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To See Deep Inside a Volcano, Use a Telescope Built for Quasars

How do you peer into the hidden heart of a volcano? Use a leading-edge telescope designed to track quasars and supernovae.

The next-generation Imaging Atmospheric Cherenkov Telescope, now under construction in Serra La Nave near Mount Etna in Sicily, is designed to track the highest of high-energy celestial events—objects spitting out cosmic gamma radiation, high-frequency photons with energies from 1 teraelectronvolt  to 100 TeV. (100 TeV is 1014 electron-volts; compare that to the 5 x 103 to 150 x 103 eV of a medical X-ray.)

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Tianhe-2 supercomputer

New Supercomputer Ranking Shows China Still on Top

The TOP500 supercomputer ranking, published today, shows China’s Tianhe-2 supercomputer remaining at the top of the heap, with its 33.86 petaflops/s. The number-two spot also remains unchanged: Oak Ridge National Laboratory’s Titan supercomputer, which can run at 17.59 petaflops/s.

Indeed, there is little change in the top 10 positions, with only two new names appearing in that elite group, Trinity (number 6, managed and operated by Los Alamos and Sandia National Laboratories) and Hazel-Hen (number 8, at Höchstleistungsrechenzentrum Stuttgart). These systems were both installed in 2015, as was Saudi Arabia’s Shaheen II supcomputer, which ranks 9th. The seven other supercomputers in this grouping date from 2013 or earlier.

As you’d expect with such little turn over at the top of the list, the overall rate of growth in performance of the world’s top supercomputers has been slowing in recent years. But the summed performance of the world’s 500 fastest supercomputers is still up by 55 petaflops/s over the TOP500’s June 2015 ranking.

If there’s any take-home message coming through from today’s ranking, it’s the growing dominance of Chinese supercomputers on the world’s stage. China now has 109 supercomputers in the top 500, up from just 37 in July. At the same time, the U.S. share has dropped from 231 to 200. And the European component is also down, from 141 in July to 108 now.

If China ends up using its computing behemoths to significantly advance its industrial prowess, companies in other parts of the world might well worry about the trajectory evidenced in today’s rankings. But that, of course, is a big “if.”

Not much change was reported in the world's 10 most powerful supercomputers.
1 Tianhe-2 National Super Computer Center in Guangzhou
2 Titan DOE/SC/Oak Ridge National Laboratory
United States
United States
4 K computer RIKEN Advanced Institute for Computational Science (AICS)
5 Mira DOE/SC/Argonne National Laboratory
United States
United States
7 Piz Daint Swiss National Supercomputing Centre (CSCS)
8 Hazel Hen HLRS - Höchstleistungsrechenzentrum Stuttgart
9 Shaheen II King Abdullah University of Science and Technology
Saudi Arabia
10 Stampede Texas Advanced Computing Center/Univ. of Texas United States 5,168.1


How to Design a Robot You Can Swallow

Vanderbilt engineers want to speed up the development of capsule robots. So they have created an open-source modular platform that people with limited experience can use to build their own prototypes. Biomechatronics engineer Pietro Valdastri and his team launched the platform this summer and at least one outside research group is planning to put it to work in the coming months.  

A medical capsule robot is a small, often pill-sized device that can be maneuvered inside the body after being swallowed or surgically inserted. Most prototypes use wireless electronics or magnets or a combination of the two to control the movement of the capsule. Such devices have been outfitted with cameras to allow observation and diagnosis, with grippers to take biopsies, with sensors that ‘feel,’ or palpate, the tissue, and even with mechanical needles that administer drugs. 

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Vizio Smart TVs Snitch on Viewing Habits to Advertisers

Most smart TVs connected to the Internet do not track your viewing habits by default. But the 10 million Vizio smart TVs sold so far will automatically track viewing habits and share information with advertisers from the get-go unless customers disable the option.

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Finally, the Jetpack We've Always Wanted

The reality of personal jetpacks has been a disappointment. It's almost been more disappointing than if they'd been left to science fiction, because reality hasn’t come anywhere close to living up to what comes to mind when we imagine what a personal jetpack should be like.

One of these disappointments was the RocketBelt, which had the right form factor, but let you fly for only 30 seconds before running out of fuel. The RocketBelt's inventors have been working for the last 40 years (!) on something better, and they've finally managed to develop an honest-to-goodness backpack-sized jetpack. It runs on actual jets, it (probably) won't set you on fire, and the videos make it look exactly like what we've been fantasizing about.

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Can uBeam's Through-the-Air Phone Charging System Live Up to the Hype?

UBeam, a high-profile start-up backed by some of Silicon Valley's most prominent investors, has become a tech industry sensation because of the wireless charging technology it says it has developed. UBeam's technology, promised for delivery next year, is supposed to efficiently charge a mobile phone through the air using ultrasound, keeping the phone’s batteries from being depleted even as you chat away at home or at your local coffee shop.

And according to uBeam, this plugless charging goes not just for mobile phones. On its website, the company says, “The impact uBeam will have across industries will be profound.” Meredith Perry, who founded uBeam in 2011 when she was an undergraduate at the University of Pennsylvania, says that the charging system will be as useful with household appliances as it will be with mobile handsets. It even promises to improve health care, she declares. “Because bacteria can spread via electrical outlets,” hospitals using uBeam “will be cleaner and safer for patients.”

But the company, which has yet to demonstrate a fully-functioning prototype, is now facing an onslaught of questions about whether it can actually deliver the breakthrough it is promising.

UBeam presentations give the impression that its setup can blanket an entire home or perhaps the premises of a small business with electric power that allows an electronic gadget to pick up electrical charge as easily as it can now send and receive Wi-Fi signals. But its eponymous product transmits only a small amount of power within a very limited radius—and then only if there is nothing between the transmitter and the receiver. Each room would need at least one transmitter, and possibly many more, with each device costing hundreds or even thousands of dollars—hardly the makings of the “world without wires” the company promises on its website.

Further, ultrasonics experts say it is entirely conceivable that delivering a few watts through the air to a mobile phone could easily require scores or even hundreds of watts in the overall system. This, they say, would make uBeam an environmentally questionable way of charging an iPhone or similar device.

While the company has made several technical advances involving ultrasound, “the idea that uBeam is going to eliminate the need for wires is ridiculous,” said one person with knowledge of the situation.

The company appears to have suffered an exodus of technical talent. With the exception of Perry, none of the engineers listed on uBeam’s patents are still at the company, according to their LinkedIn profiles. What's more, uBeam engineers are said to feel as though they were being pressured by management to describe the technology in more optimistic terms than they were comfortable with.

The company, now based in Santa Monica, has raised more than $20 million, with backers including Mark Cuban, Yahoo's Marissa Mayer, Tony Hsieh of Zappos, and a number of prominent venture capital firms such as Andreessen Horowitz. One April estimate gave it a possible valuation of $500 million.

Coverage of uBeam has generally been enthusiastic; this includes a recent BBC report, as well as scores of magazine and newspaper stories. Fortune asked in a headline whether Perry was the next Elon Musk. But much of the breathless media coverage has since been shown to be technically innacurate.

“The technology makes it possible for a device to move freely around a room, in a pocket or purse, while constantly charging,” said a New York Times article from last year. And an earlier Engadget item said, “the system will be able to detect a uBeam puck in the room and charge it if it's anywhere within a 20 to 30 foot radius.”

Neither of those statements are true, something even uBeam now essentially concedes.

Technical persons familiar with the company, but who would speak only anonymously, raised questions about uBeam with IEEE Spectrum. On-the-record information was also provided by physicists and engineers who, while lacking inside information about uBeam, are experts in the general technical challenges associated with ultrasound.

While popular press accounts of the company have been laudatory, comments in technical Internet postings have been far more critical.

Perhaps the most devastating critique was a 3,000 word post on EEVblog Electronics Forum, which, among other things, says that a large room will require dozens of transmitters to provide full coverage. What is striking about that last post is the nearly universal praise it has received for accuracy, with the endorsements coming both from persons familiar with uBeam as well as highly-credentialed outside experts. Several from the former category said they couldn't find any mistakes. “He did a very good job with it,” said one.

Many of the themes of the EEVblog piece were echoed by remarks from well-known ultrasound experts.

Butrus T. Khuri-Yakub is a professor of electrical engineering at Stanford and a key developer of a method for converting ultrasound into electricity. Khuri-Yakub said that Perry contacted him in 2011 to ask if the technology would be useful in the uBeam system she was contemplating. In recent weeks, Khuri-Yakub said, he had another lengthy technical conversation with Perry. Khuri-Yakub said he spoke with Perry as a professional courtesy, and that he has no relationship with the company and is therefore not privy to the details of its technical plans.

Nonetheless, he said he was “doubtful” that the company's technology could charge mobile phones at rates “anywhere comparable to what one can do with a wire connected to a wall outlet.”

Perry has often said she wants to make wireless charging as common and easy as Wi-Fi. John Fraser, a Stanford-trained applied physicist who has spent his career in the ultrasound industry, said basic laws of physics make attaining that goal extremely unlikely.

“Efficiency is not a big deal when you're transmitting a signal. You might transmit a one-watt radio signal for Wi-Fi, but your computer only needs to detect 1 microwatt to be able to process the signal. But efficiency is a very big deal when you're transmitting power. I don't think ultrasound over distances of tens of feet is every going to be practical. Even two meters is pushing it.”

In a TED speech from 2012, Perry seems to brag that she knew nearly nothing of physics before starting the company—not even how a TV remote control worked. She said the basic idea for uBeam came after only a few hours of Googling, yet portrays herself as the first person to have thought of using ultrasound for wireless power. “It seemed like an awesome idea,” said Perry. “Why hadn't the ultrasound experts thought of it before?”

Actually, they had. Many times. David R. Andrews, a physicist whose UK-based Cambridge Ultrasonics advises companies about ultrasound designs, said ultrasound experts have been thinking about using it for wireless power for many decades, but invariably dismissed it as being impractical because of well-understood laws of physics.

“You can use ultrasound to transmit power, but it's always going to be a tiny amount,” he said. “The possibility of using uBeam technology to replace all cables in the home is a pipe-dream.” He was especially critical of the notion of using a uBeam-style system to charge high-wattage household appliances, and noted that because the technology is a line-of-sight system, each room in a house would need its own uBeam transmitter, each costing, he estimated, hundreds or even thousands of dollars.

Andrews and other experts say there are numerous challenges inherent in using ultrasound for safe and efficient wireless power transmission at anything more than very short distances.

Ultrasound signals attenuate extremely rapidly in the air. William M.D. Wright, an associate professor of mechanical engineering and ultrasound specialist at University College Cork in Ireland, told IEEE Spectrum that at a frequency of 60 kilohertz, which is within the range uBeam has discussed using, a signal will typically fade to half its original strength within just three meters, and to one-tenth at 10.1 meters.

Another major challenge involves the efficiency of devices used to convert electrical energy to ultrasound, and then back again. There are a number of well-understood methods for doing so, but none of them are close to being perfectly efficient; even the best ones make no more than 30 percent of the energy available in the original form available after conversion. Each of these issues compound each other, meaning that in order to deliver a few watts of power to a mobile phone, such a system may well need to draw scores or even hundreds of watts.

According to uBeam, its plan is to provide a cover for a mobile phone, much like the protective covers commonly used today. But the entire back of its cover would function as a receiver. Transmitters could be located on walls or in ceilings. This means, though, that if a cellphone user were holding the phone up to his or her ear for a conversation, as normally occurs, a hand would be blocking most of the receiver, and thus most of the charging signals. The result would be the same if the user were holding their phone in the palm of their hand while looking at the screen.

(Oddly enough, a publicity photo released by the company, and used in scores of articles, shows a uBeam transmitter on the wall, and a hand holding a phone wrapped in a white uBeam receiver. While the picture is presumably meant to show uBeam in action, because the receiver is pointed away from the transmitter, it is likely not receiving any substantial charge at all, says Wright. So the PR photo portrays a scenario in which the pictured transmitter is, in fact, useless.)

The only public uBeam demonstration was at a 2011 technology conference; Perry showed off a proof-of-concept system delivering power across a few feet. The demo, available on YouTube, seems to have wowed the Silicon Valley types in attendance, and was the springboard for much of the company’s later fame. One prominent tech pundit in attendance wrote that the demo was “the closest I have seen to magic.”

But physicists interviewed for this article said any awe is completely unwarranted. Perry’s demonstration, “was pretty trivial,” says F. Joseph Pompei, an MIT-trained physicist whose company, Holosonics, works with ultrasound. “It was very similar to other experiments done using ultrasound to transmit low levels of power over the last few decades.”

The 2011 unit was an early prototype using off-the-shelf components. Pompei says, “one would expect” that whatever technology the company has since developed is more sophisticated. “If they can pull it off, I'd love it,” he said. “But if they are confident about the technology, they should publish their data and show the device. And the press would be well-served to reserve the accolades for uBeam until after something has been shown that really works.”

A staple of press accounts about uBeam is the unattributed report claiming that the company is negotiating major technology deals with the likes of Starbucks. One account from March said a pact with the coffee company was “especially close to signing.” No such deals have been announced, and one of the questions uBeam declined to answer was whether it was the source that planted these rumors in the first place. Starbucks declined to discuss the matter.

While uBeam has received a great deal of press attention, the company seems to work with the media only on it own terms.

After IEEE Spectrum began making inquiries about the company, a uBeam spokesperson suggested it might be willing to share certain unspecified internal data that it said would back up its claims—but with the stipulation that the data not actually be published.

The offer was withdrawn, though, when the company discovered that IEEE Spectrum was using LinkedIn to approach ex-uBeam employees for possible interviews, a relatively common practice for reporters.

"What would you possibly gain from reaching out to a former executive assistant with no engineering background?" asked a spokesperson in an email to a Spectrum reporter. “This isn't TMZ, this is IEEE.”

IEEE Spectrum e-mailed uBeam several lists of questions about the issues being raised in this article, but the company declined to answer any of them.

In an e-mailed response, a uBeam spokesperson said the questions had “a negative slant,” and added, “If you want to write about real science, for a scientific audience, you would reach out to us and work with us in a collaborative rather than offensive way.”

Over the weekend, uBeam provided an interview to a Silicon Valley tech blog in which it provided a few details that it had previously withheld—saying, for example, that its system is designed to deliver a minimum of 1.5 W, and that a single transmitter could operate at distances of up to 4 meters. (That's much less power than mobile phone owners are used to; the USB converters sold by Apple range from 5 to 12 W.) UBeam told the blog that it would begin demonstrating its system next year.

Engineering experts were not particularly impressed with the new details. David W. Greve, with the department of electrical and computer engineering at Carnegie Mellon, wrote in an e-mail that, “What's missing is HOW they plan to achieve the required sound intensities and receiver efficiency. I am not suspecting that these are unachievable; what I am not sure about is how practical, efficient, and economical the transducers can be. My gut feeling is that a system of this sort will not be very efficient and will be practical for at best limited applications.”

The recent TechCrunch article also quoted two ultrasound experts in an apparent attempt to bolster the company's claims. But what was most striking about their quotes is how little they actually said in support of uBeam.

Both men, Matt O’Donnell, a medical ultrasound expert at the University of Washington, and Babur Hadimioglu, a Stanford-trained electrical engineer who works in the ultrasound industry, were quoted saying essentially the same thing: that wireless power via ultrasound is possible—an issue never known to be in dispute. However, neither provided any opinion about whether uBeam could in fact engineer and then effectively commercialize the system it is promising.

In an interview with IEEE Spectrum, both men said they had been contacted recently by uBeam last week about being willing to provide some sort of a press statement; Hadimioglu said the company told him that it was expecting negative publicity soon. He said he wasn't familiar with the company, and his research into uBeam simply involved reading its website.

“As a scientist, I want to be open-minded and not too skeptical,” Hadimioglu told IEEE Spectrum. “But I am an applied technologist, and know that uBeam is facing a very challenging problem, to say they least.”

One noticeable change evident in the recent TechCrunch article is that uBeam now appears to be far more modest in the claims it is making to reporters. A September piece in the same blog said uBeam, “could power up your phone while it’s in your pocket when you’re at a cafe,” something company critics said was simply impossible because of the line-of-sight nature of ultrasound waves. The latest post concedes the point, saying, “the system requires a line of sight and can’t charge through walls or clothes.”

While she declined to answer IEEE Spectrum's questions, Perry frequently posts to Twitter. Following the publication of the EEVblog post, she wrote a series of revealing tweets.

She started with a quote she attributed to Mahatma Gandhi: “First they ignore you, then they laugh at you, then they fight you, then you win.” She went on to say, “You just can't win with people that want to bring you down,” and then added “but I got news for you guys. I'm a resilient SOB and you're going to have to nuke me to kill me.”


Researchers Achieve Long-Distance Teleportation and Quantum Entanglement With Twisted Photons

During the past three decades, the theory of quantum communication and computing has progressed with the addition of new protocols and algorithms.  However, implementing these theories in order to design a future quantum Internet is a continuing challenge because actually building the technology required for processing quantum information, such as the still elusive quantum repeater, has proven extremely difficult.   

Anton Zeilinger, a researcher at the University of Vienna, is one of the pioneers in quantum communication; his group in Austria realized the first teleportation of photons in 1997. On Monday last week, Zeilinger and his team published two papers in the Proceedings of the National Academy of Sciences (PNAS) that report a breakthrough in the teleportation of entanglement. They generated entanglement between independent qubits over a record distance of 143 kilometers, linking the Canary Islands of La Palma and Tenerife. They also achieved entanglement of twisted photons across a distance of 3 km.

For the teleportation of entanglement, also known as entanglement swapping, the researchers made use of a curious phenomenon. It’s possible to entangle two photons by performing a joint measurement on them, known as a Bell-state measurement. These photons are then linked, and by switching the polarization of one of them, for example from up to down, the other photon will have its polarization switched from down to up. Assume you have two pairs of entangled photons, "0" and "1" in the receiving station and "2" and "3"  in the transmitting station. Both entangled pairs are completely unaware of each other; in other words, no physical link exists.  Now, assume you send photon 3 from the transmitter to the receiver,  and perform a Bell-state measurement simultaneously on photon 3 and on photon 1. As a result, 3 and 1 become entangled.  But surprisingly, photon 2, which stayed home, is now also entangled with photon 0, at the receiver. The entanglement between the two pairs has been swapped, and a quantum communication channel has been established between photons 0 and 2, although they’ve never been formally introduced.

Entanglement swapping in conjunction with quantum memory will be an important component of future secure quantum links with satellites, says Thomas Scheidl, a member of Zeilinger's research group. 

According to Mario Krenn, a member of Zeilinger’s research group, the team is working with a group at the University of Science and Technology of China on a satellite project. Next year, when the Chinese Academy of Science launches its Quantum Science Satellite (which will have an onboard quantum source), the satellite and ground stations in Europe and China will form the first space-Earth quantum network. Says Krenn: “You would create two quantum channels between the space station, one linking with Europe, and one with China. You can combine the results and obtain 100 percent secure quantum communication.”

Krenn is a coauthor of the second PNAS paper, which describes the entanglement of twisted photons despite having been located in buildings that are 3 km apart. A year ago, we reported in IEEE Spectrum the Vienna team's experiment with the transmission of another quantum state of light, orbital angular momentum (AOM), over a similar distance. “Last year was a necessary step, and it was successful,” says Krenn. “And now we were able to show that on the single photon level, each photon can keep information in the form of orbital angular momentum over a large distance, and can be entangled even after three kilometers.” 

Photons can only exist in two polarization states or levels, up and down. But the number of orbital angular momentum states is, in theory, unlimited, explains Krenn. “In the lab, we have shown that we can create a 100-dimensional entanglement—up to a hundred different levels of the photons can be entangled.” 

To find out whether entanglement with OAM modes can be achieved across a turbulent atmosphere, the researchers created polarized photon pairs in the sender. Both were sent (one with a delay) to the receiver via a 30-meter optical fiber. Before being sent to the receiver, the photon sent without delay had its polarization state transformed into one of two OAM states that corresponded to the original polarization state. By performing separate but simultaneous measurements of the quantum states of both the slightly delayed photon in the sender and the photon detected in the receiver, the researchers found that the two photons were entangled. 

“We were sure that entanglement took place,” says Krenn. “The measurements were prepared in such a way that there was no classical [not quantum] bypass of information.” Krenn notes that the measurement results could not influence each other because the distance was too large even for a speed-of-light signal to traverse the stations when the first one was measured. 

The control of twisted quantum states is much more complicated than the control of polarization states, but the possibility of being able to entangle photons on multiple levels is worth the effort, says Krenn.


Electron Map May Show the Way Toward High-Temp Superconductivity

The phenomenon known as high-temperature superconductivity is apparently unexpectedly linked to a 3-D arrangement of a superconductor's electrons.

Fully mapping how electrons behave in superconductors under a variety of conditions could aid in the design and development of new superconductors that work at warmer temperatures.

Superconductors conduct electricity without dissipating energy. They depend on electrons not repelling each other as they do in ordinary materials, but instead on electrons forming delicate couples known as Cooper pairs, which can flow without resistance.

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BAE Systems, UK Gov't Invest $120 Million in Skylon Space Plane Engine Prototype

Part of the reason that getting to space is so stupendously expensive is that we go about it very inefficiently. We use rockets, which spend the vast majority of their thrust to lift their own fuel and oxidizer—neither of which we care very much about, at least not as far as the end product of getting mass into orbit is concerned. Airplanes, on the other hand, are very efficient, because they take advantage of air, which helpfully provides both lift and as much oxidizer as an engine can suck down.

For the last quarter century or so, a British company called Reaction Engines has been making slow, steady progress toward a hybrid system that has the potential to bind aircraft and spacecraft together. Reaction’s Synergetic Air-Breathing Rocket Engine (SABRE) could power a safe, efficient, and very cool looking single-stage-to-orbit vehicle. It's an enormous technical challenge, but one that may now be realistically solvable thanks to massive new investment from BAE Systems and the British government. BAE just ponied up £20.6 million for a 20-percent stake in the company. And with £60 million in grants coming from the UK government, the company thinks it should have the resources it needs to stage a full-scale ground test of SABRE by 2020, and unmanned test flights around 2025. ​

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The Mt. Gox Bitcoin Debacle: An Update

This story was corrected on 4 November. Due to an editing error Kraken’s response to our request for an interview was omitted.

More than 18 months after the MtGox bitcoin exchange filed for bankruptcy in February 2014, little is still known about what happened to the 850,000 missing bitcoins. The now defunct Tokyo-based company claimed hacker malleability attacks—illicit alterations of transaction ID numbers—were responsible for the disappearance. MtGox users who traded the virtually currency for fiat money suspected fraud.  Whatever the reasons, the fallout appears to have been a financial calamity for Bitcoin investors: the value of a bitcoin dropping from a peak of over $1,000 prior to the exchange’s collapse to around $232 today.

Although investigators remain tight lipped about their findings, Tokyo Metropolitan police took Mark Karpeles, the CEO of MtGox, into custody in August on charges of manipulating company accounts and stealing from exchange users. Then on 11 September prosecutors issued a warrant for his arrest, accusing him of embezzling US $2.7 million of clients’ money. Karpeles, 30, a French national, has reportedly denied wrongdoing.

Yet these charges represent only a tiny fraction of the 850,000 bitcoins worth around $200 million at today’s exchange rate, or about half-a-billion dollars at the time of the MtGox collapse. So the wait to hear what really occurred continues.

“It is only natural for law enforcement, trustee and the forensics team not to give reports when there is an ongoing criminal investigation,” says Pauline Reich, director of Asia-Pacific Cyberlaw, Cybercrime and Internet Security Research Institute in Tokyo. “It will take time. Patience is needed.”

Investors had hopes raised for a quicker explanation when Kraken Bitcoin Exchange, a leading San Francisco-based exchange, was selected last November by the trustee to help the investigation and aid in the distribution of MtGox’s remaining assets to creditors. So far, though, Kraken has remained silent and refused to comment for this story. In September Kraken said it would not release any additional information.

One entity not happy to wait for answers is WizSec, a bitcoin security firm established last year in Tokyo by three former MtGox bitcoin investors. The company began conducting its own independent investigation in spring 2014 based on leaked MtGox transaction data published online by hackers, non-public leaked sources, interviews with former MtGox staff and others connected with the company.

Kim Nilsson, head of WizSec, spoke to the foreign press in Tokyo on 14 September and shed some light on the difficulties the authorities are facing, though he pointed out that because a substantial portion of his sources are unverifiable leaked data, he could not claim it to be one hundred percent reliable. However he believes it likely gives a good indication of the state of MtGox customer accounts at the time. 

“MtGox had very bad accounting to the point where it might have been non-existent,” said Nilsson. “This has left the case full of holes, which the police will have to extrapolate to fill.”

A major problem, he said, was that clients’ bank accounts and company accounts had been comingled, at least early on after the company’s launch in 2010. “So company funds and clients’ deposits were stored in a single account and used for company expenses.”

WizSec has published two reports on its findings, the latest this February. According to the report’s executive summary:

 Most or all of the missing bitcoins were stolen straight out of the MtGox hot wallet over time, beginning in late 2011. As a result, MtGox was technically insolvent for years (knowingly or not) and was practically depleted of bitcoins by 2013.

Christian Decker of the Swiss Federal Institute of Technology Zurich, and co-author of Bitcoin Transaction Malleability and MtGox study [pdf] with colleague Roger Wattenhofer disagrees.

“While it’s possible that at the change of ownership [when Karpeles purchased the exchange around March 2011], MtGox was not completely covering its liabilities, it is very unlikely that it was missing a major part of its funds,” Decker told Spectrum. “This is backed by the fact that some of the bitcoins sold on the platform did not enter the Bitcoin economy until later, i.e., they had not been mined then and couldn’t have been stolen then.”

The malleability study also discounts MtGox’s claim that malleability attacks were responsible for the loss of 850,000 bitcoins. The study concludes “…barely 386 bitcoins could have been stolen using malleability attacks from MtGox or from other businesses.”

But there are areas where the experts are in full agreement. “The main problem with MtGox was not with the bitcoin technology, but with how the company was run,” said Nilsson. “It doesn’t matter if you use the strongest bank vault in the world if you leave the keys out.”

Reich concurs. “This is about the bookkeeping at MtGox and not about the technology.”

“The alleged theft is due likely to insecure handling of funds by MtGox in their internal systems,” says Decker. “This would have been the case even if their allegations that transaction malleability was to blame, since they were using faulty network nodes internally.”

As for future expectations, “I believe the technology that powers bitcoin is strong and solid and will definitely make it into the financial industry before the (bitcoin) currency itself does,” said Nilsson. And Decker notes that while Bitcoin technology is still new and experiencing growing pains, “Academia and the industry are continuously working on improving the security of systems built on top of it.”


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