AUG 4 DIGEST: Mt. Gox ‘Ran out of Funds 6 Months before Going Bust’; Australia Warms towards Bitcoin as Currency
Defunct Bitcoin exchange Mt. Gox is said to have ran out of money six months before it filed for bankruptcy; an Australian government inquiry has set the stage for Bitcoin to be treated like a national or foreign currency, and news
Defunct Bitcoin exchange Mt. Gox is said to have ran out of money six months before it filed for bankruptcy; an Australian government inquiry has set the stage for Bitcoin to be treated like a national or foreign currency, and more top stories for August 4.
Mt. Gox Ran out of Funds Six Months before Going Bust
Defunct Bitcoin exchange MtGox is said to have ran out of funds six months before it filed for bankruptcy in February 2014 after tens of millions of dollars’ worth of bitcoins and fiat had disappeared. The Tokyo-based outfit had allegedly been running a deficit on its balance sheet after the US Department of Homeland Security seized assets of around US$5 million kept in US bank accounts around May 2013.
Australia Takes First Step Toward Bitcoin as Currency
An Australian government inquiry has set the stage for Bitcoin to be treated like a “national or foreign currency”. A Senate Economics References Committee review into digital currencies in Australia has found they should be treated like any other currency for the purposes of the Goods and Services Tax (GST).
Labor Senator Sam Dastyari, who chaired the committee, said:
“Without a doubt, the main benefit will be the confidence and certainty that removing a GST will provide to our own digital entrepreneurs, and the foreign businesses who want to set up here […] Most importantly, it will send the message to local tech entrepreneurs that their government is listening to them, and that in itself is a major step forward.”
Bitcoin Core Developer Proposes 17.7% Yearly Block Size Growth; Still No White Smoke
In the ongoing debate regarding Bitcoin's block size limit, Bitcoin Core developer Pieter “Sipa” Wuille has published a Bitcoin Improvement Proposal (BIP) to increase the maximum block size by 17.7% per year, starting in January 2017. In the proposal dubbed “Block size following technological growth,” Wuille argues that his suggested maximum block size limit growth is tailored to stay in check with hardware and other technological improvements. However, like previous proposals, it seems unlikely Wuille's BIP 103 will reach a consensus within Bitcoin's development community.
Study Concludes 'All Bitcoin Users Are Tech Enthusiasts or Criminals'
A new study has attempted to shed light on Bitcoin users. Key data based on various search terms related to Bitcoin returned evidence of a distinct correlation between computer programmers and Bitcoin, and illegal activity and Bitcoin.
According to the authors:
“Although many commentators have speculated about motives for using Bitcoin, our study is the first to systematically analyze Bitcoin interest, including the interest of hard-to-observe clientèle. […] We find robust evidence that computer programming enthusiasts and illegal activity drive interest in Bitcoin and find limited or no support for political and investment motives.”
Former Visa Senior VP: A Troubled Country May Choose Bitcoin Over Central Banks
In a recent interview on the Epicenter Bitcoin podcast, Bitnet co-founder and CEO John McDonnell, who previously worked at Visa and CyberSource, said that Bitcoin may already look more attractive than local currencies in some economically-troubled countries around the world.
“In some cases, they don’t trust their own, sovereign currency, so it’s a store of value. The volatility of bitcoin might be more attractive than their central-bank-issued sovereign currency.”
BitDefender Hacked; Passwords Unencrypted and Hacker to be Paid in BTC
BitDefender, an award winning internet security Software Company based in Romania, has fallen victim to a data breach which leaked the company’s customer data including user names and passwords to an anonymous hacker. The customer data was stolen by a hacker with an online alias “DetoxRansome”. He claims, furthermore, that all information including passwords and user names were unencrypted and therefore available in plain text. The hacker demands US$15,000 in exchange for the data.
Robocoin Faces Lawsuit over Bitcoin ATM Refund
Bitcoin Solutions, a Canadian outfit operating three Bitcoin ATMs across Alberta and Saskatchewan, has announced that it will sue ATM producer Robocoin. Bitcoin Solutions president Adam O’Brien is seeking to get back part of the US$25,000 he paid for a kiosk in January 2014.
According to Bitcoin Solutions, the machine was never delivered:
“If you need a refresher, we paid for an ATM 19 months ago and still do not have it. [Robocoin CEO Jordan Kelly] will no longer take our calls or answer our texts/emails. Unfortunately, this needs to go to court.”
Bitcoin Firm Elliptic Wins 'Security Project of the Year'
London-based Bitcoin firm Elliptic has been awarded “Security Project of the Year” by The Banker magazine. Elliptic CTO and co-founder Adam Joyce said in a company post that the award reflected the increasing legitimization of blockchain technologies and Elliptic's success in building confidence and trust in the Bitcoin market.
The Banker awards judges explained:
“Projects such as Elliptic Vault could help make Bitcoin more attractive to relatively conventional or conservative financial institutions that still shy away from this new technology and its security issues.”