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Bitcoin Exchange Mt. Gox Halts USD Withdrawals
hypnosec writes "World's largest Bitcoin exchange, Mt. Gox, has halted U.S. dollar withdrawals of customer funds in the U.S., citing a need for system improvements. According to Mt. Gox, the exchange has experienced a huge number of requests for deposits as well as withdrawals from both established markets and new markets, following which its bank hasn't been able to process transactions on time. This led to difficulties for its overseas clients, especially those in the U.S. The exchange said that the deposits in USD, transfers to Mt. Gox, and deposits and withdrawals in other currencies will remain unaffected during this period. Mt. Gox will be resuming the USD withdrawals for its U.S. clients once the improvement of its systems is complete."
Wired suggests the slowness may be due in part to reluctance from banks to get entwined with Bitcoin for a number of reasons. "The problem is that U.S. banks are afraid that doing business with Bitcoin companies might draw the attention of U.S. or state regulators ... This reluctance may be fed by the sense that Bitcoin poses a threat to the banking industry. Anyone can transfer Bitcoins anywhere for free and that could put a dent in some banking transaction processing fees."
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You seem to believe the banking industry is over-regulated.
Slashdot: providing anti-social weirdos a soapbox, since 1997.
holy fuck. you realize that transferring trillions of dollars to millions of people, requires a shit ton of people to do stuff?
yes the system is corrupt - bitcoin would take that corruption to the maximum level.
That's a typical Mt. Gox excuse. "We're going to hold onto your money for some vague amount of time for some vague reason." Note that they're only stopping withdrawals from Mt. Gox, not inbound transfers. That's very suspicious. If they'd lost their banking relationship for wire transfers, they couldn't do inbound transfers either.
I've mentioned before that Mt. Gox's withdrawal limits are suspicious. They should be able to pay out 100% of funds they hold on short notice. They're not a bank, and are required by the Payment Services Act of Japan to have 100% of the assets entrusted to them. Even more suspicious is that as Bitcoin has grown, Mt. Gox withdrawal limits have become smaller.
If you have assets in Mt. Gox, get them out now. There are too many red flags about that business.
I've heard this line of BS many times and it amazes me how many people buy into it.
It's a nice line that anti-government types like to pull out, and the only problem is that it ignores reality and gets it backwards. Banks basically paid off, through lobbying and "donations", both legal and illegal ones, enough members of Congress to get regulations RELAXED - as in, the law signed in 2000 that made Wall Street exempt from the "bucket shop" restriction. Great idea! Except that it was the biggest contributing factor to sinking the economy. The bad loans themselves, if that were all that were being defaulted on, were a tiny fraction of a percent of our GDP. The bad bets MADE on the loans, however, compounded the problem by orders of magnitude.
In other words, even if your claim of government forcing banks to loan more money were true (it's debatable, and if you read enough about it it's clear that the banks weren't being forced to do anything they didn't want to do) - it STILL didn't sink the economy. Deregulation, of one specific type, did.
I've learned that they're worthless, so I don't read AC comments anymore.
Have the courage to speak for yourself and only yourself. Everybody here wants you to do that.
- First they ignore you, then they laugh at you, then ???, then profit.
Do you know the definition of Ponzi scheme? Because I don't think that term means what you think it means.
Bitcoin is many things, but it is as much of a Ponzi scheme as gold, real estate, or stock speculations. ie. not a Ponzi scheme at all.
While one can argue that Bitcoin is a scam (and most definitely a bubble), it does not fit the formal definition of a ponzi scheme.
http://www.sec.gov/answers/ponzi.htm
>>A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity.
The key point here is the "solicit new investors by promising to invest funds in opportunities claimed to generate high returns" section. In a normal Ponzi Scheme, the previous investors would attempt to guarantee newcomers that profit is certain.
In comparison, Bitcoin promises no such thing. While it is true that the profit of previous investors (or speculators) do indeed come from newcomers, the newcomers are not promised anything beyond their belief that the price will continue to rise.
This key difference makes the Bitcoin phenomenal a 'Bubble', not a 'Ponzi Scheme'.
It would be nice if that were the truth. Yes, the Bush administration made it a priority to get people into homes.
The mortgage brokers cheated lenders with subprime mortgages. They got their commissions and people lost the houses they couldn't afford in the first place.
The lenders then sold bad loans to investors like Goldman Sachs.
When the bottom finally fell out, two financial instruments companies went down. The rest got their money back from the government.
To explain exactly how much cheating was going on, the utter trash that GS knew was trash, they sold to investors. They also took out insurance policies on it.
Then AIG collapsed because of those policies and the government paid their policies. GS took that money and used it to buy securities.
So, GS engaged in quasi-criminal behavior and fraud. They bought, packaged, and sold turds. Took out turd insurance and then used the insurance to buy money.
In case some can't follow along, the took the government bailout and loaned it back to the government with interest.
So, no, the crash of 2008 wasn't due to regulation, it was due to fraud. And no one went to jail.
They're using their grammar skills there.
The steady erosion of Glass-Steagal through the 20th century, culminating in the 1999 GLBA which repealed sections 20 and 32 certainly had a big part to play in this. Without that, the interdependence effect we saw would likely not have occurred to the same degree.
The fact is, a lot of people in finance aren't bright enough - or cautious enough - to understand or care exactly what risks they're taking, especially with other people's money. To use an old analogy, the modern financial system is like the ferry service in an impoverished coastal country. Everyone uses it, because it kind of works. It's overcrowded, run by greedy people cutting corners, and every once in a while a ferry sinks, killing somewhere between 800 and 1000 people. But the next day, the rest of the identical ferries are out, and people are lining up to get on board because they don't have a choice.
At least after the S&L debacle, people got prosecuted. This time, they were let off the hook.