the safety of their funds. Huobi, one of the biggest Chinese Bitcoin exchanges, have issued an official statement regarding how they handle security in light of the Bitstamp incident.
“Huobi (including BitYes and BitVC, which are separate platforms operated by the same security team and wallet system) follows the common industry practice of keeping the vast majority of its users’ coins in secure cold storage. For the operational hot wallet, which is used for processing user deposits and withdrawals, Huobi has independently developed its own three-tier security system which includes multi-signature addresses and real-time monitoring and anomaly detection mechanisms.”
We have received reports claiming Bitstamp LTD, one of the most popular Bitcoin exchanges to date, may have been breached. As a result of this breach, customers are advised not to send any funds to Bitstamp hot wallets, and customer details may have been compromised as well. Up until now, we do not know the extent of this potential breach, but here is what we do know.
SECOND UPDATE : The Bitstamp main page now looks like this :
For many Bitcoin enthusiasts, 2014 has revolved around the Mt.Gox drama that surround the beloved digital currency, and remains on the key references when explaining Bitcoin to novice users. I for one, hope to never mention Mt. Gox in face-to-face conversations again in 2015. Unfortunately, that is as likely to happen as me winning the lottery. We might as well get the Mt. Gox news out of the way on the first day of 2015, shall we?
It’s still not clear what happened to the 850,000 Bitcoins that were lost by the Tokyo-based Mt.Gox, once the biggest Bitcoin exchange market in the world before it collapsed in bankruptcy this year. But we might find out in the near future.
The San Francisco based Bitcoin exchange “KRAKEN” has decided to help with the search for the missing Bitcoins, along with eventually redistributing anything they can retrieve to creditors as part of a liquidation.
Kraken CEO Jesse Powell: “We will use our resources and expertise to minimize the damage to the creditors and restore confidence in the Bitcoin community.”
Tibanne KK, the parent company of the now-bankrupt Japan-based Bitcoin exchange Mt. Gox, is currently searching for investors to buy the company’s trademark rights to the word “Bitcoin”. According to Tibanne KK, they acquired the trademark in 2011 and the rights to associated protections are not set to expire until 2021 in the EU and in 2022 in Japan.
Tibanne is also selling its Bitcoin-related domain names in a package it hopes will net at least 1 million dollars so they repay creditors. An executive from Tibanne told that the company simply wasn’t using the domains anymore, mainly because the the Mt. Gox debacle.
It seems that the Mt. Gox soap is nearly over. The US lawyer representing the country’s domestic exchange users, Jay Edelson, indicated that the plan was approved in a Northern District of Illinois court.
This gives a legal backbone to the claims that have been put forth by the clients that have suffered due to Mt. Gox. This ruling gives more weight and will probably be formally accepted in Japan.
According to Edelson: “The court granted our motion for preliminary approval of settlement and other proposals. We will now take it to Japan and seek approval from the Japanese Administrator.”
The recent debacles with some of the crypto currency exchanges have most people on edge. One of the most prominent of all the exchanges “fail” is Mt.Gox. Yes they have claimed “they didn’t know of the problems“ and “they were hacked’. Some people who have lost a lot have filed claims against Mt Gox . Through certain interviews and court related press releases it appears that the CEO, mark Karpeles, knows a lot more than he is admitting. If you are innocent and really didn’t know about theft and hacks, why hide and lie at lawsuit hearings and to the community?
The soap opera around Mt. Gox is steadily growing and some disturbing accusations are “hittng the fan” so to speak. According to new testimonies by employees the CEO of MtGox allegedly spent money from its clients’ deposits on operating expenses and wild parties and luxurious items as early as two years before the problems began. For example: their rent in the same high-status Tokyo office building as Hulu and Google, office equipment that included a robot and a 3D printer, a special edition Honda Civic imported from the UK for Karpeles etc. On a personal note I wonder why someone would import a Honda Civic. They are made in Japan and since you live and work in Japan why not just .. I don’t know LEASE a car from Japan? That just seems a deliberate waste of money.
Vircurex has frozen most of its digital currency withdrawals effective immediately. Vicurex is claiming it no longer has the reserves to cover customer requests. According to our information, this will affect all Bitcoin, Litecoin, Feathercoin and Terracoin withdrawals. According to a message from Vircurex that is posted on their website, they claim this move was necessary and that it “will create a new balance type called ‘Frozen Funds’ “covering all balances in the affected currencies. The company maintains it won’t be shutting down, saying it intends to “gradually pay back the losses”.
The fact that Vircurex had a reserve shortfall has been known for some time; however the exact amount was never mentioned. It froze BTC/LTC withdrawals in January 2013 after reporting that wallets had been compromised, but still allowed deposits in those currencies to continue.
The “news” that Mt.Gox is spewing out into the world is getting scrutinized by many. Bankrupt Japan-based Bitcoin exchange Mt. Gox released a new press statement earlier today confirming 20th March reports that it had uncovered an ‘old-format’ Bitcoin wallet containing some 200,000 Bitcoins presumed lost in the run-up to its insolvency. It would be around the 110 million dollars mark. More and more people are beginning to see how those claims are just ludicrous.
The soap opera continues around Mt. Gox. After numerous people question the actions of Mt.Gox, some even went for lawsuits against Mt.Gox, there is more news coming in of irregularities at Mt.Gox. First there was the fact that Mt Gox let trading in Bitcoin continue but with no withdrawal possibility. Second there was information leaked that the CEO of Mt. Gox did know beforehand that there were huge problems with the site but did nothing/not enough to prevent the problems or worked on any meaningful solutions. Third Mt.Gox blatantly lied to their traders and customers about the severity of the problems. Now Mt. Gox comes on the scenes with a statement that “they have found 200 000 bitcoins in old wallets”.
The Mt.Gox soap opera continues.The soap opera around Mt. Gox just doesn’t seem to stop. The once popular Crypto exchange is filing for bankruptcy in Japan and the United States. When taking a closer look at the U.S. filing, it seems that Mt. Gox may have collected a large sum in trading fees in the weeks before the website was shut down. All of this was done while it was fully aware that a large number of Bitcoins had gone missing and that there were problems on the horizon.
· To read or not to read the signs… that is a serious question.
In the last few weeks Bitcoin got bashed left and right by people because of the Mtgox debacle. “Bitcoin will be dead in a few weeks” or “Bitcoin is a scam” are the favorite pastime of the lobbying pro bank individuals. However if you are looking for real evidence or some witty discussions with these “naysayers”, you will be very disappointed.
It’s been a wild ride for all Bitcoin enthusiasts over the past 48 hours. From prices bottoming out, to a lot of unclear information regarding Mt Gox, and yet somehow, Bitcoin has once again recovered.
I’ve heard a lot of doom scenarios regarding Bitcoin lately. Statements such as “This is the end of Bitcoin” , “Bitcoins were stupid to begin with, get a real job and earn real money” , and even “Cryptocurrency should be outlawed worldwide”.
As you can imagine, most of it came from people who were misinformed, jumped to conclusion, or people who just have no clue what on earth they’re talking about. There are plenty of those around anyway.