Mark Karpeles Gets Suspended Jail Term
bloomberg.com
bloomberg.com
Karpeles was clearly in over his head, and made terrible decisions after the hacking, but I don’t believe imprisonment would serve any meaningful purpose, and I do believe he feels genuine remorse for his actions.
Sure it would! It would serve as a deterrent. Some people shouldn't be handling hundreds of millions of USD.
Karpeles' operation wasn't just unprofessional finance, it was a complete shit-show. The court should have sent the message to others to not attempt something as complicated and risk-laden as operating a financial exchange without even the slightest bit of know-how necessary to do that.
Startup culture can be great, but it's amazingly dangerous when operating certain trades or industries.
I don't think Mark ever expected to handle that kind of money. It just sort of happened. One of the things usually needed to prove a crime was committed was that there was the intent to commit it.
> Startup culture can be great, but it's amazingly dangerous when operating certain trades or industries.
Mark's about the furthest thing from a startup bro. Honestly, I got the vibe he started MtGox as a hobby that happened to make money. A lot of it doesn't make sense from a business planning standpoint. Bet you didn't know the parent company of MtGox was named after his cat and served as a hosting company and domain registrar. He's a gentoo nerd that had a pet project win the lottery. There's far more to question about what the exchange had happen before he took it over, but I suppose jed won't talk about that.
To be fair though the year he spent in jail probably added some years to his life. While I doubt it was great for his mental health, it did wonders for getting his weight under control.
Mtgox was started by Jed McCaleb. He essentially gave it away for free to Karpeles when he realized that he was in over his head. It seems he was already losing money running mtgox and just wanted to get rid of it.
https://hackernoon.com/mt-gox-interviews-jed-mccaleb-on-the-...
That is probably true, and I wouldn't expect anyone to stand in the way of something that they had created and that developed such a momentum. How could one!
What I would expect, however, is (1) that person to recognize this momentum, (2) to recognize that this momentum is way above the person's head, and (3) to rent or hire the know-how necessary to deal with this.
IT Security consultants, legal experts, people with experience in running exchange systems, etc.
> One of the things usually needed to prove a crime was committed was that there was the intent to commit it.
There's no question of that, as the court found that he had tampered with accounts and manipulated records to hide losses.
I had read the story here and, having just a little experience of Financial systems (nowhere near enough) I offered to help.
Mark took my meeting on that day because, in retrospect, he was likely looking for a Hail Mary. Perhaps hoping for a ransom demand.
He was at least smart enough to know I wasn't it. Nevertheless, if there had been good options, as you seem to suppose, I very much doubt he'd have taken my meeting.
Mark was in over his head, even then. And that tsunami just kept on rolling in. I wish him well.
-otc bro high-five
as far as i understand Mt Gox wasn't a financial exchange, it was a marketplace for non-financial stuff like for example Magic cards and cryptocurrencies. People putting hundreds of millions of real money into a virtual goods traded at a place not registered with SEC have only themselves to blame.
Plus, the guy already spent a year in jail prior to the trial .
Yes, but deterrents don't work if you don't expect to handle hundreds of millions. And I don't believe he did expect to handle hundreds of millions. Nobody did. Bitcoin just... did that.
It is the fault of the law and the regulators, or of the users for not being aware that the law and the regulators were not on top of it.
This argument has never worked in the history of ever. The examples from history are far too numerous to list but if you really must need an example, the War on Drugs would serve that purpose.
I'd like to see any studies to back up this theory.
More than 100k BTC was "found" post bankruptcy IIRC, and only when the community started talking about where they were visible on the blockchain.
It is way too tempting to hide cryptocurrency, especially when accounting is a mess at best. We know for a fact that Mark traded on his own exchange and he must have known early on that it was not sustainable.
Remorse may not be the only thing that's important here. It must also be clear that white collar crime is not a business opportunity.
What I guess you are referring to is when big banks and wall street deliberately cheat and take investors money. And I think that should require people going to jail.
Also, from my own personal experience, startup culture is full of lies and deceit, and investors are not always big money firms looking to land its next unicorn exit. Regular people also invest in many startups.
There can't be special rules is all I'm saying. We need to improve 'startup culture' and one of the ways of doing that is by holding people accountable.
It is hard to hold people accountable as the legal system doesn't support this, even here in Europe. I don't know how to improve startup culture myself, except maybe to act with integrity in my own work, and to make sure that I do my homework better when I evaluate a startup
And yes, regular people generally get wiped out when they invest in startups, it happened to me a few times in the past too, but I wanted Unicorn exits too the same as the VC firms :)
Mark was in way over his head but nobody says he should be jailed for being in way over his head. He should be jailed for defrauding people. He cooked the books and he hid the fact that MtGox was insolvent practically from the moment he bought it.
And yes, I did lose money from insolvent banks too in the 2007 - 2008 Financial Crisis, and no one went to jail for that either, even though they hid information from investors and depositors... but that is partly why I was interested in Bitcoin in the first place...
https://www.youtube.com/watch?v=l70iRcSxqzo
https://blog.wizsec.jp/2015/04/the-missing-mtgox-bitcoins.ht...
Btw, with your 350 coins, I hope you've already submitted a claim and are planning to vote on the upcoming Civil Rehabilitation plan.
Mark has some of my coins and I think he's done enough time. Prison in general is cruel and unusual for anything besides violent offenders.
I also believe the punishment is what Mark has gone through since 2014 when MtGox officially went down. From what I have heard Mark has suffered enough, and I hope he can turn his life around
https://www.wired.com/2014/03/bitcoin-exchange/
https://www.reddit.com/r/Bitcoin/comments/1bzysz/til_mtgox_w...
https://bitcointalk.org/index.php?topic=4412667.0
https://web.archive.org/web/20070501000000*/http://mtgox.com
"sometime around late 2007, the service went live for approximately three months before McCaleb moved on to other projects" https://en.wikipedia.org/wiki/Mt._Gox#Founding_(2006-10)
Gwern: "we know the mtgox.com domain had a landing page discussing a forthcoming Magic card trading site (because a 2007 page is in the Internet Archive), but we can't find any evidence that there was any actual trading going on. Did anyone ever actually trade card for card or money for card on Mtgox.com?" McCaleb: "yeah they did" https://www.gwern.net/docs/bitcoin/2014-mccaleb
Thanks for the Gwern link, it's interesting.
Might be worse than the actual sentence.
EDIT: I found https://twitter.com/grace_za/status/1016688636304265216
Also it's all in the future. The distribution had not happened yet and many details have not been published.
They are really lucky as it is.