Tags: mt gox | bitcoin | virtual currency | digital money

Mt. Gox Bitcoin Exchange Goes Offline as Peers Lash Out

Tuesday, 25 February 2014 08:26 AM

Mt. Gox, the Bitcoin exchange that halted withdrawals this month, went offline as industry peers distanced themselves from the Tokyo-based company in an effort to defend the virtual currency.

Efforts to reach the www.mtgox.com website directed users to a blank white page, a day after Mt. Gox Chief Executive Officer Mark Karpeles resigned from the Bitcoin Foundation, a key advocacy group for the digital money.

“While we are unable to comment on whether or not Mt. Gox’s business operations employed operational best practices and reasonable accounting procedures, we can assure the public that the Bitcoin protocol is functioning properly,” the foundation said in an e-mailed statement.

Mt. Gox, one of the first exchanges, said this month that it identified a bug that enables people to withdraw the same Bitcoins more than once, leaving it vulnerable to hackers. Prices quoted on the exchange plunged on speculation that account holders wouldn’t be able to get their coins back.

Mt. Gox didn’t immediately reply to a phone message and e-mail seeking comment.

Bitcoin tumbled 15 percent to $464.66 at 7:46 a.m. London time, according to the CoinDesk Bitcoin Price Index, which averages exchange prices. That’s down from as high as $1,151 on Dec. 4.

Coinbase Inc., a Bitcoin wallet operator, criticized Mt. Gox today and sought to reassure users of the virtual currency that their funds are safe.

Trust Violation

“This tragic violation of the trust of users of Mt. Gox was the result of one company’s actions and does not reflect the resilience or value of Bitcoin and the digital currency industry,” Coinbase said in a joint statement on its website with peers Kraken, BitStamp, Circle, and BTC China.

“As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today,” Coinbase said in the statement.

The troubles at Mt. Gox are the latest setback for Bitcoin after authorities in Russia, China and Israel sought to restrict the digital money, while the U.S. seeks ways to prevent money- laundering and illicit sales without killing it.

Bitcoin was introduced in 2008 by a programmer or group of programmers under the name Satoshi Nakamoto and has since gained traction with merchants around the world. The digital money has no central issuing authority, and uses a public ledger to verify transactions while preserving users’ anonymity. Since at least 2011, enthusiasts have been trading Bitcoins for dollars and other traditional currencies, and in early 2013 Mt. Gox was one of the biggest exchanges.

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Mt. Gox, the Bitcoin exchange that halted withdrawals this month, went offline as industry peers distanced themselves from the Tokyo-based company in an effort to defend the virtual currency.
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2014-26-25
Tuesday, 25 February 2014 08:26 AM
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