That is essentially correct. A couple of nitpicks:
1) MtGox traded in only one cryptocurrency Bitcoin. It had multiple sovereign currences against which Bitcoins could be traded. There were continual rumors that MtGox was going to expand its cryptocurrency offerings to, say, Litecoine, but that never happened. 2) The exchange to ask you for your private key when they create "your" wallet. They create their own private key and you trust them to wire cryptocurrency from that wallet to your wallet (your private key) at your request. Until that transfer is done you don't really possess the privatekey.. On Wed, Feb 26, 2014 at 4:04 PM, Craig <[email protected]> wrote: > On 02/26/2014 03:38 PM, Edmund Storms wrote: > >> OK Craig, if the bitcoin can be stored in a person's computer, why are >> people upset that they lost money from MtGov. How is that loss possible? >> Did they fail to transfer the coin to themselves? In any case, for me to >> sell my coin, I need an exchange that has money and access to my bank >> account. Are you saying that I can give any of the exchanges my private >> key and have them convert the bitcoin into money that appears in my bank >> account? >> > > Right, the people who lost bitcoins on MtGox were people who kept those > bitcoins in a MtGox account, generally for the purpose of trading them on > MtGox' exchange. MtGox was an exchange where bitcoins could be bought and > sold for various currencies, including other crypto-currencies. > > Never give anyone your private key. When you want to sell your bitcoins, > you send them to an account maintained by the exchange. Then you can trade > the bitcoins for money, and then withdraw the money. Generally, an exchange > will not wire you money until you verify your identity, in line with the > know your customer rules. > > Craig > > >
