crime

MtGox CEO heads to trial in Japan over missing Bitcoins

32 Comments
By Miwa SUZUKI

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32 Comments
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You have been scammed...

6 ( +6 / -0 )

He needs to see the inside of a jail for a while.

8 ( +8 / -0 )

It was made very clear by financial institutions from the outset of Bitcoin that there was no security or backing. And now, some years later, the CEO has pilfered nearly half a billion bucks. Why are people surprised?

1 ( +3 / -2 )

Bitcoin has suffered hacking incidents including one last year in which a major Hong Kong-based exchange Bitfinex suspended trading after $65 million in the virtual unit was stolen.

This is incorrect. Bitcoin has never been hacked. Bitcoin exchanges, of which Bitfinex and Mt. Gox are included, have been hacked. These are exchanges that interact with Bitcoin, they are not bitcoin itself.

This is like saying that if a bank gets robbed, the currency the bank works with can be counterfeited without detection. That's fundamentally incorrect. The currency stands on its own strength, and the bank being robbed does not affect that one way or the other.

5 ( +6 / -1 )

This happened 3 years ago, people are not surprised now. Also, this had nothing to do with the security of bitcoin itself, which is decentralized and secured by code. No trust is necessary. Unfortunately, people kept their decentralized coins on a centralized exchange, and trusted the guy in the picture.

This though has led to Japan putting into place some good laws requiring exchanges to have certain security protocols, as well as insurance.

That said, though, there is no reason to keep large amounts of bitcoin on any exchange for any length of time. It can be kept at home on a hard drive, in decentralized and encrypted cloud storage, or even on a piece of paper.

Nobody should completely trust financial institutions, and that includes banks. Of course they criticize bitcoin, because it will put them out of business eventually.

4 ( +5 / -1 )

It was made very clear by financial institutions from the outset of Bitcoin that there was no security or backing. And now, some years later, the CEO has pilfered nearly half a billion bucks.

There is no CEO of bitcoin, so your statement doesn't make sense.

5 ( +5 / -0 )

Funny that the headline omits the the person in question is the "former" CEO.

It's a good thing (for him, not for us) he is being tried in Japan, where executives of any kind usually get a slap on the wrist. As a foreigner, and not a Japan Inc executive, his punishment will be more harsh, but not truly harsh. Had he pulled this stunt in America he would likely spend the rest of his days in jail.

In itself, bitcoin is seen as safer and more valuable than nationally-issued currencies, which are manipulated and abused at will by politicians and central bankers to buy votes. This is why bitcoins continue to trade for ever higher values. As of today, one bitcoin is work nearly 290,000 Japanese yen, more than ten times it's value when the Mt Gox story broke.

1 ( +2 / -1 )

Surprising how many people still fundamentally misunderstand what bitcoin is. That's why I think talk of a bubble is premature. But then, most people fundamentally misunderstand how fiat currencies work as well, and they have had a good run.

-2 ( +1 / -3 )

But then, most people fundamentally misunderstand how fiat currencies work as well

That's what it comes down to. These people don't realize that fundamentally there is really no difference between bitcoin and a currency backed by a nation or group of nations. Both only have the value that people attribute to the currency, based on the people's belief in the strength of the currency.

0 ( +1 / -1 )

Nice we can agree on something:)

Human nature that people resist change, and are biased toward believing that was is will always be.

1 ( +2 / -1 )

If no regulatory or legal framework exists. underpinned by central bank governance or authority the risk strategy is oblivious if nonexistent.  

Crypto/digital/virtual currency are at the mercy of peer to peer transactions utilising encrypted protocol algorithm software. All essential to secure an exchange platform network that maintains the integrity, rigidity of that algorithm model and its code that releases/creates/mines the coins. This could well become a mainstream adoption standard of trading However like every currency transaction, there needs to be a recording in a ledger (Blockchain) held by every currency holder, updated instantaneously.

Beware for some investors, It's the wild west meets the mad hatters tea party and is viewed as inherently venerable to every shade of hacker, villain and fraudster without have to leave the comfort of their bedroom ............or require the services of a getaway driver.

1 ( +1 / -0 )

Nice we can agree on something:)

Other than political stuff, I find that you and I are generally on the same page for things.

0 ( +0 / -0 )

This is a rather informative overview from the European central back , 2012, so a tad dated....But worth a browse all the same. Scroll down to 3 and 'case stories'...Bitcoin is there

https://www.ecb.europa.eu/pub/pdf/other/virtualcurrencyschemes201210en.pdf

0 ( +0 / -0 )

as with keeping cash at banks and securities with brokers, I suggest (if it does not already exist) some type of insurance system for this type of event.

I am not convinced of his guilt, and rather expect he was incompetent or unaware of what was happening.

1 ( +1 / -0 )

These people don't realize that fundamentally there is really no difference between bitcoin and a currency backed by a nation or group of nations.

There is a very fundamental difference, and that is supply. The supply of bitcoins is limited to 21 million units. The number cannot be changed to manipulate bitcoin values. Nations switched from money to currency because the supply of money tended to be fixed, which limited their ability to spend. No politician wants to be restricted to spending less money than the people have. Using currency instead of money allows them to spend almost without limit. The only limits imposed are the bond yields which are decided by the market. But as western countries have taken to the practice of borrowing money by selling bonds to themselves at rates below what the market would charge, politicians can spend even more. If this practice continues, people may very well lose faith in their national currencies, and their value may indeed vanish.

It is for these reasons that the bitcoin was created, and why it is in demand. Gold has value because it is scarce, and it's supply is limited; the entire world's supply would fit into an Olympic-swimming pool. But bitcoins are easier to trade and transport than gold.

0 ( +2 / -2 )

Found a update 2015 on the ECB database....

https://www.ecb.europa.eu/pub/pdf/other/virtualcurrencyschemesen.pdf

0 ( +0 / -0 )

bitcoin hahahahah

-3 ( +1 / -4 )

I do not accept bitcoin or any other currency not backed up by a government. The risk of being scammed is too great and there is no legal recourse if you lose all of your money.

0 ( +3 / -3 )

bitcoin hahahahah

People who don't understand bitcoin and just laugh at it hahahahahahahaha

2 ( +4 / -2 )

Do Tokyo prostitutes take Bitcoin....just wondering...,

1 ( +2 / -1 )

Lot of ignorance surrounding bitcoin. Old people who want "government security" - whatever that means - look at Europe. And lazy young people who can't stop looking at porn long enough to research and learn about what bitcoin is and why it's a stupid thing to use as an investment vehicle.

The whole reason bitcoin was made was so that it could be used as a currency. As a currency it works quite well. When people who don't know how to use it start buying it in huge quantities, problems crop up, but I'm sorry to say, it's their own fault if their money disappears. As mentioned, cryptocurrencies do not need to be stored online and should not be, yet people who don't know what they're doing continue to do this.

1 ( +2 / -1 )

As mentioned, cryptocurrencies do not need to be stored online and should not be

Well, the currency itself is part of the blockchain, which is everywhere.

What are referring to is the key (think password) to access the currency.

1 ( +1 / -0 )

99% conviction rate gonna kick your ass, thanks for stealing our bitcoin, idiot, I hope you rot in jail you scammer.

1 ( +1 / -0 )

Look, it's not rocket science: 

Cryptocurrencies don't expand the monetary base in response to increased usage: if demand for a cryptocurrency grows but supply is limited, its price will increase. That makes cryptocurrencies deflationary and accordingly, it creates an incentive to hoard, not to spend (why buy something today, when you can buy twice as much of it tomorrow for the same price?). The obligate consequence is speculatory bubble cycles. That's all there is.

0 ( +1 / -1 )

What are referring to is the key (think password) to access the currency.

Yes, but what I am referring to is people putting their passwords online for example in their email accounts, or sending them in plaintext. There are people out there running TOR exit nodes that just sniff all the exit traffic looking for unencrypted bitcoin passwords.

The idiocy surrounding bitcoin usage is staggering - from the insane speculation reminiscent of the gold bubble a few years ago, to the complete lack of understanding of how bitcoin actually comes to be.

When I tell opinionated Japanese people that I create bitcoins using my computer's graphics cards, they always shoot back - "You'll be arrested!".

The public needs more education about this kind of issue, not more education about why we need article 9 changes crammed down our throats.

-2 ( +0 / -2 )

Hi, Strangerland, Blockchain ledger of transactions is the key, this theoretical concept can change the system of monetary boarders and possibly the economics of government.  

How this evolves is where the theory ends and politics begins, control of the monetary supply.  MtGox and the hapless Mark Karpeles, even Bitcoin are conveniently inculpate, at least momentarily.

Blockchain could prove to have, monetarily, economically the same significance as to the invention of the wheel to transportation. Even in my late twenties, It many not be in my lifetime though

0 ( +0 / -0 )

Oh, I'm very older and ignorant man. But I rather de gold value. On dar case, I can to bury it...

0 ( +1 / -1 )

I want to say "war" not dar

0 ( +0 / -0 )

@Felix Lorenzo Martin Moro: instead of gold I think pound for pound you are better off with diamonds. Swallow a couple and on your way. Gold is very very heavy, and you may not find it after you bury it.

-1 ( +0 / -1 )

He looks like a trustworthy character.

My guess no-one gets anything out of this except he gets a long stretch (but shorter than negligently killing someone, for example).

-1 ( +0 / -1 )

paradoxbox, I cling to my gold, silver, dollars and yen. I see no reason to risk my reserves to greedy people in search of quick profit. I see bitcoin mostly useful when people want their transactions shielded from government oversight. In other words criminal activity.

-4 ( +0 / -4 )

All Digital Currencies (Cryptocurrencies​) should be declared illegal and trading with Digital Currencies was crime. Around 90% transactions with digital currencies are involving in illegal trades. Government needs to declare illegal and crack down illegal trade transaction with digital currency.

-3 ( +0 / -3 )

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