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Old 02-25-2014, 05:08 PM  
420
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Quote:
Originally Posted by Sunny Day View Post
Since I'm so dumb, I'll have to explain it in simple terms. Hopefully your smart brain can follow.

I buy 1BC from MtGox for $100 + fees. MtGox then holds my BC. In the mean time, on other exchanges BC has risen to $150., but MtGox hasn't sold any more BCs, so they only have $100 in reserve. I decide to sell my 1BC for $150. MtGox can't cover the sale.

Simplistic view, but when you multiply that by a fast rising commodity and lots of sellers wanting to cash out, that what happens.
I think you're missing the point. Gox isn't a retail store that has to buy inventory to sell. They're just the middle man between 2 people buying and selling bitcoins. Gox makes about 50 cents for every $100 spent regardless of the price of bitcoin.
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