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Mt.Gox Bitcoin update on the situation and what happened last night

TOKYO - JAPAN - April 11, 2013

Hi everyone, just a quick update on the situation and what happened last night.

First of all we would like to reassure you but no we were not last night victim of a DDoS but instead victim of our own success!

Indeed the rather astonishing amount of new account opened in the last few days added to the existing one plus the number of trade made a huge impact on the overall system that started to lag. As expected in such situation people started to panic, started to sell Bitcoin in mass (Panic Sale) resulting in an increase of trade that ultimately froze the trade engine!

To give you an idea of how impressive things were here are some numbers that we would love to share with you guys:
- The number of trades executed tripled in the last 24hrs.
- The number of new account opened went from 60k for March alone to 75k new account created for the first few days of April! We now have roughly 20,000 new accounts created each day.

Due to these facts we have been busy working on improving things since last week and our team has been working around the clock to improve Mt.Gox to catch up with the demand. We will continue to release several updates today and in the coming few days to improve our system overall performance.

Also please note that we may have to close the exchange for two hours in the next 12 to 24hrs to add several new servers to our system.

Thank you for your understanding and continuous support!

Regards
Mt.Gox Co. Ltd Team.

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F*ck MtGox...

There are many other exchange companies in the world just to name a few:

BitStamp, CoinCase, BitFloor, Campbx, BCT-E, cavirtex, and the list goes on...

People are leaving mtgox... especially seasoned bitcoiners:

https://bitcointalk.org/index.php?topic=172991.0

its ridiculous that one single exchange company have so much influence.. I have never used and exchange company, nor do I think I ever will. This is a P2P technology and intermediaries are not even necessary.

If you are a newbie and need to use an exchange company okay do it... but please not mtgox...

"We’ve moved beyond the Mises textbook. We’re running in the open market." - Erik Voorhees

bump

to provide info

Also here is the link to the press release.

https://mtgox.com/press_release_20130411.html

Last, people should know that Mt.Gox does handle roughly 80% of bitcoin currency trades, but there are many more exchanges. See here:

https://en.bitcoin.it/wiki/Trade#Currency_exchanges

Demand Keeps Growing Exponentially!!!

http://www.dailypaul.com/281462/bitcoin-volatility-caused-by...

"We’ve moved beyond the Mises textbook. We’re running in the open market." - Erik Voorhees

Yes!!!

and everyone knows that sharp increases in demand causes price drops!!! :D

.
~wobbles but doesn't fall down~

Where do the dollars go when you buy Bitcoins?

"This question seems to me to be such an obvious question, that it must be answered somewhere.
As I understand it is necessary to buy bitcoins using dollars or some other currency. Where do those dollars etc. go?

When you buy a bottle of soda at the convenience store, where does the money go?

The money goes to the party that sold it to you -- that party owned the bottle before you owned it. You might be able to trace ownership of that bottle all the way back through the supply chain, to the point at which it was manufactured. It probably had several prior owners before you got it.

Bitcoins are like a commodity that works the same way.

If you purchase from a market exchange (like Mt. Gox), here's how that works. Mt. Gox, like most market exchanges, operates using deposit accounts.

To buy $100 USD worth of bitcoins you must have deposited $100 to your account with the exchange. To sell 10 bitcoins you must have deposited 10 BTC to your account with the exchange.

So when you trade your $100 USD for someone else's 10 BTC, your $100 goes to their account, and their 10 BTC goes to yours (if there were fees, the amounts would be adjusted appropriately to cover fees).

Then when you withdraw your BTCs, the exchange will send that amount of bitcoins from the exchange's wallet to yours. When the seller withdraws the USDs (or whatever currency the coins were sold for), the exchange will send those funds. This generally occurs through the banking system, with the funds eventually arriving in the seller's bank account.

There are other types of bitcoin sellers -- direct sellers, who have an inventory of bitcoins that they purchased previously, or will make a trade behind the scenes to be able to deliver your order. So the dollars from your purchase goes to them in exchange for the bitcoins they owned.

Then there are other types of trades which involve risk. These include financial derivatives where you may speculate on bitcoins using cash but until you actually withdraw those bitcoins to your own wallet, you only own a claim against those bitcoins (or against a financial position on bitcoins). But that is an example where there is not a simple buying and selling of bitcions at a certain price.

Now every bitcoin in existence originated from mining. Mined coins arrive 50 at a time about once every ten minutes. They are earned by a mining operator (or mining pool and distributed to the mining operators who were mining). To mine, one must buy expensive hardware, expend the effort to build and operate the equipment, and purchase the electricity expended during mining. The mining operators can then deposit their bitcoin proceeds to an exchange to sell them and receive cash in exchange.

It's like when you buy anything else. When you trade your dollars for somebody else's eggs, you get the other person's eggs, and they get your dollars.

You can then sell the eggs to somebody else if you like - then you get their dollars, and they get your eggs. If you are able to sell your eggs for more than you paid for them, you make a profit.

Instead of buying eggs, it is possible to mine them (using a device commonly known as a 'hen'). Hens make eggs out of thin air, and are effectively a license to print money since the eggs they make can be traded for dollars. They do require fuel to run, which costs money. Miners need to determine whether their earnings from mining eggs is enough to offset the fuel costs.

Unlike eggs, however, there is a fixed limit of 21 million bitcoins that will ever be created, which makes them relatively scarce, and helps give them value."

Repeating silly arguments does not remove the silliness.

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Free includes debt-free!