In recent months the fall out from the GOX fiasco has really weathered bitcoin. From seeing its highest price of around $1126 and a low of $394, the market has weathered some amazing news, mostly due to the fails of the largest, now defunct bitcoin exchange MtGox. MT. GOX (frequently called Mount Gox, is really an abbreviation of Magic: The Gathering Online eXchange) closed its doors and officially announced bankruptcy, stating that they had been robbed of most of their bitcoins. But since then there have been some rumblings of foul play from the like of The Idiot, and some concerns with coins that have tainted links to Mtgox. What I suspect is that Mark cut a deal.
In this deal in exchange for relinquishing control of the business (and hopefully facing criminal negligence charges as well) Peter Vessenes will drop the Coinlab lawsuit. Together, Peter and Jon will use the bitcoin collected for membership at the Bitcoin foundation to both inject funds into MTgox and give The Bitcoin Foundation a share of MTGox. They’ll rehabilitate the business and inject huge sums of money (both fiat and bitcoin) into the market to inflate themselves away from a fractional reserve bank.
This is a sweet deal for everyone because Mark will get off the hook lighter than if all of the coins were gone. Peter gets what he wanted from the Coinlab lawsuit. Jon gets the make the Bitcoin Foundation the Hero, and can show their role in helping create self-regulation. And Gox gets to become the largest exchange in the world again as the price per bitcoin pushes beyond $3000.
I know this is kinda dirty, and that is why the idiot is crying so much about it, but I also think this is what can propel bitcoin into the next big bubble. If GOX is bailed out by the foundation, it makes them look competent, shows that the foundation is more than a mouth piece, and can help legitimize The Bitcoin Foundation for these kind of crises. I also think to do this a ton of shade backdoor deals were made, and there is going to be a huge pump of capital all at the same time. This will both save GOX and push the price up several fold.
The coming days will be interesting…