Critics said the failure of the
The value of a bitcoin tumbled more than
The closing of MtGox "is a significant setback for the Bitcoin community", said
"This exposes its structural flaws," Williams said.
"It shows self-regulation doesn't work. When there is big money on the table, there is an incentive to cheat and consumers are 100 percent exposed."
"If people start to panic and think this is a sign of general problems in the bitcoin economy, it becomes a bit like the 2009 financial crisis," he said.
"You can get a general self-reinforcing panic which sets in."
Farrell said Bitcoin was now in a "fragile situation" and needed to get through the current crisis to survive. But he did not see Bitcoin expanding beyond being a "hobby currency".
"The network was always at risk, but now with a sudden drop of over 20 percent, a tipping point is being approached which would derail the entire system," Leeds said.
"The disturbing news from
But defenders of Bitcoin expressed confidence in the virtual currency, which is based on a computer algorithm designed by one or more anonymous people in 2009.
"This is not the end of Bitcoin," said
The heads of the major operating Bitcoin exchanges issued a joint statement saying the collapse of MtGox was a "tragic violation of the trust of users" that "does not reflect the resilience or value of bitcoin and the digital currency industry".
"As with any new industry, there are certain bad actors that need to be weeded out," the statement said. "We are confident, however, that strong Bitcoin companies, led by highly competent teams and backed by credible investors, will continue to thrive, and to fulfil the promise that Bitcoin offers as the future of payment in the internet age." - Sapa-AFP
Most Popular Stories
- Dmytro Firtash, Ukrainian Billionaire, Arrested in Vienna
- Obama, Ukraine Discuss Russian Incursion in Crimea
- Obama's Overtime Initiative Praised, Condemned
- Republicans Warn Obama on Immigration
- Liberty Media Drops Sirius Bid
- West Readies Harsh Sanctions Against Russia
- Drake Wins Big MTV's Woodie Awards at SXSW
- Uli Hoeness, Bayern Munich President, Gets Prison for Tax Evasion
- Lady Gaga Roasts Self on Spit at SXSW
- Calumet Photo Files for Bankruptcy