Quote from: repentance on February 21, 2014, 12:28:09 AM

Quote from: topynate on February 20, 2014, 08:14:14 PM

If a Japanese or American court orders MtGox not to enable withdrawals of BTC or fiat until they can prove they can cover all customers' deposits, then that is what MtGox will do. Someone just needs to convince a court to make that order. I would be shocked if a good lawyer couldn't make that case given that the collapse in price on MtGox is universally attributed to fear that they're not solvent.

MtGox may comply with an order from a Japanese court, but based on the Bitcoinica experience they're not going to comply with orders of foreign courts unless they have assets located within the jurisdiction of those courts -which at this stage seems to be Japan and Poland.

People need to remember that they're already embroiled in existing legal actions (both lawsuits and investigations related to money laundering). Regulators could shut them down at any moment even if they are solvent and other legal actions could drive them out of business long before there's a judgement on any new lawsuit.

It's worrying that Mark is unwilling to make a public statement reassuring people that MtGox has sufficient funds to cover all users balances. Whenever a company is continuing to allow money to come in but finding more and more ways to delay outgoing payments, the issue of their solvency is going to be front and centre and needs to be addressed urgently.

MtGox may have no legal obligation to make its accounts public, but an auditor's statement would certainly go along way towards reassuring people that it's financially sound. The absence of such reassurance is especially baffling given that concerns about a company's solvency can sink it even if it's viable. It's difficult not to wonder whether MtGox isn't giving that assurance because they're unwilling to make a public statement regarding their solvency which they know to be false (not sure whether this could open them up to further legal consequences in Japan).

People who believe MtGox couldn't possibly be insolvent because of the amount of revenue they've taken in are nuts. Billion dollar corporations have become insolvent in the past and we know that MtGox has spent large amounts of money on legal proceedings, had funds frozen by financial institutions, and had funds seized. We have no idea how much it may also have lost to fraud and hacks. Financial institutions tend not to make such information public because it undermines customer confidence as well as publicising the fact that they are vulnerable, but the amount of losses is not going to be zero.

I agree. If MtGox was solvent, it is highly likely they would make a statement as such. If they were not solvent, it is 99.9% likely they would NOT make a statement as such (any lawyer would recommend that.)