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Gox




--On Tuesday, February 25, 2014 3:44 PM -0700 Kelly John Rose <[email protected]>
wrote:


> They were given the coins by people who trusted them and their code to not
> be easily manipulated. Their code was crap and didn't do the tracking
> properly. They didn't steal the coins, they screwed up the code by not
> ensuring that it was to the level of quality needed for such a high amount
> of finance moving through it. This is not theft, it's incompetence. 

	Well, that's their story, which I don't find too plausible.

	Regardless, even if karpeles and friends didn't steal the coins
themselves, other people did, thanks to mtgox's incompetence. The problem
here is not a 'bank run' in the ordinary sense, it's just theft.



> This
> is closer to your bank leaving it's vault open or, in the case of Target,
> accidentally having all of the credit card numbers stolen.

	If the bank left the vault's door open, then there's something
fundamentally wrong with the bank, or there's some other funny business
going on. 

	Banks don't need 'regulators' telling them to keep their vaults closed... 


> 
> The problem here is that it is cheaper in the short term to create crappy
> code security-wise and push it live than it is to create code that is
> actually properly implemented for a banking environment to handle both the
> large amounts of money and the quite serious number of attacks that will
> take place once the amount of money available is established.
> 
> In a competitive environment, the folks who take short cuts will save
> money in the short term, and thus will be more likely to pick up users
> than a more expensive equivalent that actually did the security correctly.


	And in the long term they will be out of business. 

	Although that's not the whole picture. In this case, a different  problem
is that people are using a *centralized* exchange as a bank to keep their
supposedly *decentralized* e-money. 

	And that seems to be a trend. Seems to me that a lot of computer
illiterate people store their btc in online centralized wallets that have
access to the private keys? 


> 
> Regulations in this circumstance only have the effect of ensuring a
> certain level of quality and security for the end consumer by levelling
> the playing field to a certain standard.

	How could I have missed that? Government regulation is something created
by honest politicians taking into account the best interests of their
subjects =)



> 
> -- 
> Kelly John Rose
> Toronto, ON
> Phone: +1 647 638-4104
> Twitter: @kjrose
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> 
> Document contents are confidential between original recipients and sender.
>