Mtgox stops trading for 12 hours

https://bitcointalk.org/index.php?topic=173383.0

by gigavps • 13 years ago

96 101 13 years ago

Nursie8• 13 years ago

So what? Bitcoin's more than just a speculative.... pffft. Sorry, couldn't finish that with a straight face.

gigavps2• 13 years ago

I do believe that the bitcoin payment network adds a great deal of value. As for the price of bitcoin, it is still mostly driven by speculation.

As a business owner, there is nothing better than being able to transact with anyone, anywhere in the world instantly. You certainly can't do that with credit cards or paypal.

Nursie8• 13 years ago

I'm not sure it's such a great network, when you look at the ability of one service (SatoshiDice) to effectively overload it to the point some people started leaving their transactions out of their blockchain calculations.

As a consumer I also actually like the chargeback and other protections afforded to me by paypal and credit cards.

--edit-- I'll add that technically I think it's a fantastic achievement, and as an amateur crypto-geek it's fascinating. The people who came up with the scheme and have coded it have done a great job (though there are the aforementioned scalability problems), but I disagree with almost all the design decisions that went into the vision of the thing.

Cushman• 13 years ago

> As a business owner, there is nothing better than being able to transact with anyone, anywhere in the world instantly. You certainly can't do that with credit cards or paypal.

How about being able to transact with 99% of your customer base in a reliable, fraud-proof manner?

gergles• 13 years ago

You also can't "instantly" transact with Bitcoin, unless you're willing to risk a double-spend. You have to wait for confirmations through the blockchain which involve fees AND waiting (or really really long waiting) -- if you're going to pay a fee, why not just use the CC network and get it done instantly? At least when you get an auth from the CC network, you know you're guaranteed the money. When a transaction completes on the blockchain, it's still up in the air until the next block is produced by enough people.

jfoutz• 13 years ago

Pretty sure the intrinsic value is all the stuff you can buy on silk road.

ramchip• 13 years ago

Essentially the same comment is reposted in every bitcoin thread. It adds little to the discussion.

baddox• 13 years ago

If the price drops, you use that as clear evidence that your models are correct. If the price rises, well then that's clearly just temporary market irrationality, and it will eventually drop again.

Nursie8• 13 years ago

So far it seems to work that way, yes. And no, not because there's no way a prediction of that sort can fail. Slow, steady gains and a long plateau would disprove me. But this doesn't happen because BTC basically seems to suffer from massive hype cycles.

sks2• 13 years ago

Worst way to stop a crash.

lucaspiller2• 13 years ago

Best way to manipulate the market.

Heliosmaster• 13 years ago

well.. it's not unheard of: http://en.wikipedia.org/wiki/Trading_halt

fr0sty3• 13 years ago

That is only effective if you have all exchanges working in a coordinated fashion. Halting trading on a single exchange (even if it is the largest) does nothing to arrest the fall since trading can (and will) continue at other marketplaces.

sgwil• 13 years ago

Isn't it weird how whenever there's a massive selloff of Bitcoin, Mt. Gox 'experiences a DDoS attack' and closes trading???

dmm• 13 years ago

It's other people that have blamed this on a DDoS attack. MtGox themselves have explicitly denied it.

https://mtgox.com/press_release_20130411.html

""" First of all we would like to reassure you but no we were not last night victim of a DDoS but instead victim of our own success! """"

FireBeyond2• 13 years ago

Success for an exchange that makes money on trades whether the price is going up or down is a very different beast to success for someone losing half the value of their investment...

nlh• 13 years ago

As a curious but uninvolved Bitcoin observer, a question: Why haven't any alternate exchanges popped up? Seems that MtGox is still the go-to place to trade, and I keep hearing about their constantly being behind the 8 Ball when it comes to capacity, etc.

Or are there other exchanges out there and MtGox just gets all the press because they keep breaking :)

lucaspiller2• 13 years ago

MtGox was the one of (or the) first, but there are plenty of others. As I said in another thread earlier, Bitcoin24 [0] is a good, EUR focused, alternative.

[0] https://bitcoin-24.com/

ghshephard3• 13 years ago

https://www.cavirtex.com/home is another alternative.

"Cold Storage is the act of sending Bitcoins to an offline wallet address. Access to withdraw these funds must be by a human being and with a computer that is never plugged into the internet. This guarantees that a hacker cannot steal the wallet through the internet. This is done with transaction signing and USB keys to transfer the signed transaction from the offline computer to the online Bitcoin network. Over $500,000USD was stolen from the Exchanges Bitcoinica and Bitfloor by hackers because they did not use cold storage. VirtEx uses cold storage on approximately 80% of customer funds.

We keep the remaining 20% in a server ‘hot’ wallet to allow the small daily BTC withdrawal activity to be instant. If the amount of your withdrawal is too large, you will be required to wait for a human to perform a cold storage withdrawal of your funds. We have many different cold storage wallets and use multi-signature authentication so there is never just one person who can access cold storage and large amounts. You can even choose to place 100% of your funds in cold storage with us; however you will not be able to trade the funds unless you withdraw them from cold storage. This feature is coming soon."

StavrosK• 13 years ago

It's not an excange, but does anyone know how secure blockchain.info's wallets are? Everything I've read says they're very secure, but I haven't seen any unbiased experts say that...

Nursie8• 13 years ago

I'm another uninvolved observer, from what I've seen there are quite a number of other exchanges, many of them fail due to low volumes (and other reasons, some security related).

Whatever their relative strengths or weaknesses, Gox has captured most of the market, and is high enough volume to make it the most liquid and trusted exchange, so it's going to be hard to challenge.

deepblueocean• 13 years ago

This is a really interesting analysis of the risk of Bitcoin exchange failure, for what it's worth: http://fc13.ifca.ai/proc/1-2.pdf

smackfu• 13 years ago

This is kind of like asking, why didn't you switch away from them before they had these issues. Not much incentive.

IanCal• 13 years ago

There are others, btc-e is quite big. MtGox is just the largest, and was one of the first.

moondowner• 13 years ago

You can keep track of all markets (or the most popular, maybe there are more) on this page: http://bitcoinity.org/markets

Here you have: mtgox, btce, bitstamp, bitcoin24, bitfloor.

metachris• 13 years ago

Its important to note that right now the Mt. Gox prices (the default graph) are not representative, because trading there is suspended. This is the link to the bitcoin-24.com market: http://bitcoinity.org/markets/bitcoin24/USD

brianleb• 13 years ago

So, this is probably an ignorant question, but:

Is it possible to buy bitcoins on, say Bitstamp @ $85 and then turn around and immediately sell them on Bitfloor @$94? Surely not? What keeps one from doing that? Or does that generally happen until the markets even out?

Note: I don't own any bitcoins (I am averse to risk), just curious and interested and know nothing about ForEx

tlrobinson4• 13 years ago

Yes: BTC-e, Bitcoin-24, bitfloor, Bitstamp, CampBX, VirCurEx

But MtGox gets something like 80% of all trades.

tibbon• 13 years ago

I'm curious how one writes software to link in as an exchange. I haven't read the Bitcoin code throughly, but I'm not sure if I understand how to initiate a transaction with the network. Is there anywhere that documents it well?

narcissus• 13 years ago

The Bitcoin application / daemon can be controlled via RPC calls, so I presume that's how they do it.

tlrobinson4• 13 years ago

The usual method is interfacing with bitcoind via the JSON-RPC interface: https://en.bitcoin.it/wiki/API_reference_(JSON-RPC)

There's also bitcoinj: https://code.google.com/p/bitcoinj/

jscottmiller• 13 years ago

There are several other online exchanges [1], Mt. Gox just has the majority share by volume in several currency markets.

There are also many other informal exchanges, including in-person transactions and ebay.

[1] http://bitcoincharts.com/markets/

kmfrk• 13 years ago

Someone made the good point that this is probably in response to the precipitous drop, as Americans are getting up in the morning.

https://twitter.com/Brown_Moses/status/322351273045278720

tlrobinson4• 13 years ago

Bitcoin really needs a more distributed approach to exchanges. I don't know if that means a peer-to-peer exchange solution like Ripple, or just a loosely decentralized collection of exchanges.

A production quality open source exchange with focus on performance and security would be awesome.

tomp2• 13 years ago

The problem are not bitcoins. The problem are dollars and other fiat currencies. To be able to trade with those, you need to have them deposited in an exchange's account. That's going to be difficult to change.

craigyk2• 13 years ago

Lol, I had to get pretty far down this time to seen the first mention of 'fiat'.

leishulang2• 13 years ago

ripples are made by opencoin. opencoin are mtgox ppl. they will manipulate the market at their own interest, just like they did with BTc

ghshephard3• 13 years ago

I'm betting they are using this 48 hour window to upgrade their systems. The most important hint was this:

"Additionally trading fees will not be charged within 48 hours of trading resuming (until 2013-04-14 02:00am UTC)."

Seems like something they are offering to apologize for the inconvenience.

All told, between the 2 days of no trading, plus the 2 days of foregoing fee's, MtGox will forego over $250K of trading fees. That's a pretty big hit.

[Edit: Confirmed by MtGox themselves:]

-- snip --

Orders will not be accepted for the moment as we need to upgrade our database to accommodate the trading volume. However, you may still cancel your pending and open orders. Trading will resume at 11.00 am JST. Our apologies for the inconvenience caused and thank you for your patience while we work to resolve this issue.

]

[Edit #2 - I just realized, they are saying two, somewhat inconsistent messages.

Message 1: Trading is halted until 2013-04-12 02:00am UTC to allow the market to cooldown following the drop in price.

Message 2: Orders will not be accepted for the moment as we need to upgrade our database to accommodate the trading volume.

FireBeyond2• 13 years ago

Funny, that this didn't happen when Bitcoin was climbing into the stratosphere, but when it was crashing.

When your trading fees are a percentage of the value of the transaction, and you most likely have a large personal investment in Bitcoin, you have a -highly- vested interest in arresting a crash.

And yes, I know that MtGox is hardly the only place you can trade BitCoin, but it's definitely the largest.

dangrossman2• 13 years ago

MtGox's new signup rate has grown significantly in the past month. It went from hundreds to thousands to over 20,000 new traders yesterday. A crash coincides with high volume (1 hour+ trading lag) -- a perfectly technical reason to fix the issues now regardless of the finances. At some point they need to get the new infrastructure in place (see: http://coinlab.com).

ghshephard3• 13 years ago

I just transferred all my BitCoins to https://btc-e.com - for whatever reason, you are only allowed to withdraw 100 Bitcoins/24 hours. Probably a fraud insurance element - MtGox will cover any fraud, and they are limiting their losses to 100 Bitcoins at a time.

sks2• 13 years ago

I think the volume/unit time during the crash is generally higher than during the bubble phase. This can be seen in the steeper slope of price-time graph during declining phase compared to the rising phase of most bubbles. I guess fear is a quicker call to action than greed in financial markets.

powertower7• 13 years ago

Down to 90-110 USD on some exchanges!

tlrobinson4• 13 years ago

$60 on BTC-e

awnird• 13 years ago

Magic The Gathering Online Exchange

buro9• 13 years ago

It will be savaged when it comes back online, on some of the other exchanges bitcoin is down to $66 : https://btc-e.com/

gigavps2• 13 years ago

https://vircurex.com/ is also lower at $65 for bids.

powertower7• 13 years ago

I wonder how much of bitcoin's run-up has been due to fraud on MtGox where market manipulators make specific small up-tick buy/sell transactions - that are always moving the price up.

Now with MtGox out of the picture, the real demand and supply are meeting.

maxerickson2• 13 years ago

That only works if the honest participants are naively placing market orders and paying zero attention to volume.

A thinly traded market is at least a great place to try it.

davidmr• 13 years ago

This seems like a bit of a stretch to me, absent other information. Why do you suspect mtgox has been manipulating the exchange rate (or at least providing an exchange on which to do so).

SODaniel• 13 years ago

No doubt this is the REAL test of Bitcoin. I can see if hitting $30 again to bottom out.

tomp2• 13 years ago

The real price would probably be much higher right now, if people had the money. A lot of them have money deposited on MtGox, and they can't quickly transfer it to other exchanges, so there's a lot of BTC supply, but not a lot of USD supply (in forex, there's supply-supply, not demand-supply, if you can call BTC forex).

Nursie8• 13 years ago

It's bouncing around all over the place, between about $70 and $110, but then it seems to be one of the few exchanges still in operation - bitstamp seems to have disappeared off the net too.

eric970• 13 years ago

Has anybody seen their bulletins? Their first one advised people to go celebrate their "success" by drinking Champaign. Never mind that their exchange just lost ~half of its net value. Yuck!

jeremyjh• 13 years ago

Awesome. I'm buying back in at $8.

RutZap• 13 years ago

Hopefully this will move some of the trade volume on other markets. Having most of the trade of a decentralised currency on one market is not a good idea, and I see it as something that goes against the idea of decentralisation.

secalex• 13 years ago

At least tulips had some innate utility.

iso8859-1• 13 years ago

Which is?

emillerm• 13 years ago

You can use them to decorate the memorial for your life savings :)

Nursie8• 13 years ago

in an emergency you can eat them?

http://community.seattletimes.nwsource.com/archive/?date=199...

agilescale• 13 years ago

They are pretty.

kaoD4• 13 years ago

They're physical. You can wipe your ass with tulips but Bitcoin can't help you there.

waterlesscloud2• 13 years ago

Well, I guess that answers the question about Bitcoin, whether it will be the dominant cryptocurrency. The answer is no.

So now the question is, how long until an acceptable cryptocurrency comes along? And what does version 2.0 look like?

kaoD4• 13 years ago

I don't know how it'll look like, but I know how it will NOT look like.

It will not look like a currency tied to an exchange run by amateurs.

blhack• 13 years ago

How long do you get to keep calling them amateurs? They are running an exchange that deals with millions of dollars of money, and people continue to use them.

They're not amateurs anymore.

antonb2011• 13 years ago

"The Next Cryptocurrecy" is correct and is the phrase that tells you everything you need to know. The proponents of Bitcoin try to pass it off as being "As Good as Gold". However, unlike gold, whose supply is limited on Earth, and cannot be expanded without radical measures (asteroid mining or nuclear fusion), you can make as many new cryptocurrencies as you want. I might also have a couple of hash functions up my sleeve, whose solutions are difficult to compute, and so are "limited" in supply. Limited, that is, until someone comes up with next ByteCoin, CryptoCoin, ScamCoin etc.

Additionally, a shallow market is always a perfect pump-and-dump opportunity. Say you have a stock (or Bitcoin) that only has a volume of $100,000 a day. Then, if you're a small hedge fund and have about $20,000,000 devoted to small cap growth, or emerging market currencies, and your investment mandate allows you a temporary tactical deviation, you can buy the WHOLE supply of an asset for several WEEKS sending the price through the roof. When the crowd catches on and starts pumping money into your asset you exit the market and allow it to crash. Is it legal? No. Does it happen all the time? YES!

Drakim• 13 years ago

While what you say is true, it's also possible to arbitrarily declare another metal "the new gold" just like it's possible to make a new cryptocurrency.

codeulike• 13 years ago

A currency needs a community. Bitcoin has a community. Anyone that 'makes as many new crypocurrencies as they want' will quickly find they dont have a community.

Mtgox stops trading for 12 hours

Related Stories