An article titled "Researchers find that one person caused bitcoin to spike from $150 to $1,000 in 2013" (here) at CNBC discusses a paper titled "Price Manipulation in the Bitcoin Ecosystem" (here).
This article says about the paper that
They found that a majority of the price manipulation happened due to two bots with "??" listed as the name of the user country. They named these bots "Markus" and "Willy."
Markus bought and sold bitcoin at seemingly random prices and did not pay transaction fees. Upon further review, they found reason to believe that Markus was not actually paying for the bitcoins he was receiving. Markus acquired a total of 335,898 bitcoins and was active from February 14th, 2013 until September 27th, 2013.
On p.7 of that paper the authors wrote that
In the end, we have concluded that Markus did not actually pay for the bitcoins he acquired; rather, his account was fraudulently credited with claimed bitcoins that almost certainly were not backed by real coins. Furthermore, because transactions were duplicated, no legitimate Mt. Gox customer received the at currency Markus supposedly paid to acquire the coins.
Markus began buying bitcoin on 2013-02-14 and was active until 2013-09-27. He did not pay for the bitcoins he acquired nor did he pay fees for the transactions.
I am mainly interested in how a duplication of transaction would lead to the seller not getting paid.
This is not explained in the paper as it mainly focuses on how the activity by the bots drove up the price of BTC at Mt. Gox and elsewhere.
Questions:
- Isn't the purpose of the blockchain to avoid issues with transaction integrity, such as duplicate transactions?
- How would duplication of a transaction lead to the seller not getting paid?
