Skip to comments.Bitcoin virtual currency is on verge of collapse
Posted on 02/25/2014 8:42:32 PM PST by BenLurkin
In a stunning blow to a novel way to buy products and services, the world's largest exchange for trading bitcoin currency shut down Tuesday, triggering a massive sell-off and sending many prospective investors away perhaps for good.
"This is extremely destructive," said Mark Williams, a risk-management expert and former Federal Reserve Bank examiner. "What we're seeing is a lot of the flaws. It's not only fragile, it's fragile as eggshells."
The mysterious circumstances that triggered the failure of the exchange, Mt. Gox in Tokyo, is only adding to the renewed anxiety over the virtual currency, which just a month earlier had been gaining momentum and supporters.
(Excerpt) Read more at latimes.com ...
Amazed it lasted this long.
Someday the dollar will have the same fate.
I wonder who destabilized the currency? Whoever they are, they must have a lot of computing power and experience in decryption algorithms. Hmmm.... I wonder who that would be?
"It's not only fragile, it's fragile as eggshells."True. But so is the dollar. And the legitimacy of the government, for that matter. Both have value only because people believe they have value.
Live by the Byte, die by the Byte.
Suprise, suprise, suprise! :-)
Based on what I heard on CNBC today, I think it was done using more conventional hacking.
The cyber accounts somehow evaporated.
And in other news, the price of magic beans fell off sharply today...
NOTHING beats the good old American BUCK!
(And I’m not talking about deer, either!;)
Never understood the whole bitcoin concept and therefore never participated. Mayhap a good thing on my part.
I think it was just a scam to make a lot of money quickly. Those who made their money probably sold off everything quickly.
Buying opportunity fer shore! (buy lo, sell hi,D’UH!)
Note the source: LA Times. I’m sure this article is just as trustworthy as one about guns or gun owners.
“Many Bitcoin backers insisted there was a silver lining to the collapse. Bad firms like Mt. Gox would be weeded out and replaced by trustworthy ones that would make bitcoin more credible and secure, they argued.”
Exactly. Since everyone knows that Mt. Gox was the only bad player and now that it as been weeded out, all things bitcoin will now be hunky-dory for all of the rest of eternity.
I’m sure the federal reserve or any central bank wants the competition so they just destroy them like they destroy the metals market daily to keep their paper scam going.
4 centuries ago it was Tulip Mania. Some things never change.
Stupid idea anyway and I’m surprised it lasted this long...
Think of BitCoin mining as finding prime numbers. Ok, you start off early and there are tons -- numbers 2, 3, 5, 7, ... you register your discovery and only you has access to those numbers. Now others want to find prime numbers too, and they do, but they can't register your numbers, they have to search harder ... the more people into the mix the harder it is to find the unique numbers that make up the BitCoin algorithm.
Each number found is totally unique, and it is registered. Its value is assigned what the market thinks it is worth. The fact that this exchange closed, I'm wondering if there was external pressure to do so.
I really disagree. Explanation above. Not convinced of having government in control of the currency is in the best interests of the people.
....as it rebounds over $100 today
Many Bitcoin backers insisted there was a silver lining to the collapse. Bad firms like Mt. Gox would be weeded out and replaced by trustworthy ones that would make bitcoin more credible and secure, they argued.
That sounds like the typical Libertarian/Austrian crowd. The same people who were crowing a few weeks ago about what a success Bitcoin was.
It ought to have a valuation based on something real and tangible...
Like the American Dollar!
Ha! — Exactly so!
Well...it wouldn’t be a government entity...would it? Oh no, they’d never do such a thing.
So maybe it is a cabal of bankers....but no, they are so respectable, they’d never do this.
Who can it be?
Did George Soros collapse this??
I’m thinking you are right on.
Agree. I think we will still be investigating this.
You aren’t kiddin.... I just looked at its pricing.
Once again today its got 22% variance on the day.
PT Barnum Was Right.
That has gotta bewilder the hand wringers - how is this kind of support possible?
Is Gold truly different? I understand it also has industrial uses, but I don't believe that is significant in setting its value.
In related news, my herd of Unicorns escaped from the barn last night. Dang.
Which is one of the classic definitions of money:
Functions of Money
Specific functions (mostly micro-economic)
Unit of account (abstract)
Common measure of value (abstract)
Medium of exchange (concrete)
Means of payment (concrete)
Standard for deferred payments (abstract)
Store of value (concrete)
General functions (mostly macro-economic and abstract)
Framework of the market allocative system (prices)
A causative factor in the economy
Controller of the economy
Since I believe that no State shall make any thing but gold and silver coin legal tender in payment of debts, I’m not at all surprised.
That which the government cannot control, it will regulate.
That which the government cannot regulate, it will destroy.
Such is the nature of a totalitarian socialist government.
It’s been around longer than an average 3rd world country.
Its downfall was the bubble and it still may still survive to fulfill its original purpose as a coin purse to make purchases to small for credit cards.
The sell price on btc-e today is about the same or a bit up from yesterday.
Last year, I took out a 4th mortgage on my house and invested it all in Bitcoins so I could get away from the evil banksters. If I lose my investment, can the mean Republicans stop me from getting my government bailout?
Yesterday I checked it was at 540...
I just checked today since I seen the LA times report 587...
I think they try to compare volatility with that of the stock market...apples vs oranges, the only things they have in common is they are both fruit and grow on trees.
There may be some similarities but they are different markets, but the fruit cannot be compared.
AFAIK, that is true. What happened wasn’t a data corruption/tweak issue. Gox left some wallets exposed, and hackers were able to get access to them and steal the coins.
(route the coins to another address)
It’s like if you leave your bank acct info and your password on your machine, and somebody steals your laptop and then drains your bank account, well, that’s not the banks fault and nothing about the way the bank does its business operationally has been compromised or broken.
"There's a sucker born every minute."
If Bitcoin seeks government help it may have a chance for survival.