Mt. Gox on verge of collapse, Bitcoin plunges: Is this the end for Bitcoin?

Discussion in 'General Trading Discussion' started by admin, Feb 25, 2014.

  1. admin

    admin Administrator Staff Member

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    Check out Mt. Gox, the site of what was the largest bitcoin exchange at one point, and you'll find a blank page. The site is now unavailable, and the exchange appears to be on the verge of collapse -- a number of Bitcoin companies announced Mt. Gox was planning to file for bankruptcy after technical problems and an apparent major theft. Customers have been unable to withdraw their money since Feb. 7.

    An alleged Mt. Gox document circulating on the Internet that can't be confirmed said the company had lost more than 744,00 Bitcoins in a theft that had gone unnoticed for years.
    The news pushed the price of Bitcoin below $500 for the first time since November when the virtual currency began an ascent to above $1,100, according to CoinDesk.

    A number of Bitcoin companies including digital walllet Coinbase issued a joint statement distancing themselves from Mt. Gox, writing: "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. There are hundreds of trustworthy and responsible companies involved in Bitcoin. These companies will continue to build the future of money by making Bitcoin more secure and easy to use for consumers and merchants. As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today."

    So is that really what we are seeing? The problems with one exchange? Or is this going to be a turning point for the unregulated cryptocurrency...the beginning of the end? Yahoo Finance Editor-in-Chief Aaron Task and I discuss those questions in the accompanying video.

    Task raises the question of what happens when outspoken supporters desert Bitcoin. He points to Ryan Galt, a Bitcoin blogger who was one of the first to circulate the news about Mt. Gox. Galt wrote on Monday, “I do believe that this is one of the existential threats to Bitcoin that many have feared and have personally sold all of my Bitcoin holdings.” He wrote that this could be the end of Bitcoin, at least for most of the public.

    Meanwhile, New York firm SecondMarket announced plans to create an exchange that could bring the world’s biggest banks into the Bitcoin market for the first time, according to The New York Times. SecondMarket created a platform for buying and selling shares of companies like Twitter (TWTR) and Facebook (FB) before their IPOs.

    Alex Daley, chief technology strategist for Casey Research and former software developer and IT executive, tells The Daily Ticker that he believes it's the "end of Bitcoin as the Wild West." Daley says the problems with Bitcoin will keep businesses and banks from getting involved in the virtual currency, while he sees regulators getting more involved. Daley says Bitcoin would need to reinvent itself with effective and enforceable oversight to stay alive. For now, he advises consumers to stay away.

    http://finance.yahoo.com/blogs/daily-ticker/bitcoin-mt--gox-deleted-141110461.html
     
  2. Gomer

    Gomer Well-Known Member

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    That didn't last long....
     
  3. ursell

    ursell Guest

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    I heard about them but what is a bit coin? Why would a person invest in them?
     
  4. JR Ewing

    JR Ewing Super Moderator Staff Member

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    Bitcoin is quite risky. Too volatile and unregulated to be currency, and no way that I'm aware of to accurately value it as an investment. Purely a speculative play at this time IMO.
     
  5. canoe

    canoe Active Member

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    I don't know if anyone can call the end of bitcoin from this. What I do know is that what's going to follow from this is a long period of the dark ages for bitcoin from which bitcoin will either collapse or enter another bubble like the last two times.
     
  6. crimsonghost747

    crimsonghost747 Senior Investor

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    Just one of multiple exchanges, it's not going to cripple the whole currency. But it does show it's dangers and will most likely keep bitcoins value low for the next few months.
     
  7. yossup

    yossup Member

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    It's just one exchange so it won't cripple an entire currency. If bitcoin collapses, that means it was weak enough that one exchange was enough to lead it to collapse. If such a thing happens, it'll be more of a reflection on bitcoin, not mtgox.
     
  8. canoe

    canoe Active Member

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    This. Bitcoin is looking increasingly shaky these days and it's not just because of mtgox. You can say gox was the catalyst but there's tons of over stuff going on these days that's crippling confidence and price in bitcoin. China seems to be pulling the plug on it too.
     
  9. HeinrichM

    HeinrichM Active Member

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    This is make or break time for Bitcoin as a currency. I do think that there is still a possibility of Bitcoin surviving, but the value will most probably drop steeply. More regulation will also be introduced and this is ironic as the main aim of Bitcoin was to be an unregulated true world currency. I do not see it dying just yet but would not invest in Bitcoin for the next 6 to 12 months.
     
  10. wanderingwildman

    wanderingwildman Well-Known Member

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    I must admit seeing Bitcoin fold will make me a little happy. I never appreciate when organizations try to get out of hard work. It is proven over and over again that these get rich quick stocks never work.
     
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