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Technology / AI and automation

Mt. Gox flaw ‘not fatal’ for Bitcoin

The closure of the world’s biggest Bitcoin exchange after an apparent loss of $350m will not damage the cryptocurrency in the long term, an expert believes.

Mt. Gox was today pulled offline for at least a month after the discovery that hackers had taken advantage of a flaw to steal 744,408 bitcoins from people’s digital wallets, according to an apparent leaked document.

The lost coins amount to around 6% of the overall 12.4m bitcoins currently in circulation, and the news has rocked the Bitcoin community, precipitating a drop in the total value of the digital currency from its January-high of $14.5bn to just $6.9bn.

But the co-founder of Elliptic Vault, the world’s first insured cold storage service for Bitcoin, insisted the cryptocurrency will recover.

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"In the long term I don’t think it’s damaging at all," Tom Robinson told CBR. "It’s one business that’s lost customer funds. It’s just coincidence that it happens to be a Bitcoin company."

Mt Gox CEO Mark Karpeles is set to step down from the exchange, after admitting earlier this month that his company had failed to keep up with the pace of Bitcoin code updates.

Critics of the exchange say the problem is not with the Bitcoin code, but in Mt Gox’s implementation of it.

This article is from the CBROnline archive: some formatting and images may not be present.