tomorrow

on Friday

April 7-8

January 16th

Tomorrow

Good afternoon, Idiots!I’ve switcheroo’d the lineup for my posts today and, because I wanted to write about something happy, and didn’t want this one festering over the weekend.My post today is about Peter Vessenes’ company, CoinLab, and the curious bankruptcy dismissal of its first (and, I believe, only) bitcoin investment. For once, I’ve made an effort to keep my opinion out of the article and pretend to be objective until the clear break. Decide for yourself whether this dude should be the Bitcoin Foundation’s chairman for one more single day.[TBI Note: I don’t think that such a thing as “objective” journalism is possible.]Also, I’ll be attending the Inside Bitcoins Conference & Expo in New York onto learn more about bitcoin (I’ve been told I "don’t know sh*t") and what lies ahead. A great lineup of speakers has been confirmed, including Nicolas Cary, the CEO of Blockchain and Jeremy Allaire, the CEO of Circle. Session topics will include everything from bringing trust to the market, to funding the next bitcoin startup. If you’re interested in attending too, you can register here Now for the main Bit:Peter Vessenes has likely had much more on his mind than his board seat at the Bitcoin Foundation lately. Two weeks ago, he and his colleagues at CoinLab suffered a setback in court when their bankruptcy filing for Alydian was dismissed by a Seattle judge, exposing them to a potentially lengthy legal battle surrounding millions of dollars’ worth of unpaid bitcoins to customers.The woes of Alydian, an outsourced bitcoin mining company incubated by CoinLab, have been well-documented. After proudly announcing the deal in early August, CoinLab’s first investment filed for bankruptcy less than three months later. According to the filings, the company had less than $50,000 in assets and over $3 million in liabilities on its books in November.Since then, CoinLab’s attempts to auction off Alydian’s mining rigs as part of that bankruptcy process have proven unsuccessful.In fact, a scheduled auction was blocked on January 10th by Judge Karen Overstreet, who threatened to dismiss the bankruptcy outright, and voiced concern with the company’s leadership, where Peter Vessenes had seemingly taken the reigns of the company from former CEO, Hans Olson. In particular, Judge Overstreet expressed skepticism that Alydian (rather than its majority owner CoinLab) actually owned the assets that had been slated for auction, given that Alydian had no employees or office space at the time.The company’s skeletal operating structure suggested Alydian had “absolutely zero existence” and Judge Overstreet said she “wanted to make sure that when we do this world-wide advertising [of a bankruptcy auction] we are not misrepresenting to the world what we have to sell, because the integrity of the bankruptcy process is at stake.”In addition, as the Wall Street Journal's Katy Stech reported on“Judge Overstreet also questioned whether Alydian lawyers were filing accurate financial statements, and she warned Alydian officials that she would be watching to see whether they would try to buy the bitcoin mining rigs if they were put up for sale. ‘I’m not satisfied that there isn’t some hiding of information,’ she said.”It now appears that Judge Overstreet stayed true to her word to dismiss the bankruptcy.Following the dismissal, Vessenes sent private emails to a number of investors gauging their interest in acquiring the Alydian mining clusters, which he claimed were currently mining over 30 bitcoins per day as part of the BTC Guild mining pool. He expressed interest in selling up to 218 TH of mining capacity (including replacement parts for the rigs), as well as an additional ~150 TH of additional ASIC chips, including system designs and rights to the wafers.Vessenes did not respond to repeated requests for comment.***Ok, now for the unadulterated opinion: it’s not very often you see a company go bankrupt in less than three months. Yet Peter Vessenes and CoinLab either invested in a company which proved colossally inept, inappropriately attempted to exploit the existing bankruptcy process in the US or both. Don’t take my word for it. Take Judge Overstreet’s.That, my friends, is who remains at the helm of our industry’s leading advocacy group.Perseus, Atlas Launch Global Bitcoin Trading PlatformBitcoin: The future of M&A deals?What happens to bitcoin if the internet goes down?Inside North America’s $8m a Month Bitcoin Mining OperationBank of Mexico Restricts Banks from Bitcoin Use, Reports SuggestBitBeat: Coindesk Index Finds a Mt. Gox ReplacementA Simple Way Bitcoin Businesses Can Cut Compliance Costs, why I’m starting to get bullish again on bitcoin, the currency. I’m still terrified of over-regulation, but impressed at the restraint shown by figures like Ben Lawsky in the wake of Mt. Gox.Cheers,TBI