BitGo and BitFinex are both very keen to point out that none of the blame lies with BitGo. Finex apparently had a custom setup with BitGo, unlike any other BitGo customer. [...]
Perhaps there is something else going on and I haven't read about it or it isn't public knowledge?
Perhaps there is something else going on and I haven't read about it or it isn't public knowledge?
Jeesh, for people who seem to value outside-the-box thinking, you guys are thinking smack-dab inside the box.
BitGo implementation was used so that BFX could continue p2p lending (needed for leverage trading), without having to commingle the customer funds in a wallet it controlled (reason for the CFTC fine they paid).
So BitGo did exactly what was asked of it, allowing BFX to keep doing what it was already doing, without the need to become a licensed futures exchange.
I don't see how separating wallets by individual depositor requires ignoring proven security methods. Are you suggesting that security and appeasing the CFTC are mutually exclusive?