Happening because 17 yr olds who know nothing about writing and deploying production grade software get their hands on Ruby on Rails and think they can do anything including handling lots of money. Thats exactly what happened here. Some months ago I invested a whole 1 btc into Bitcoinica to see what the fuss was all about. The site was so obviously programmed by some amateur that I couldnt even withdraw my 0.8 btc after taking trading losses for a while, took me a while to figure out that one withdrawal method was completely broken, so I did manage to use another to get my 0.8 btc and run, but this site was clearly heading for inevitable disaster to anyone with real professional software experience. Always try before you buy
PS also must say in my experience in the software industry, to the credit of the 17 yr olds involved, even grown adults who do know a thing or two about writing and deploying production grade software still make inexplicable mistakes like not making DB backups. S**T happens but some s**T is more likely than others.