Bitcoin Crashes as Major Exchange Temporarily Halts All Withdrawals

Street Insider ^ | 02/07/2014

[SeekAndFind]

Virtual currency Bitcoin is under severe pressure Friday after major exchange Mt. Gox temporarily halted all withdrawals citing issue encountered by various other bitcoin withdrawals.

The price of bitcoin is currently down nearly 11% to $703 after trading down as much as 20% earlier.

Below is the Mt. Gox Statement:

Dear MtGox Customers,

In our efforts to resolve the issue being encountered by various bitcoin withdrawals, it was determined that the increase in the flow of withdrawal requests has hindered our efforts on a technical level. To understand the issue thoroughly, the system needs to be in a static state.

In order for our team to resolve the withdrawal issue it is necessary for a temporarily pause on all withdrawal requests to obtain a clear technical view of the current processes.

We apologize for the sudden short notice. All bitcoin withdrawal requests will be on pause, and the withdrawals in the system will be returned to your MtGox wallet and can be reinitiated once the issue is resolved. The trading platform will perform as usual for the needs of our customers. 



Our team will resolve this problem as soon as possible and will provide an update on Monday, February 10, 2014 (JST).



We deeply apologize for the inconvenience caused, and thank you for your kind support and considerations. 


Sincerely,

The MtGox Team

[catnipman]

“Not all Mt. Gox’s fault btw. The governments have been causing them problems with regulation, shutting down bank lines in the U.S. and etc. “

Do you have evidence of that? The problem here seems to be a problem related to the bitcoin system itself, unrelated to exchange issues.

[Errant]

Do you have evidence of that?

Sorry, I was referring to a systemic problem created when Mt. Gox lost its direct link to U.S. banking some time back, not the current problem.

[M Kehoe]

Thanks for the link. Dr. Jeff Lewis, except for a few minor points (i.e. mining off the sea bed), knows what he is talking about.

I could be wrong, but methinks it may be a denial of service by the computing power required/bandwidth/software limits, etc. from an outside source (i.e. NSA, EU, etc.).

I'm probably wrong...

5.56mm

[BenLurkin]

Oops.

[Errant]

You are very welcome and you may be right. Whatever it is, they don’t seem too eager to fully share.

[catnipman]

http://www.vocativ.com/02-2014/bad-day-bitcoin-price-crashes-mt-gox-halts-withdrawals/

“The withdrawal issues are not the end of Bitcoin, of course. Trading will likely resume on Monday, and the price will jump back up. But for Bitcoin to ever gain real legitimacy—both from the public and the government—these types of exchange issues simply cannot happen. There are more 150,000 Bitcoin accounts, so shutdowns like this aren’t trivial. Imagine, for a moment, walking into a bank and being told by the teller that the bank can’t handle your request for $100 because their computers weren’t working. That’s essentially what Mt. Gox is saying.

Even the usually ebullient Bitcoin hivemind is taking a moment to pause and recognize the ramifications of systems errors like these. ”This a reminder that while Bitcoin may be an interesting technological achievement, as a tradable asset it is still basically a toy,” writes one commenter on Hacker News. “Crappy exchange technology combined with low liquidity is a perfect recipe for this kind of volatility.” “

[Dutchboy88]

"Not to worry. I'm sure that FDIC insurance will cover it. (sarcasm)"

Okay, that's funny. But, why not? The feds are going to fix everything else that goes wrong...why not bitcoin?

[FatherofFive]

Bitcoin on the other hand has many safe guards built into it to make it more stable than Monopoly money.

Bitcoin is a made up currency with no intrinsic value. It is a game, much like Monoploy but with less fun.

[Tijeras_Slim]

Are you enjoying the party Mr. D’ Anconia?

[mmichaels1970]

Bitcoin is a made up currency with no intrinsic value. It is a game, much like Monoploy but with less fun.

Funny thing is...every time I try to sell it, somebody buys it. Like 100% of the time. Try doing THAT with monopoly money.