Mt. Gox under DDoS attack as bitcoin price surges
computerworld.com
computerworld.com
I don't doubt for a minute that the authorities find this amusing since they would no doubt rather a currency outside anyone's jurisdiction got established and so people who destabilize it are "friends" of a sort. That makes them less likely to intervene.
That combination makes BitCoin sort of like [1] Eve Online, but with drugs instead of spaceships. I wonder if this will lead to the creation of 'recovery agents' like the art world has, usually former thieves or investigators who work for insurance companies for a percentage of the recovered value.
[1] in the sense that you can scheme and plan large takeovers and heists and the "outside" world doesn't care.
Every physical good we have has only the value we instill in it in our minds. The absolute best analogue to this is chips at a casino. Chips really are a parallel currency. They can buy you anything within the mini economy of the host casino (and additionally are accepted by other fringe elements in said city). They can be exchanged back for USD as well. Despite this, the authorities in Las Vegas take casino chip theft very seriously. Now people can go out of their way to explain how chips aren't really currency for whatever reason they want. To that I could then respond "fine, but in that case I also don't believe bitcoin to be currency either, just my own digital property, like an iTunes song. So I still expect to have these digital assets protected by the law".
It's at least certainly the case that if I were to find a way to download the iTunes tracks off iTunes for free, I would be charged with theft (whether you agree with that or not).
But to address your original comment, you are absolutely correct that folks can create arbitrary currencies out of arbitrary goods (such as bicycles), but some make better choices than others.
Bicycles have the benefit of having both a 'property' value which was established by their replacement cost (great posts on Priceonomics on that[1]) but a poor recovery rate. They are also hard to store and are distinctly less useful to people far away from you because shipping has high costs. You could use in-game WoW items, but they too get little respect when stolen [2] :-) Casino chips however are a great analog, not only because they translate 1:1 to dollars but also because I grew up in Las Vegas and had lots of experience with them as a "currency" and later as a forbidden currency.
When Casino chips are stolen, surprisingly enough, the police don't care. Which is to say that as far as the police are concerned they have zero value (even though they have a nominal face value) That value is enforced by the casino not the state. So casinos care when they are stolen and take responsibility for punishing the people who steal them.
There was a series on one of the discovery channels called "Cheating Vegas" [3] which talked about some of the higher profile ways in which casinos were taken advantage of and something you should note if you get to see it, is that the people who stole Casino chips and forged casino chips, they aren't accused of theft they are accused of cheating the casino. It's a weird thing but people go to Vegas in order to "get" chips from the casinos, the casinos make up games with rules by which they can do that, and the gaming commission ensures that neither the customer nor the casino can violate the rules as stated. Forging casino chips isn't so much a "crime" as it is an unlicensed way to accumulate chips. How strange is that? Anyway the point is that the Casinos spend a ton of their own money (a portion of their profits) on security systems, private guards, etc.
To achieve a similar enforcement system with Bitcoin you would need some agency which used part of their profits to hunt down and deal with people who acquired their BitCoin in an unapproved way. So lets say Mt. Gox did this. They took 1% of their transaction charge and funded a team of ex-special forces types working for Blackwater[4] to apprehend them. Then what? Under what you and I recognize as "the law" the status of BitCoin is the same as gold coins in World of Warcraft, a digital product that some people are willing to exchange for other currencies.
So here is the bottom line, if you steal a currency that is issued by a country as legal tender, that country has an internationally recognized right to prosecute in their judicial system. If you steal a currency that is issued by a private enterprise their actions are limited by what they can do in the Terms of Service (for game companies) or adjacent laws (in the case of gambling). Stealing this stuff really pisses people off and its wrong but in all the ways that count it isn't actually "illegal" as far as I can discover. (would love to hear a legal theory on prosecuting a bitcoin theft btw, I've been chatting off and on with my public defender sister-in-law and she hasn't come up with one either)
[1] http://blog.priceonomics.com/post/30393216796/what-happens-t...
[2] http://www.youtube.com/watch?v=jSyjcib_Fps
[3] http://america.discovery.com/tv-shows/cheating-vegas/about-c...
[4] http://academi.com/ (renamed Blackwater, see http://abcnews.go.com/Blotter/blackwater-renames/story?id=15...)
As the stakes grow higher Bitcoin is turning into an interesting endeavor in building resilent systems and preventing Single Points of Failure.
Maybe ticker/trade data could be spread over a gossip network as well. That's not as trivial as it sounds, though, for example how to check that trades are real and not just spam/manipulation. Maybe some way of authenticating exchanges by signing the packets (but then -otc would be left out... maybe their reputation system could be integrated somehow).
Source: MagicalTux (person who runs Gox) in freenode #mtgox.
And the concept is hardly new: http://news.bbc.co.uk/2/hi/technology/4579623.stm
We're throwing out our entire OLTP system, but trust us - the lag and error pages that have been popping up on our heaviest trading day of the year are caused by hackers.
> Like our favorite author here at Tibanne says… Don’t Panic!
> “Panic-selling is a wide-scale selling of an investment which causes a sharp decline in prices.[...]” (Source: Wikipedia)
But... But I want it to crash! Just a little! So I can finally buy lots of bitcoins myself!
What that means in practice is that some people will buy after 5% drop, more after 10%, even more after 15%, etc... I don't believe anymore that we can have a proper crash in this situation. If we do, the price will bounce back in a matter of seconds. I'm probably not the only one keeping an open order to buy as many bitcoins as possible at below £5. Lack of sell-stop orders on mtgox also means there's nothing to balance them out (apart from automatic trading).
So while both events may have a similar cause/progress... there's a huge difference in how the market itself works.
Bitcoins is a ForEx market, and like any ForEx market, you can lose money, quickly.
If you're buying bitcoins in order to make an online purchase, you're using it as a currency.
If you're buying bitcoins, then selling them back to dollars/whatever when you need money, you're treating it as speculation.
Did anyone ever claim that it was? I mean...it's a real currency in the sense that people are using it to exchange goods and services, but IMO anyone who has the expectation that Bitcoin should have had all of its issues figured out right out of the gate has their standards set a wee bit high.
Just like with bitcoin.
The difference is that USD, Euro, Yen, etc are all trillion dollar markets, where BTC is measured in millions. The speculative market pushes around the valuation a lot more, and BTC swings a truckload more from trading in its exchange rates than any other currency - changes in the Euro are measured in cents over a year, not in a hundred dollars over 6 months.
I won't argue people are buying BTC to use for exchange right now, though - of course a lot of people are investing in it when it is gaining legitimacy.
I don't understand what a DDoS has to do with trade lag. They're DDoSing the website, not the trading engine, right?
6 or 7 seconds is bad enough, but it's a huge understatement. MtGox's trading engine "lag" can grow to absurd numbers, it was like 10 minutes a couple days ago. I honestly can't comprehend how it gets this bad. It should be on the order of micro or milli seconds. It's not like matching up trades is computationally expensive.
Anyone have an explanation?
Edit: Seems you updated the post, so now my is obsolete :).
Anyway, their official explanation is that the engine is so slow because when iterating over the whole orderbook, which is huge, they have to check if every offer has enough funds for it to be executed. This is a design flaw and they want to fix it by not letting you to place a order without sufficient funds in the first place.
They currently have a project underway to separate the two.
The site owner, MagcialTux, said yesterday in irc that for the last couple of years (since the first bubble) they've basically made barely enough revenue to keep the site running (and sometimes at a loss), much less improving it. They looked at loans, but the most they could arrange was a couple hundred thousand, which wouldn't have been enough apparently. They also privately contacted big bitcoin fortune holders for loans, to the same result.
The kind of people that you'd hire to make it work right are expensive, to no one's surprise. The last few months have given Gox a huge increase in revenue, and they're using it to finally upgrade their tech.
I'm not a Gox fan, and I wish people would use the other exchanges and get some diversity into the system, but I can understand how they got where they are.
Well that's actually bad if you day trade... which is kinda bad for the currency anyway.
At least to my understanding, EFNet was (is?) an IRC network. With channels. Where people chat. Maybe I missed some relevant history?
And ferite. (a c-like scripting language that I love, with regex's)
https://encrypted.google.com/search?q=Mt.+Gox
https://mtgox.com/ "Mt.Gox is the world's most established Bitcoin exchange."
I requested 2 withdrawals more than a week ago and didnt receive any funds nor do the requests show up in my account history...
(kidding)
Edit: Oh they're already using it? Guess they can't save the day then... MtGox seem to be up now though.
In the case of cloudflare there is no great data loss if they disappear, though they could intercept passwords and private data (can you trust them? who has access? what if they are hacked?). But when a service such as gmail (suddenly) disappears... it would be devastating to many people. Much like the failure of a bank.
Furthermore, I believe the way it works is that clients make an SSL connection to CloudFlare, who makes another SSL connection to your service (using different key pairs.) Granted, they still get to see all your traffic unencrypted, but it all just comes back to trust.