MtGox Bitcoin Trace Revisited. AKA Where did all the bitcoin go?

I've been gradually refining my software approach to analysing the bitcoin traces I can generate by reading the blockchain. My little python app is now more capable so I can feed better, cleaner data to Gephi, which sorts out the muddle and creates output imagery. There's a fair way to ho yet, but I can now produce some very interesting output.

So, I decided to return to my starting point for all this and look at what happened to MtGox's bitcoin after they "demonstrated control of a vast (well, at least pretty impressive) reserve of coins in 2011 in order to counter suggestions they might not have enough reserves of "real" coin to cover people's trading accounts. It was a bit of a dog and pony show. The new traces show up some very interesting features, including one or two I still find pretty baffling.

So, here is the starting point for the trace, visualised using Gephi. Remember, each sphere is a bitcoin address, and in this case each little arrow is a transfer route that was exercised in the first 5000 transactions after the "show". The MtGox wallet shows up red, a little below centre, with numerous arrows emanating from it. The redder the node, the better it is connected to MtGox. There is quite a lot of "fan-out" even in this image, with bitcoin heading off in lots of directions.

If we pull back a bit we can see this is just part of a wider ecosystem:

Around 5000 addresses - with some noticeable "clumps" of organisation (although nothing on the scale of Satoshi Dice (discussed in a previous post). The group shown below is the biggest.

This one is Instawallet - a "we host your wallet" site that folded stating hacking and loss of coins as the reason. Another of the notable groups is shown below:

The prominent "hub" here is Coinb - another wallet service who also appear to have folded. The presence of these two  (defunct) wallet sites does prompt the question as to whether MtGox could have borrowed the bitcoin they used for the "show"? That has to remain a subject of conjecture - at least for now. Other explanations could be that Gox users withdrew funds and stored them in online wallets - or that Gox stored some of their funds there.

Now here is the strangest feature of all. You have to pull right back to see it.

See the big loop? That appears to be a string of hunderds of addresses, with bitcoin be transacted on and on, along the chain. I have no idea what the idea of this is... Is it an obfuscation method? If so, it isn't a great one as it stands out like a beacon of bizarreness. We can zoom in:

Here is the start of the loop. As you can see, the loop has two strands of addresses, which transact along the chain and also direct a little bitcoin in to the "centre" addresses. The second strand appears to be second pass around the loop - so its really a big spiral. Could be if I run more transactions through the trace we'd get more turns. If anyone can explain what's going on, I'd really like to hear.

I'm off for another round of development of the python scripts - I have a couple more additions in the pipeline that will give more detail.