Bitcoin Exchange Mt Gox to be Given $6.1 Million in Customers’ Money by OKPay Following Recent Court Order

A court order was issued to OKPay, a payment processing company, forcing it to make payments that came to as much as $6.1 million to Mt Gox it has advised in defence of its transferral of the withheld deposits.

In the time just prior to the collapse of Mt Gox a huge number of payments belonging to individual customers of OKPay valued at $6,014,910 were handed over to the troubled bitcoin exchange.

OKPay had originally intended to give all of the money back to its customer and up to that point, which was around the middle of August, the funds had been sat in an account owned by Mt Gox in a state of limbo.

Following the receipt of an order from the courts in the British Virgin Islands, which is the registered location of OKPay, is was advised that Mt Gox legally owned the account and at this point the repayment of customers funds was no longer an option according to Konstantin Romanovsky, the CEO at OKPay.

Romanovsky advised that Mt Gox had forbidden it to return the money to customers even though it had originally fought hard to be able to do this. The order, however, to not return the money to its customers and instead place it in a Trustee Fund for Mt Gox came once they reached the court stage. He went on to add that although it may have had a serious impact on their image it was a decision that had been taken out of their hands by the courts at the BVI.

He also claimed that the rumours that had been spread claiming that for a number of reasons OKPay would also be closing down were complete nonsense and completely refuted them.

A message that had originally been sent out by OKPay advising that customer deposits that hadn’t been sent to Mt Gox would be sent back to customers had been posted by customers on a bitcoin forum. Customers were advised that because the payments made by OKPay were made following a court order there would be no point in taking any kind of legal action even though many customers had said they would be willing to do so.

It is likely, however, that any addition funds would, at the end of the case, be sent to creditors as they would be seen to be Mt Gox property, although no reason had officially been given for the litigation by the BVI.

Following a $200,000 payment to a Tibane, a parent company of Mt Gox, which is also owned by Mark Karpeles, the company’s CEO, there has been a great deal of displeasure shown by creditor at the way payments have been distributed so far since Mt Gox closed its door in February 2014.

Transactions using bitcoin exchanges including Mt Gox had been suspended by OKPay as far back as May 2013 as the company had advised that a number of its banking partners had said that payments using the bitcoin currency was not something they were comfortable with, although this is something that it reviewed later and it now uses a number of exchanges to trade bitcoins.

Source : http://www.livebitcoinnews.com

PayPal clip: “We can spend Bitcoin with a tap without a pocket”

A PayPal clip on Youtube, posted yesterday, apparently indicates that the payment processor is at peace with Bitcoin.

Branded “A People Economy, Now More Powerful than Ever”, a chorus of people chants the merits of a revolutionary way of making all sorts of payments.

It coincides with their subsidiary Braintree’s recent announcement to launch one-touch and Bitcoin payments, although the clip doesn’t mention this explicitly.

10 seconds in, the chorus says:

“Our phone is our wallet. We can spend Bitcoin with a tap without a pocket.”

Bitcoin had previously been touted as a threat to PayPal’s business, but a series of developments over the past 6 months have indicated that the payment processor and their parent, eBay, are warming up to working with the cryptocurrency. This comes a long way from reports of them censoring Bitcoin-related sales earlier this year.

Source : http://dcmagnates.com

Braintree partners with Coinbase for Bitcoin payment option for all of its merchants

Braintree has partnered with Coinbase to enable a bitcoin payment option for all of its merchants in the coming months.

Braintree is part of eBay’s PayPal unit, acquired for $800 million one year ago. The announcement confirms earlier reports that PayPal is looking to integrate bitcoin payments through its subsidiary.

Braintree made the announcement during TechCrunch Disrupt San Francisco, where it also unveiled mobile touch payments, which aim to increase the conversion rate of mobile shoppers.

For Braintree, Bitcoin is the next strategic step in offering consumers flexibility in their choice for payment options. Said CEO Bill Ready:

“We are excited to be partnering with a company that is equally committed to simplifying payments for both merchants and consumers, and look forward to working with Braintree to complete the integration.”

Towards the end of its announcement, Coinbase says that Braintree merchants will need to individually create accounts with Coinbase.

Braintree merchants pay 2.9% plus $0.30 per transaction. Coinbase doesn’t charge a fee for the first $1 million in sales, but will charge an additional 1% thereafter.

Source : http://dcmagnates.com

Indonesia, The Land of Bitcoin Opportunities

A while ago we reported on developments and plans that were going to take effect in Indonesia. Today  is a new day for Indonesia where people can get Bitcoins at convenience stores called 10000 Indomaret.

The Bitcoin Indonesia founder Oscar Darmawan explains why this is so important.

“The majority of the Indonesian people do not have a bank account with a bank. Because of this only a 10-20% of the indonesian people actually have a bank account, the rest don’t. This is a huge oversight on the banking sector to not address this difference. That is why we created this bitcoin over the counter system.

In so doing we can reach every person,if they are Indonesian or the many tourists Indonesia yearly receives, and we create an awareness at the same time. However our  main focus is on the 80-90% of indonesians who do not own a bank account. The added attention and business from tourists is a nice bonus. Indonesia is a beautiful place to visit”.

…..

“The system works as the following:this initiative is the brainchild of Bitcoin Indonesia and will run through its exchange Bitcoin.co.id for the exact BTC prices and it works in tandem with payment processor iPaymu”.

So if you are ever visiting the beautiful land of Indonesia, be sure to check out the convenience stores while meeting the local population.

Source : http://www.cryptoarticles.com

“Jeffrey” reportedly gains access to Satoshi Nakamoto’s e-mail, offers to reveal secrets for 25 BTC

 

Wired reports that the personal e-mail account of Satoshi Nakamoto, who is believed to be Bitcoin’s creator, was hacked.

Wired corresponded with a “Jeffrey” who said he took over Satoshi’s e-mail address, satoshin@gmx.com. He told them he gained access because “the fool used a primary gmx under his full name and had aliases set up underneath it. He’s also alive.”

Indeed, one of the many theories circulating today is that Nakamoto is dead, with the fate of his estimated stash of one million bitcoins unknown. Bitcoiners have been keeping an eye on his addresses, but thus far there has been no activity.

In a pastebin post, “A GUEST”, possibly this Jeffrey, writes:

“Releasing the so called “gods” dox if my address hits 25 BTC.

And no, this is not a scam, you can see the below screenshots for proof of inbox ownership and a little teaser.

BTC: 19pta6x1hXzV9F5hHnhMARYbRjuxF6xbbV

Same one posted on p2pfoundation^

Teasers:

https://www.anonimg.com/img/09f6cc92952dc4d539b21cad8daa2adf.png https://www.anonimg.com/img/045d00e4624fb3c3ffc7056af07317d0.pngSa”

Based on today’s prices, 25 BTC is worth $11,750. In total, the address has received only 1.5 BTC, with most of it withdrawn.

Wired says that the gmx-based e-mail address may have led to other accounts of Nakamoto being hijacked. On the P2P foundation website, Satoshi’s original Bitcoin announcement is responded to from his own account, with the following:

“Dear Satoshi. Your dox, passwords and IP addresses are being sold on the darknet. Apparently you didn’t configure Tor properly and your IP leaked when you used your email account sometime in 2010. You are not safe. You need to get out of where you are as soon as possible before these people harm you. Thank you for inventing Bitcoin.”

The provocative development has spawned numerous theories related to the reported hacking and the nature of Nakamoto. There are three theories as to how the address was reportedly taken over: Either Satoshi’s account expired, or gmx.com was hacked- or just Satoshi’s specific account.

Michael Marquardt, head administrator of the Bitcointalk.org discussion forum, said that Jeffrey sent him an excerpt from an e-mail he sent Nakamoto in March this year. With access to account content, it is unlikely that the account simply expired.

The latest saga also reignites curiosity as to Satoshi’s true identity. In March, Newsweek sparked controversy when it claimed to have identified him as Dorian Nakamoto.

At the extreme, it’s hard to disprove that Jeffrey isn’t Satoshi Nakamoto himself and that he’s been taking his Bitcoin followers for a ride for all these years. Unlikely, but anything’s possible in a virtual world full of virtual identities.

Source : http://dcmagnates.com

Hacker Hijacks Satoshi Nakamoto’s Email, Threatens to Reveal All

 

The bitcoin world is abuzz with speculation that some of Satoshi Nakamoto’s online accounts have been compromised, concerned a hacker could potentially access information concerning the bitcoin creator’s true identity or use the accounts to defraud key members of the bitcoin community.

Wired reported that the alleged hacker had posted on Pastebin that they would reveal key details of Nakamoto’s identity if 25 BTC were sent to a specified bitcoin address. While small donations have been coming in, the address still appears well short of that mark.

Administrator ‘theymos’ of the Bitcoin Talk forum (aka Michael Marquardt) a key figure in bitcoin’s online community, posted just after 9pm (BST) on 8th September, alerting the community of the development, writing:

“Today I received an email from satoshin@gmx.com (Satoshi’s old email address), the contents of which make me almost certain that the email account is compromised. The email was not spoofed in any way. It seems very likely that either Satoshi’s email account in particular or gmx.com in general was compromised, and the email account is now under the control of someone else. Perhaps satoshin@gmx.com expired and then someone else registered it.”

“Everyone knows that Bitcoin runs on drama, so this should do wonders for the recent price slump!” theymos added later.

Shortly after, another mysterious message appeared on the P2Pfoundation’s ‘ning’ message board, as a reply to Nakamoto’s original introduction to bitcoin. The post was sent from the Satoshi Nakamoto account, but appeared to warn him of what was happening:

“Dear Satoshi. Your dox, passwords and IP addresses are being sold on the darknet. Apparently you didn’t configure Tor properly and your IP leaked when you used your email account sometime in 2010. You are not safe. You need to get out of where you are as soon as possible before these people harm you. Thank you for inventing bitcoin.”

Bitcoin’s source code page on SourceForge also redirected to anti-bitcoin troll site ‘buttcoin’, although it was later returned to its original state (it would still be prudent to not download anything from that particular page, however).

Hacked or expired?

Many suggested the gmx.com address Nakamoto used had simply expired after a period of time and had been claimed by someone else.

However, bitcoin core developer Peter Todd wrote on Twitter roughly four hours after theymos’ original post that whoever controlled the email address also appeared to have access to Nakamoto’s email history, putting paid to the ‘expired’ theory.

Nakamoto, however, ‘retired’ from active participation in bitcoin in April 2011, and the hacker has not presented any evidence they have access to emails from before then.

Satoshi’s identity and fortune

Satoshi Nakamoto’s true identity is bitcoin’s core enigma, not just because the creator of the world’s most successful cryptocurrency experiment remains anonymous after nearly six years, but because bitcoin’s rising price would make that person extremely wealthy.

Some analysts say Satoshi Nakamoto’s bitcoin fortune could be as much as 1 million BTC, spread over a series of wallet address and the result of mining from bitcoin’s earliest days. Bitcoin enthusiasts have monitored these addresses closely in the hope of uncovering clues – but so far none of the funds have been touched, adding to the mystery.

They remain untouched as of press time. Any movement of those original coins on the open market would likely have an impact on bitcoin’s price.

Source : http://www.coindesk.com

Payments Processor Braintree Confirms Bitcoin Integration Rumors

Following weeks of rumors, Braintree has announced that it will soon enable customers to accept bitcoin.

Braintree, a subsidiary of eBay-owned PayPal that was acquired for $800m in 2013, revealed on its blog that it intends to release a software development kit (SDK) that developers and merchants can use to add bitcoin to their existing payment methods.

The integration is the result of a partnership with Coinbase, which was first reported to be in talks with Braintree about a potential partnership this August. Further, the news was officially announced at TechCrunch Disrupt San Francisco during a talk given by Braintree CEO Bill Ready.

Ready told TechCrunch:

“This is PayPal making a move to embrace Bitcoin.”

The official announcement also followed a teaser video that caused a stir in the bitcoin community today issued by PayPal itself and suggesting that Braintree’s parent company may move to accept bitcoin.

Coinbase indicated that developers at Coinbase and Braintree will be working together closely over the next few months to complete the integration. No formal timeline for the official launch date was given.

Early access

In its blog post regarding the announcement, Coinbase indicated that Braintree businesses will need to open a new merchant account with Coinbase in order to complete the integration upon its release.

However, Braintree merchants that want to get in early on the opportunity can move to contact Coinbase now through a dedicated email address. Further, Coinbase indicated that it will also disseminate future news relating to the launch through this mailing list.

As previously noted, the mobile payments processor supports thousands of high-tech startups, including notable brand names such as Airbnb, Dropbox, Hail-O, Hotel Tonight, LivingSocial, OpenTable, TaskRabbit and Uber and more.

Source : http://www.coindesk.com

PayPal Video Sparks Rumors About Potential Bitcoin Plans

PayPal has sparked speculation in the wider digital currency community with the release of a new promotional video that makes reference to bitcoin.

The video, titled ‘PayPal Voices’, was published on the company’s official YouTube page today.

The one-minute promo features a string of actors who are described as “the voices of the people economy”, extolling the benefits of using PayPal. Bitcoin is mentioned just 10 seconds into the video in the following voiceover passage:

“Our phone is our wallet. We can spend bitcoin with a tap, without a pocket.”

The news provides the latest evidence that either the eBay-owned company or its mobile payment processing subsidiary Braintree might move to integrate bitcoin into an upcoming project.

First reported by The Wall Street Journal this August, such speculation was given yet another boost today in an article by Re/code that suggested Braintree’s announcement may come as soon as today.

Braintree was acquired by PayPal in September 2013. PayPal itself is a subsidiary of eBay, one of the largest e-commerce companies on the web. Outspoken bitcoin advocate Marc Andreessen sits on the board of eBay.

Speculation mounts

At the time of writing, PayPal’s only reference to bitcoin integration is the excerpt from the video.

Still, speculation has run rampant, with more than 400 comments about the video splattered across YouTube and reddit.

Notable bitcoin investor and SecondMarket executive chairman Barry Silbert has joined in discussing the significance of the video:

More information needed

Details are still sparse, and even if the video is proven to be authentic, it’s not entirely clear what plans PayPal has for the digital currency.

While the video does not necessarily mean that PayPal will integrate with bitcoin, the timing of both Re/code’s news and the video raises many questions.

The bitcoin community has been vocal about the relationship between PayPal and bitcoin in the past. Many argue that the digital nature of bitcoin lends itself perfectly to PayPal’s business model, while others contend that bitcoin doesn’t need the support of a centralized platform to flourish.

Whatever the case may be, a PayPal-bitcoin integration would certainly shake up the industry and bring the digital currency significantly more visibility with the general public.

Source : http://www.coindesk.com

FBI: No Illegal Techniques Used in Silk Road Investigation

The Federal Bureau of Investigation (FBI) released information on Friday detailing how it allegedly discovered Silk Road and linked Ross Ulbricht to the illicit website.

The 58-page filing, submitted to the US District Southern Court of New York, offers a lengthy rebuttal to recent assertions by Ulbricht. He claimed the methods used by federal officers during the investigation of Silk Road were unlawful, and that as such, the information recovered through this process should not admissible in court.

Penned by FBI agent Christopher Tarbell, the document offered a four-point critique of the motion Ulbricht and his defense team first filed in August, though the overall tone was crafted as to suggest that the FBI is dismissive of any claims levelled against its work by Ulbricht.

Tarbell wrote:

“[Ulbricht's] various claims are bereft of any support in the law. [...] Instead, they amount to a pointless fishing expedition aimed at vindicating his misguided conjecture about the NSA being the shadowy hand behind the government’s investigation.”

The filing goes on to suggest how the government was able to identify servers used to operate the Silk Road website, along with the various steps that federal officials took to connect this information to ‘Dread Pirate Roberts’, the alias allegedly used by Ulbricht to operate the website. It also argues all Ulbricht’s claims that illegal evidence was used in the case should be dismissed.

Notably, the filing has not been without its critics, who allege inconsistencies with the government’s official version of the events.

Lawful means

Central to the FBI’s rebuttal was that agents noticed that the server’s Internet protocol (IP) address was ‘leaking’ information from the Silk Road website due to an “apparent misconfiguration of the user login interface by the site administrator”.

Exploiting this error, the FBI says, it was able to reveal certain IP addresses that were not protected by the Tor network, and were thus trace the addresses to physical locations.

Contrary to Ulbricht’s claims, the US government argues it:

• Did not need to release information about how it found the Silk Road website when it originally obtained its search warrant
• Lawfully used PEN registers during the investigation to collect routing data, as they do not require a warrant
• Was approved to search Ulbricht’s email and Facebook for evidence of wrongdoing after establishing probable cause
• Was not required to obtain a warrant to search the Silk Road server because the investigation was carried out by foreign authorities

Iceland’s intervention

The FBI further addressed the role of Icelandic law enforcement officials in the investigation, who Ulbricht and his legal team have alleged were used strategically to bypass the Fourth Amendment protections Ulbricht is afforded as a US citizen.

Offering a rebuttal of this stance, the filing argues that US authorities approached their peers in Iceland because the Silk Road server was located in this jurisdiction.

However, the FBI also indicated that any search by Icelandic law enforcement officials would not involve Fourth Amendment requirements, as this right does not apply outside the US.

“It is well established that the Fourth Amendment’s warrant requirement does not apply overseas – even to searches conducted directly by US law enforcement agents of property belonging to a US citizen,” the filing reads.

Pen registers

The FBI went on to reject the notion that it used a surveillance technique known as a pen register to track Ulbricht’s location. Rather, the filing suggests such tools were used to monitor Ulbricht’s Internet activity, and that these logs were compared to records of the Dread Pirate Roberts’ online activity to identify Ulbricht as the site’s operator.

Still, the government moved broadly to reject the idea that Ulbricht had a right to privacy in this case at all given the need for law enforcement officials to take action against Silk Road.

The report stated:

“In any event, whatever expectation of privacy Ulbricht did have in the SR server, it was plainly outweighed by the government’s legitimate need to search its contents. The government had ample evidence, easily enough to establish probable cause, that the SR server was hosting the Silk Road website.”

The filing added: “Under the circumstances, searching the server was more than reasonable. It was a law enforcement imperative that would have been a gross dereliction of duty for the government not to pursue.”

Murder-for-hire allegations are relevant

Ross Ulbricht’s defense was also handed another potential blow in the prosecution’s insistence that the murder-for-hire allegations are relevant to the case.

The filing suggests the allegations provide valuable context for Ulbricht’s state of mind at the time he was allegedly operating Silk Road, and as such, should be admissible in court.

Tarbell wrote:

“The use of violence and threatened violence to protect one’s drug empire are relevant to proving the intentional operation of a narcotics conspiracy, and such conduct may be alleged as overt acts in furtherance of such a charge.”

Notably, Ulbricht was not indicted on murder-for-hire charges in New York, though one such charge was filed in a Maryland court.

Doubts cast on FBI explanation

Despite the strong and persuasive language evoked by the FBI, critics of the filing and the plausibility of the government’s version of events have emerged.

For example, Australian blogger and hacker Nik Cubrilovic first detailed his criticism of the filing on 7th September, noting a series of issues with the reasoning listed in the report.

Cubrilovic alleged that while Tor configurations can leak information, the FBI cited an incorrect page in an attempt to bolster this claim. Further, he asserts the process detailed by the FBI is vague, adding that anybody with knowledge of Tor and hidden services would not be able to read or replicate the process FBI agents said they completed.

CAPTCHA concerns

Speaking to Wired, privacy researcher Runa Sandvik suggested the details regarding how the FBI allegedly exploited a Silk Road CAPTCHA page to establish the location of the Silk Road server were problematic.

Sandvik indicated she believes the CAPTCHA was hosted on the same server as Silk Road, meaning it would have been only accessible through the Tor network. Such a finding by the FBI, Sandvik reasons, would represent a flaw with Tor and not Silk Road’s site architecture.

Cubrilovic came to a similar conclusion in his blog post, speculating that operators of the site would have likely noticed such an error. He told Wired:

“The way they’re trying to make a jury or a judge believe it happened just doesn’t make sense technically.”

The development marks the latest update in the ongoing prosecution of Ross Ulbricht. The trial is set to begin this November.

At press time, Ulbricht’s attorney Joshua Dratel told CoinDesk that they were still evaluating the newest case filing, and that a formal response would be forthcoming.

Source : http://www.coindesk.com

BitVC Kicks Off Bitcoin Futures Platform with Trading Contest

Huobi is launching a bitcoin futures trading feature on its BitVC platform with a 10-day simulated trading competition to get users involved.

The exchange is offering prizes of funded trading accounts to the top 50 traders in the competition, which closes at 12:00 (Beijing time) on 19th September. The only catch is, winners must then turn those accounts into profits to pocket the winnings.

BitVC COO Wang Huaiqiang explained the competition’s purpose:

“We tried to design BitVC Futures to be easy for beginners to understand and convenient for experienced traders. Playing the game is a good opportunity to learn the system, practice trading strategies, and win prizes. We are very interested to get user feedback from this competition.”

Trading ‘virtual’ bitcoins

Existing BitVC users may participate immediately, but new users must register at BitVC first. A regular account with parent company Huobi’s exchange is not necessary.

At the start of the competition, users will receive 100 ‘virtual BTC’ to trade in the simulated BitVC futures market.

The name, rank, and profit of the top 50 traders will be posted and updated daily. If two users have the same profit percentage at the end of the competition, whoever has the higher trading volume will take the upper place.

The long path to winnings

One first-prize winner will receive trading accounts worth 50 BTC, four second-prize winners will get 25 BTC each, 10 third-prizers will get 10 BTC each and 35 fourth-prize winners 1 BTC each.

Winning one of these prizes is similar to gaining a place in the World Cup finals: in effect, you haven’t won yet. Next, the prize money must be used for trading for one month and winners need to demonstrate further trading talents to score the bitcoins.

At the end of that month, the principal prize amount is returned to BitVC and the winner pockets whatever profit they’ve made from trading.

If there is no profit, then no prize. Should an account fall to less than 80% of the prize principal during the month, the remainder goes back to BitVC and that user’s participation in the finals ends – at least with BitVC’s money.

For the full competition rules, see the company website.

About the company

BitVC is the Hong Kong-registered subsidiary of Huobi, which is based in Beijing.

BitVC offers more exotic trading features like margin trading, interest-bearing ‘Yubibao‘ wallets and now derivatives – a limited, fixed-term deposit offer based on a mining facility saw all subscriptions sold in the first hour when it went live last week.

While BitVC margin trades are executed on the Huobi main exchange via its API, BitVC Futures will have no direct connection other than Huobi’s inclusion in the BTC-CNY price index.

Source : http://www.coindesk.com