Mt Gox Files Bankruptcy as Customers Lose Faith in Exchange - Update 3


New member
May 16, 2010
Strazdas said:
Mister Chippy said:
made worse by the fact that you are speculating in something with absolutely no actual value whatsoever.
as opposed to? What other speculative good with perhaps exception of actual goods such as wheat or gold has actual value? most speculative good - USD has no actual value either.
shh dont tell anyone.

really though bubble refers to when something become grossly overvalued by investors and speculators, housing markets, stocks any system where stuff is bought and traded can be manipulated or just run up on its own to the point you get bubbles, eventually these bubbles tend to self correct.

bitcon was stupidly valued for a good bit either way no way they were worth what they were being traded for and the actions by governments on top of hackers that seemed to have stolen any actual value the things had, yea all the governements currencies are the same shell game of no value backed by nothing currencies. why we can print debt and spend debt like its real actual money and skate sofar.

but our currency has bubbles its called inflation and that why all our prices shoot up and have been shooting up because we are printing and spending debt inflating the hell out of the currency no matter what politicians what to spoon feed bullshit you.


New member
Jun 2, 2010
One thing I have seen very little discussion of regarding Bitcoin and similar virtual currencies. No one seems to have figured out that they literall are "Blood Money". Just do the math. Bitcoins are generated by farming for them using intense processor heavy calculations tying up computer processing time. So who would be the best Bitcoin farmers? Well maybe nation states with vast computing power particularly of the type used for things like Nuclear Modelling? well why would any such Nation states bother to do that, they can print their own money? Unless they are international pariah's with the blood of millions on their hands. Hmmm? Is North Korea immediately coming to anybodies mind? After all Bitcoin farming seems less challenging than counterfeiting US currency. Just farm or steal Bitcoins and use the deep web to launder them for Dollars and Euro's. (and when done laundering them, steal them back to launder them to the next set of fools.)


Mandatory Madness!
Aug 31, 2010
Mylinkay Asdara said:
I suppose it's entirely too much to hope that all these economic ups and downs and hiccoughs in these made up currencies inspires a rethinking of the entire economic system ideas in the world that somehow gets us to the point where money ceases to exist - ala Star Trek, not back to trading goats for firewood.


I never really understood the Bitcoin thing anyway, except as a way to buy things you aren't supposed to with untraceable monies - the whole point seemed lost when corporations and governments got in on the whole gig. /shrug.
Well, in many ways we're already at the apex of the post scarcity world necessary to have money become something more fluid and eventually disappear. The hindrance is that we create a lot of artificial scarcity to keep many fields of development up. Things like furthering the technology of the 3D Printer (once it's cheap enough and sophisticated enough to produce anything you want, what for would you have to buy anything else?) will be the deciding factor on the way to "trek" sociology-economic path. First kill scarcity, then unify the masses.


Hat Man
Jul 8, 2011
San Diego, CA
cerebus23 said:
but our currency has bubbles its called inflation and that why all our prices shoot up and have been shooting up because we are printing and spending debt inflating the hell out of the currency no matter what politicians what to spoon feed bullshit you.
If a currency were to have a bubble, that would look like deflation, not inflation (until the bubble popped, of course). We have bubbles because there's too much capital chasing too few worthwhile investments; anything can become a de facto pyramid scheme. A bunch of people start investing, causing the price to go up, causing other people to think it would be a good investment...

USD inflation is actually very low - arguably too low - and has been for some time. All those people warning about imminent hyperinflation were very, very wrong, and some of them lost a lot of money because they believed their argument.


Robots will replace your job
May 28, 2011
Pyrian said:
"Extremely unreliable"? Please. Compared to what? Certainly not gold or bitcoin. Really, we could use a drop in the dollar. Having an overvalued currency is nice for buying cheap stuff from abroad, but it kind of sucks for trying to be competitive in the international market.
Well, you got me here, there is no realiable stable items for pricing. The most stables ones seems to be the rare metals that are less prone to speculation (basically all but gold and silver which si where specualtors are concentrating most of the time).
While having low currency value does help your exports, it is the countries that have high currency value that seem to be doing the best. However i agree that US needs to increase its exporting amounts, however they alraedy had a drop in the dollar, and quite a big one.

Scrumpmonkey said:
Bravo. You join the group of people to win my "Fundamental misunderstanding of currency" award.

Stable currencies do not just run on faith, I've explained this before in previous bitcoin threads, they are backed by central banks. The pound and the dollar do fluctuate but The Bank of England and the Federal reserve have power to respond. Central currency controls are what make a currency stable; the Pound for example is backed up by the Bank of England and has the full support of the treasury and is given credibility by the entire UK economy. Without these supporting factors the £ and the $ would have died long ago. What did the Federal reserve do when the financial crisis hit? It bought up billions of dollars worth of bad debt to support the economy and it lowered interest rates. A central bank can act to counter destabilizing forces as can a government.

Central banks, Strong GDP, currency reserves, economic policy, confidence in an economy, interest rates; these are the difference between the imaginary bitcoin and a real currency supported by the weight of a country. Bitcoin is an unregulated COMMODITY. It is not, by any definition apart from its own, a currency.

Anyhone who has ever invested in a bitcoin believing it to be the same as a safe real-world currency needs to take economics 101 again.
Thank you for the award but i may have to return it.

Currencies run on faith. All of them. the only part of currency that could be considered backing is the smallest denominations of cash perhaps (for example 1 cent actually has 1.4 cents worth of iron in it). Central banks can only back very small amount of the currency they have put out in actual reserves, and even then vast majority of those reserves consists of nothing but other currencies. The banks do try to regulate it by regulating the amount of money in circulation thus increasing or decreasing the turaround speed and they also used to regulate the money multiplicator factor, alas due to the recent crysis that mostly went to "as high as we can" level. Just because there are actions to stabilize the value percieved does not mean that there is intrinsit value behind it though.
I should remind you however that Central Banks are private institutions that do not own countries economies, so no, its not backed by whole economy. In fact quite the opposite - the economy is backed by the currency. a currency that is based on faith.
All currencies are commodities. Its simply ones that have no actual value of their own and instead are used as a middleman between natural trade. thats what they were invented for. Since Bitcoin also has no intrinsit value and is used for middleman between pruchases of goods and services, it is very much in the same category. Its backing is different, granted.

I agree that Bitcoin was never a "SAfe investment", but then, noone here was claiming that now were we?

Icehearted said:
I don't get how Bitcoin works. Who decided these were worth anything? Why has this gone as far as it has with businesses accepting this new and very volatile "make-believe" currency? It's just got Calvinball written all over it and I'm genuinely baffled at how this all actually translated to real currency in the first place.

Pardon my ignorance.
just like with any other currency - WE decide how much it is worth. As far as business accepting it, popularity would be my guess, they wanted to look hip and new and catch the "internet crowd". this never works but companies dont learn.
The translation is simple: you give company bitcoins and they give you dollars. Why you ask? because they THINK its worth it.

I remember reading all about this once, maybe nine years or so ago, where someone broke down the reasoning behind the value of gold in the first place, which if I remember right was akin to the diamond cartel inflating the price of diamonds despite the fact that they are very common and very easy to replicate. He wrote that gold is not as conductive as other metals like silver, and he wrote that it had to do with amounts and rarity above and below the surface of the earth. He then added that silver was in actuality rarer than gold and therefore should be a more precious metal.

If I understand Mister Chippy, the sense here is that it's only valuable because someone at some point just decided it was, kind of like diamonds and Bitcoin. That actually sounds about right to me.
The gold that we put for shinies price is very much a cartel akin to that of diamonds. were talking about industrial gold here however, and that one has different value and is the item thats traded in international markets usually. while silver does have more electroconductivity, Gold is much better at being streched out into think layers without loosing its structural integrity [], which makes it the choice metal for microelectronics that measure in nanometers.
Wast majority of golds prices and the artificial rarity comes from two factors mainly:
1. hoarding. there are plenty of institutions simply hoarding gold sitting on it. this removes it from circulation and creates scarcity. and they count in billions.
2. speculation, but that bubble seems to have finally busted now.

CriticKitten said:
Oh dear, you again. Do you ever research your claims, or do you just keep insisting that it's everyone else's research that is wrong?
Given our previuos encounters and your lack of knowledge what a source even means as evident By this thread [] you are not the one to make any claims here. Therefore i chose not to respond to your accusations.


Robots will replace your job
May 28, 2011
Scrumpmonkey said:
**shakes head in despair** there is no point in talking about something if you can't correctly define what you are talking about. Do some reading on what a commodity is, the concept of legal tender and have a good think about how Bitcoin is completely unsupported by any stabilizing factors or controls.
Thank you for your suggestion but i have already been reading up on it. for 4 years in fact. Not that you countered the sentence you nicely cherrypicked anyway. Having stabilizing factors and controls does not turn the item into something above commodity. Currency is merely a nice definition for legal tender that is officialy recognized. It is still a commodity, a special commodity, sure, but a commodity.

CriticKitten said:
Strazdas said:
Given our previuos encounters and your lack of knowledge what a source even means as evident By this thread [] you are not the one to make any claims here. Therefore i chose not to respond to your accusations.
That's hilarious. I completely dismantled your argument and you choose not to respond to it because of a completely different thread (in which, by the way, I dismantled you AGAIN, so stop pretending to take credit for something you had nothing to do with), as if that thread holds any bearing on what is going on here. That's ad hominem at its finest, and it's the weakest possible response to any legitimate debate ever.

If you choose not to respond, then I choose to take your refusal to respond as an indication that you acknowledge the fact that you are wrong and can't put together a legitimate counterargument to anything I've said. I take your response as a white flag. That said, I'm going to keep responding to your posts anyways, because you're still saying things that are clearly wrong and come from someone who doesn't know what he's talking about.
Considering you opened your post with ad hominem you are not the one to talk about it. again. What you "take" my response as i do not care. It is not my job to prove you anything. Your insistent false claims of victory when you have been repeatedly proven wrong does not help you case either. Therefore, basedon that i have no wish to respond to your arguments, legitimate or not this time (i havent actually bothered reading it anymore).
You of course can keep responding to my posts if you wish so. Escapist has provided us with a great feature called ignore list and you may end up being the first person i try it out with.

Oh, and yes, i didnt bother reading past the part that got quoted in the PM this time either, so i got no idea whether your counterarguments are valid or not here, your invalid arguments in the past has deterred me from wasting more of my time with it.