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MtGox Finds 200,000 Bitcoins In Old Wallet

thesandbender writes: "Today brings news that MtGox has 'found' 200,000 Bitcoins in a 'forgotten' wallet that they thought was empty (PDF). The value of the coins is estimated to be $116 million USD, which happens to cover their $64 million USD in outstanding debts nicely and might offer them the chance to emerge from bankruptcy. There is no explanation yet of why the sneaky thieves that 'stole' the bitcoins used a MtGox wallet to hide them."

60 of 227 comments (clear)

  1. Smelling more fishy every day. by RobertM1968 · · Score: 5, Insightful

    It's amazing how they "found" these... I would have thought that computers would make it impossible to "lose" such funds - even with the most simplistic of accounting programs. The more I hear, the more it sounds like something else is going on (like the principles of Mt Gox trying to run off with as many BitCoins as they can). It's like watching a soap opera.

    1. Re:Smelling more fishy every day. by B33rNinj4 · · Score: 5, Funny

      All we need is for MtGox to "disappear" after a tragic fall off a sailboat...only to return with amnesia later on...and begin a romantic relationship with his nighbor who actually turns out to be his unknown sister.

    2. Re:Smelling more fishy every day. by mysidia · · Score: 4, Interesting

      Probably... they were 'magically discovered' when it became clear to Mark that the authorities might be contemplating criminal charges against him.

    3. Re:Smelling more fishy every day. by Megane · · Score: 3, Interesting

      I would have thought that computers would make it impossible to "lose" such funds

      Except that computers make it possible for idiots to screw up even worse than ever before. And given that the guy apparently cared more about opening a bitcoin restaurant than, say, using a programming language that wasn't crap COUGHPHPCOUGH, I'm just barely willing to believe they lost it. I'm really more surprised that they found that wallet before it got thrown out on a junked hard drive.

      Sure, it's a bit too convenient, especially after all the rumors of hacks that let people double-dip when withdrawing bitcoins, but it's not impossible that they came from a different source. So just how easy is it to look up the transaction records for 200,000 bitcoins, anyhow?

      --
      #naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
    4. Re:Smelling more fishy every day. by BitZtream · · Score: 2

      Pardon the ignorance, what are you referencing?

      --
      Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
    5. Re:Smelling more fishy every day. by Anonymous Coward · · Score: 5, Funny

      It's autobiographical.

    6. Re:Smelling more fishy every day. by hawkinspeter · · Score: 5, Funny
      --
      You're a temporary arrangement of matter sliding towards oblivion in a cold, uncaring universe
    7. Re:Smelling more fishy every day. by AmiMoJo · · Score: 2

      A Bitcoin wallet is just a text file. They moved it to offline storage to protect it from hacking. They had it in their accounting software, that's how they knew it was missing.

      Man, I wish I could find $116m in an old wallet.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    8. Re:Smelling more fishy every day. by invictusvoyd · · Score: 2

      It's like watching a soap opera.

      Its like watching a very dumb version of Monty python .. really ..

      _____
      This !! aint fishy . This is "sea food platter"

    9. Re:Smelling more fishy every day. by BlackPignouf · · Score: 2

      Exactly.
      - Sorry, we lost $1B
      - But, you owe us $50M
      - What a coincidence! I just found $100M. But I promise you, I don't know where the other $900M are.

    10. Re:Smelling more fishy every day. by Marxist+Hacker+42 · · Score: 4, Funny

      Every single soap opera ever written.

      --
      SJW: a person who perceives an injustice, and while correcting it, commits a greater injustice.
    11. Re:Smelling more fishy every day. by Joce640k · · Score: 3, Funny

      Aka: "Never attribute to malice that which be adequately explained by stupidity".

      --
      No sig today...
    12. Re:Smelling more fishy every day. by Marginal+Coward · · Score: 5, Funny

      Darn, I thought it was as an episode of "Arrested Development" I hadn't seen yet. Maebe not.

    13. Re:Smelling more fishy every day. by Mr0bvious · · Score: 5, Funny

      No, no, popular cultures also grow in basements..

      --
      Never happened. True story.
    14. Re:Smelling more fishy every day. by beelsebob · · Score: 3, Interesting

      He's referencing a couple that did exactly this in the UK a couple of years ago.

    15. Re:Smelling more fishy every day. by Richard_at_work · · Score: 5, Interesting

      The first half is strikingly close to what happened recently in the UK - John Darwin went missing while canoeing in the North Sea during 2002. His canoe was found, but his body was never recovered and he was declared dead in 2003.

      In 2007 he returned to life, having lived in the intermediate years as John Jones, firstly in the UK (living in a bedsit next door to his old home, then living with his supposed widow wife, before they moved overseas, eventually ending up in Panama. The catalyst for his return was a change in Panamanian visa law, which required British police confirmation of his identity.

      So he came back to the UK, claimed he had amnesia and didn't know what had happened after his disappearance, and his widow wife and children played their part in the fantastic return - but it soon all unravelled when it was discovered that his wife knew all along and had lived with him in Panama for several years.

      They are both now serving jail sentences for insurance fraud.

    16. Re:Smelling more fishy every day. by Richard_at_work · · Score: 3, Informative

      Also, he may be referencing Robert Maxwell, who disappeared from his boat while sailing off the Canary Islands, but his body was actually recovered a while after and positively identified - but his disappearance at the time was widely believed to be a deliberate act to avoid being prosecuted for discrepancies in his companies pension funds.

    17. Re:Smelling more fishy every day. by Michalson · · Score: 5, Informative

      While the MtGox situation is very, very suspicious the way Bitcoin works it makes the stealing and 'finding' of bitcoins very strange compared to traditional currency. Imagine a dollar bill. Much like a Bitcoin it has a unique serial number at the bottom. You can deposit it in a bank where they will keep a ledger so they know how much money anyone can withdraw from the teller while keeping most of it in the vault. If the vault is robbed it will quickly be discovered when they open it up in the morning and find it empty.

      But Bitcoin differs in that last part. When you spend or transfer a bitcoin you aren't handing over the original, you're making a copy and the person receiving it is adding an extra digit to the serial number. Even though you still have it your copy of the coin is no longer legal tender and if you go to a store and try to spend it the cashier will tell you the serial number is too short and someone else owns the legitimate digital copy of that coin. If a thief gets into the bitcoin vault he doesn't need to remove or change anything, he just copies all the serial numbers and immediately 'pays' it into wallets he owns or controls, making his copy the legitimate article and the coins in the vault useless bits of data. The owners of the vault don't know this - the contents of the vault have not been changed in any way and it's only when they remove some of the money from the vault and try to spend it that they'll discover they've got worthless old copies.

      While less likely it is also possible, with ledgers being moved around and even manipulated by thieves, that bitcoins that where assumed withdrawn are in fact still legal tender - if the bank made a copy of a one of their coins to service an apparent withdrawal, but that copy was never 'spent' then the original is still good. This is one of the difficulties of Bitcoin, unlike physical currency or even centrally managed digital currency (what a lot of your money basically is) you can't determine if each coin is worth something or just a bunch of worthless numbers without asking for the opinion of a bunch of other people. The extra layer of security of a vault actually makes it harder, since you are trying to keep that data out of the wrong hands, not share it with others to get their daily opinion (imagine if a bank removed every bill from the vault daily to check them with those counterfeit pens - how many opportunities to steal the money would that add).

    18. Re:Smelling more fishy every day. by Richard_at_work · · Score: 5, Funny

      Sorry, I left a parentheses open in my last post and its bugging the hell out of me. So heres the closing one. )

      I apologise whole heartedly for all of the teeth-nashing this has caused.

    19. Re:Smelling more fishy every day. by Anonymous Coward · · Score: 5, Funny

      In that same spirit, here's the g you missed out of 'gnashing' ;)

      g

    20. Re:Smelling more fishy every day. by bill_mcgonigle · · Score: 2

      I would have thought that computers would make it impossible to "lose" such funds - even with the most simplistic of accounting programs.

      OK, look - for their infrastructure, they re-implemented ssh in php.

      If somebody wants to argue "plausible deniability", then fine, but it would require an assertion of supergenius levels of foresight, planning, and cunning.

      I lean more towards "you've got to be kidding me".

      --
      My God, it's Full of Source!
      OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
    21. Re:Smelling more fishy every day. by next_ghost · · Score: 2

      Mybitcoin.com copycat scam, right on schedule.

    22. Re:Smelling more fishy every day. by Tom · · Score: 3, Interesting

      I would have thought that computers would make it impossible to "lose" such funds - even with the most simplistic of accounting programs.

      ROTFL.

      The dark secret of business world-wide: It's all a hodgepodge of hacks and duct-tape. Large corporations regularily misplace money and assets, often in the millions. And yes, despite SOX and all that.

      Computers or not, large corporations are complex beasts, and all the accounting trickery they play for tax purposes doesn't exactly make it easy nor transparent, because it intentionally isn't. For a fast-growing company, most CFOs are pretty happy if their accounting isn't too far off.

      So yeah, losing a hundred million is a rare event, but it's impossible nor unheard of.

      --
      Assorted stuff I do sometimes: Lemuria.org
    23. Re:Smelling more fishy every day. by TWX · · Score: 2

      Heh. I'm reminded of The Big Bang Theory when Sheldon's MMO in-game crap was stolen by a hacker that happened to be local to them, and it finally took Penny to kick him in the balls while the four men looked on to get the stuff put back...

      So a cute blonde girl will show up and break Mt Gox's nuts until they scream, "uncle!"

      --
      Do not look into laser with remaining eye.
    24. Re:Smelling more fishy every day. by Hognoxious · · Score: 2

      Nothing to do with Reggie Perrin, then?

      --
      Confucius say, "Find worm in apple - bad. Find half a worm - worse."
    25. Re:Smelling more fishy every day. by Richard_at_work · · Score: 4, Informative

      Maxwell had lots of companies, several of which had irregularities.

      It helps to not be arrogant in your attempts to "correct" people.

      Learn this.

    26. Re:Smelling more fishy every day. by Comrade+Ogilvy · · Score: 2

      Also,if I understand it all correctly, in principle, it is possible to watch the block chain and observe your own coin has been "stolen", because the public keys used to validate are public. Whether that is practical I do not have any idea.

    27. Re:Smelling more fishy every day. by NotDrWho · · Score: 2

      Batley Townswomans Guild presents The Fall of MtGox....

      --
      SJW's don't eliminate discrimination. They just expropriate it for themselves.
    28. Re:Smelling more fishy every day. by PRMan · · Score: 2

      That's because some guys pointed out in the blockchain that MagicalTux (Karpeles) was proven to have previously had access to an account with 200,000 bitcoins in it. That meant that any coins spent out of that account would be proven theft. Better to say they "forgot" about them.

      --
      Peter predicted that you would "deliberately forget" creation 2000 years ago...
    29. Re: Smelling more fishy every day. by Jesrad · · Score: 2

      I initially read that as 'insensitive dad', that would have been interesting.

      --
      Maybe we deserve this world ?
  2. Reminds me of the time... by jittles · · Score: 5, Funny

    Oh I know how that is. The other day I put on one of my old winter coats from years ago and found 500,000 bitcoins in the pocket. It was completely unexpected. I used it to buy a pizza.

    1. Re:Reminds me of the time... by Megane · · Score: 2

      If you had just waited a day longer for the price to fluctuate, you could have bought a thousand pizzas.

      --
      #naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
    2. Re:Reminds me of the time... by Anonymous Coward · · Score: 3, Funny

      Or a thousandth of a pizza...

    3. Re:Reminds me of the time... by VortexCortex · · Score: 2

      Reminds me of the time this happened to a Norwegian guy who forgot he had bought $24.00 of bitcoin, after the price shot up he wound up with $850000 worth.

      Which reminds me of this other time another college kid said he invested $1500 in bitcoin, forgot the password, and when he finally remembered it was worth about $150000, not bad for a college kid.

      Happens more often than you'd think.

      I lost some on a flashdrive once. I thought the drive was empty, but I had just formatted it EXT3 and stupidly forgot how inferior MS operating systems are -- "Unformatted", yeah right Windoze. Glad I don't trust MS to format drives, ever, I was one click away from letting evil proprietary software destroy yet another batch of hard earned bits.

  3. Thieves by Anonymous Coward · · Score: 4, Insightful

    Thieves often place stolen goods nearby so they can retrieve them later

    1. Re:Thieves by XxtraLarGe · · Score: 2

      Thieves often place stolen goods nearby so they can retrieve them later

      But is it really theft if they didn't actually "take" it? If you're at the store, and you take a jar of peanut butter and later place it on the shelf of the produce aisle, did you shoplift?

      --
      Taking guns away from the 99% gives the 1% 100% of the power.
  4. While I expect foul play... by jellomizer · · Score: 3, Interesting

    I could argue that the system probably was setup to save lost bitcoins into a wallet.
    The CEO may not have known about it, as the programmers, probably felt that such an error could happen, so there was a mechanism to deal with it.

    --
    If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    1. Re:While I expect foul play... by Charliemopps · · Score: 4, Interesting

      Actually, I think there might be merit in your idea. We had a similar thing happen with one of our ticketing systems. Thousands of vanished tickets... They weren't even on the tables anymore! Oh no! Then we found them on some random table (there are thousands in the DB) and apparently, over 10 years ago, someone had conceived of the idea that something could go wrong, and instead of strait up deleting rows the system was throwing the deleted rows onto this "archive" table. The code that broke it was someone on another teams fault, but whomever wrote this way back in the day saved us a hell of a lot of trouble.

      Of course, MtGox could just be a bunch of thieves as well.

    2. Re:While I expect foul play... by Sarten-X · · Score: 2

      Never one to assume malice, my guess is that it was a temporary wallet used for short-term transfer of funds. Back when I worked in finance, we fairly often set up accounts for a few days, just to receive an incoming transfer or to send out funds from the right name. Those accounts, by their published nature, became targets for attack. It was always enlightening when a client sent in an emailed request to withdraw money from the temporary account, after we'd just closed the account as planned a few days before.

      Similarly, I'm thinking the wallet was opened, used, then emptied, but stuck around on their servers. It'd make a convenient place to hide stolen coins (regardless of who stole them). Those malleable transactions could be used to skim coins and push them into the wallet. If noticed, any investigation into the wallet would reveal that it was just an internal account, conducting low-volume business as usual. The thieves could then transfer the coins out at their leisure, in small similarly-innocuous amounts.

      Then everything collapses, and the company faces bankruptcy. Step one is to look at every asset the company has, and figure out whatever value it may have. Naturally, that would include explicitly checking each wallet, rather than just relying on what the database says the balance is. Lo and behold, one wallet has coins still in it, and the company might have assets to cover its debts, which is exactly why that search is the first step.

      --
      You do not have a moral or legal right to do absolutely anything you want.
    3. Re:While I expect foul play... by cusco · · Score: 2

      Here's what I'm wondering; $64 million is missing, and they find $116 million. Where the frack did the other $52 million dollars come from? If I've lost a 20 dollar bill and find 38 one dollar bills while looking for it I may be happy but I'm still missing a 20 dollar bill.

      --
      "Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
  5. Possible by GoCrazy · · Score: 4, Insightful

    While it's seems convenient and sketchy to magically find money after it was stolen, is it possible that MtGox is just that incompetent?

    --
    No beer and no TV make Homer something something
    1. Re:Possible by Anonymous Coward · · Score: 2, Informative

      That's called plausible deniability

  6. Ooooohhhh theeeeere's your money! by alexmogil · · Score: 2

    They have the lying skills of a twelve year old.

    --
    A winner is you!
    1. Re:Ooooohhhh theeeeere's your money! by myowntrueself · · Score: 3, Interesting

      They have the lying skills of a twelve year old.

      Do not underestimate the lying skills of children!

      At 10 years old I realised that if I wanted to lie to my mum the best way was to first offer an obvious lie which she would detect and demand 'the truth'. I'd then, unwillingly, offer a more plausible lie. She'd accept the more plausible lie as the truth; she felt like she'd won a victory over me, that she was so much smarter than me and that I was obviously ashamed at having been caught and had admitted the truth.

      --
      In the free world the media isn't government run; the government is media run.
    2. Re:Ooooohhhh theeeeere's your money! by citylivin · · Score: 4, Insightful

      She was just being nice. As the parent of an 11 year old, they make very bad liars. I just take everything my children say with a grain of salt. The thing with lies is if you understand peoples motivations in life, what they are interested in, what they desire. Then you can easily see when they are lying, withholding information or distorting their own memories to match with a current assumed reality.

      I find that it's good practice to firstly identify peoples motivations and character and then look at everything they say through that prism.

      --
      As a potential lottery winner, I totally support tax cuts for the wealthy
  7. Check behind the fridge by Hognoxious · · Score: 5, Funny

    I'm going to check behind the fridge and under the couch.

    I hear someone's lost an airliner.

    --
    Confucius say, "Find worm in apple - bad. Find half a worm - worse."
  8. As Falkvinge says by Anonymous Coward · · Score: 5, Insightful

    As Falkvinge says, this looks like a copycat fraud.

    In one of the first major bitcoin scams, mybitcoin com in 2011, the owner also said hackers took everything and "luckily" recovered a percentage of the funds some weeks later. This is a classic con man move, called cooling the mark out. You're supposed to accept that you were stupid, take your losses and go home, rather than pursue the scammers for the rest.

    1. Re:As Falkvinge says by Comrade+Ogilvy · · Score: 2

      Yours is a very plausible theory.

      The slightly more innocent (but still probably criminal) interpretation is that MtGox employees were scrambling to make transfers that kept themselves financially whole, while the company burned down with everyone else's assets. That is usually fraud when viewed under the bright lights of a courtroom, because of the implied or explicit promises made to customers, even when the company somehow escapes the usual fiduciary duty to its account holders.

      A week ago there was a rumor going around that 200,000 bitcoin seemed to have been transferred to a place the CEO had provably had involvement with in the past. It could be that the CEO finally recognized that his own efforts to cover his tracks were inadequate, and if he did not "discover" this "accounting error", he would be put in jail.

  9. Re:It's even more amazing... by jeffb+(2.718) · · Score: 2

    it's a shady way of transferring money anonymously.

    One man's "shady" is another man's "prudently concealed".

  10. What does "stealing" bitcoins mean anyway? by presidenteloco · · Score: 2

    If you copy my wallet (cloudy or cold) and know the decryption password or whatever, presumably I still have it as well, since it's just digital data.

    So it is a race to see who spends them first I guess, me, if I discover the "theft" quickly, or you right after you access the data.

    Or I guess you could copy the coins data then do a secure wipe on my storage including my backups. That seems implausible if I have a decent backups policy.

    Anyone know what "stealing" bit coins from MtGox actually meant in this case?

    --

    Where are we going and why are we in a handbasket?
  11. Big mystery by Wansu · · Score: 2

    "There is no explanation yet of why the sneaky thieves that 'stole' the bitcoins used a MtGox wallet to hide them."

    Sure there is. The explanation is the whole thing is a huge swindle.

    --
    Wansu, th' chinese sailor
  12. More likely duplicates by goombah99 · · Score: 4, Informative

    Consider, What does it mean for a bitcoin to be lost or to be found or to exist. To be "lost" it means no one no longer knows the bitcoin's key. Yet you can also have more than one copy of the key. For example MagicTux might have "stolen" the coin (that is, transfered a coin to a key, deleted that key from the mtGox data base ("oopsie") but secretly kept a copy of the key somewhere else. But then suppose that not all copies of the key were deleted. Both the "found" key and the one lurking in MagicTux's hideout are the same valid key. Either one can spend the coin.

    Thus there is not one copy of the coin to be found. there could be many.

    If you give someone control of your wallet, so that they know your keys, you can never get back that control. They can always keep copies of it and have the authrority to spend. THe only way to recover control is to make a new key and transfer the coins to that. Thus these exchanges that manage your coins are scary.

    --
    Some drink at the fountain of knowledge. Others just gargle.
    1. Re:More likely duplicates by jythie · · Score: 2

      Though it almost sounds like in this case they thought the coins had been transferred out into a new wallet and never were, thus they old copy of what should be a useless key to an empty wallet turned out to be valuable.

    2. Re:More likely duplicates by Anonymous Coward · · Score: 2, Insightful

      I have not understood the concept of BitCoin exchanges:

      1: Unlike banks which are similar in "just keep your money with us... yes, you can trust us", banks have insurance where if they go under, your cash is safe up to a certain amount. A BitCoin exchange going under, those coins are lost forever, period. I don't know any BitCoin exchanges that have insurance, much even an independent auditor coming in to check that they have a basic set of security standards.

      2: If an exchange takes all the coins it has, dumps them into a wallet, and walks off, there is no criminal liability for doing so. Just using the excuse of being hacked is good enough to get off the hook. Then the wallet can be sold, the goods transferred into other wallets, etc. BitCoin by itself can be traced, but some shell games with wallets make for easy laundering.

      3: What does an exchange do for a person? If you want any security against double spending, you have to walk the whole blockchain history for every transaction, and this only will get hairier as time goes on and coins get split up into satoshi. Only use for an exchange is turning BTC into another currency and back. To trust one for storing coins is idiocy at best.

      4: Do exchanges have any internal protection if hacked? There should be a layer between the wallets and the outside world, something that isn't easily breachable by a single phish attempt or two.

    3. Re:More likely duplicates by Jane+Q.+Public · · Score: 3, Informative

      "If you give someone control of your wallet, so that they know your keys, you can never get back that control."

      Yes you can. Create a new wallet and pay those bitcoins into the new wallet. Done.

    4. Re:More likely duplicates by JesseMcDonald · · Score: 3, Insightful

      The GP already alluded to that. But that gives you control over the funds in a new wallet, not control over the original wallet. If someone sends new funds to the old address you won't have exclusive control over them until you've transferred them elsewhere.

      Think of wallets as free, unbreakable safes with fixed combinations. If someone else learns the combination, you can move the contents to a different safe that only you know the combination to (as long as you get to it first), but the other party will always be able to get into the original safe.

      --
      "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
  13. Re:BS by ArcadeMan · · Score: 2

    That's not a very safe place to keep your wallet.

  14. Re:BS by hawkinspeter · · Score: 2

    It sounds to me like it's a very safe place. You're going to notice any pickpockets pretty quickly.

    --
    You're a temporary arrangement of matter sliding towards oblivion in a cold, uncaring universe
  15. If MtGox hadn't been hacked... by gnasher719 · · Score: 3, Insightful

    So let me see if I get this right: If MtGox hadn't been hacked, and if they hadn't found this old wallet, then these guys would have lost $116 million out of sheer incompetence? Can you imagine Bezos saying to Amazon shareholders: "Sorry guys, we lost $116 million. The money must be somewhere in the building, but we can't find it. " Or Tim Cook. Or Eric Schmidt. Or Ballmer.

    1. Re:If MtGox hadn't been hacked... by Outtascope · · Score: 2

      See AIG, circa 2005. Much more than $116 million.