Topic: Mt Gox

The Bitcoin Foundation is facing internal turmoil after former child star Brock Pierce was named executive director, leading to ten members resigning in protest. The hosts discuss Pierce's controversial past and speculate that his appointment might be part of a government effort to infiltrate or "sink" the Bitcoin community. They also mention Glenn Beck's interest in Bitcoin and Halsey Minor's plan to open an exchange.

A group of investors, including former child star Brock Pierce and a former FBI agent, is attempting to buy the bankrupt Bitcoin exchange Mt. Gox. The sudden discovery of 200,000 "lost" Bitcoins in a wallet has raised suspicions of a "honeypot" or a large-scale scam. The involvement of individuals linked to the failed Digital Entertainment Network (DEN) adds to the skepticism surrounding the deal.

The Bitcoin exchange Mt. Gox filed for bankruptcy after 850,000 bitcoins, worth nearly half a billion dollars, went missing due to technical glitches. The hosts discuss the fallout within the cryptocurrency community and the "tidal wave of negativity" on platforms like Reddit. Despite the collapse of the major exchange, the "Bitcoin community" is urged by supporters to stay strong.

Bitcoin faced significant technical challenges as a "transaction malleability" flaw led to a suspension of payouts at major exchanges like Mt. Gox. In media news, the hosts discuss a Forbes article on podcasting that mischaracterized their business model and a request from Russia Today to comment on Russian LGBT laws. The hosts decline the RT invitation, preferring to let a specialized researcher handle the topic to avoid edited misrepresentation.

Bitcoin's price volatility is discussed following congressional hearings on virtual currencies. The hosts argue that the extreme price swings prevent it from being a stable currency. They also debunk the idea that the Silk Road offered "cheap" drugs, claiming that the escrow and Bitcoin conversion costs made illicit purchases significantly more expensive than street prices.

The show addresses pushback from listeners regarding its skeptical stance on Bitcoin, which recently reached a price of $500. Critics argue that decentralized math-based assets are the future of value-for-value models, while the hosts maintain that high exchange fees and price volatility make it unsuitable for business operations. A listener email predicts a significant "flash crash" coinciding with upcoming Senate hearings on the Silk Road.

The price of Bitcoin and the dominance of the Mt. Gox exchange are briefly addressed. The exchange, based in Japan, is noted as a primary driver of market pricing for the cryptocurrency.

CNBC has added the Mt. Gox Bitcoin rate to its ticker, while the New York Times produced a video explaining the "invisible virtual currency" following an investment by the Winklevoss twins. Larry Kudlow suggested linking Bitcoin to gold to give it legal tender status. The currency currently shows a volatile 10% spread between buy and sell prices, leading to comparisons with "Beanie Babies."

The Mt. Gox exchange faced significant issues, including suspected distributed denial-of-service (DDoS) attacks and bot manipulation. Investors on Reddit shared stories of financial loss, including individuals who performed labor for Bitcoin only to see the value drop from $266 to $120. The volatility is framed as a warning to those treating the digital currency as a stable investment.

A host describes the difficulties of cashing out 143 Bitcoins as the price surged past $48, citing scams and withdrawal limits on exchanges like Mt. Gox. The discussion compares Bitcoin to a barter system or a "pump and dump" scheme, highlighting the lack of a liquid market compared to gold. Concerns are raised about the lack of privacy on the public blockchain and the inability to use the currency for practical expenses like rent.