Post
Topic
Board Service Discussion
Re: BEWARE - MTGox Stealing Your Money!
by
TimJBenham
on 10/08/2013, 07:40:35 UTC
Of course they are willing to do so, the more people buy their already overpriced bitcoins and sold them on Bitstamp, the larger the price gap between the two exchanges, the more profit they could make from doing arbitrage between the two. As the only USDs that could leave MtGox now is their own dollars, they have a monopoly on doing this. They could earn 10% profit doing every round of arbitrage. With this rate and without competition, they could double or even triple their money in a few months. Very sound business plan from MtGox!

Doesn't make sense. For this to work people have to keep depositing fiat at MtGox. Otherwise they are limited by whatever fiat customers had on deposit at the time the withdrawal freeze started.