Investors Worried After Largest Bitcoin Exchange Goes Dark
In a packed news conference,
"Regarding the concerned issue, I am aware that the related ministries, such as the
The sudden disappearance of Mt. Gox - once one of the largest Bitcoin exchanges - has dealt a blow to the credibility of the virtual currency. Earlier this month, Mt. Gox imposed a ban on withdrawals. On Sunday, CEO
Reports emerged that the company had lost more than 750,000 Bitcoins due to what was called transaction malleability. Hackers were able to discover that they could track Mt. Gox's software by creating a Bitcoin transaction and then changing its identifying codes. Funds were taken from Mt. Gox, but because its computers were looking for the old identifying code, the losses went unnoticed.
Several other Bitcoin exchanges issued statements Tuesday that said they are working to reestablish the currency's credibility.
Nonetheless, Bitcoin's future remains questionable.
"I think what we'll see from this is that governments will try and enforce some kind of regulation because, as we've discovered, there's around
"One of two things will happen: either the Bitcoin community will convince us that it is a one off, and a new form of maybe partially regulated exchange can solve these problems and take the good and get rid of the bad, or people will start losing faith," said Cohen.
Several large firms- including
As of this writing, Bitcoin's value was nearly back to where it was when the Mt. Gox crisis began. It may be that Mt. Gox's will help Bitcoin in the long run by eliminating an unsound player from the virtual currency game.
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