Bitcoin Trading Technology In Question As Currency Dives After Glitch.
Yesterday, the price of Bitcoin, the innovative yet secretive virtual currency reportedly used by some traders for illicit activity, dived by 16 per cent after exchange Mt Gox said there was a “bug” in the Bitcoin software. The Bitcoin Foundation has rejected the comments, insisting that Mt Gox experienced its own technical problems and was not ready for a well-known messaging risk.
The issue affects transactions from a Mt Gox account to an external Bitcoin address, and not currency withdrawals. It allows someone to use the Bitcoin network to alter transaction details, making it appear that withdrawals to Bitcoin wallets have not occurred and enabling the currency to be resent – potentially allowing someone to make a withdrawal twice for only one charge.
Mt Gox said in a statement: “The problem we have identified is not limited to Mt Gox, and affects all transactions where Bitcoins are being sent to a third party.” It has suspended all withdrawals “until this technical issue has been resolved”.
The latest problem may – to some onlookers – demonstrate the risks of running cutting edge, highly adapted systems on a vast financial scale. It has even prompted an unexpected admission from high profile members of the Bitcoin community that the core technology in use is immature.