Bitcoin Buzz | Panic selling grips Bitcoin markets after trading platform suspends withdrawals indefinitely
Japan-based Mt Gox suspends Bitcoin withdrawals over software flaw that could allow users to defraud exchanges
Panic selling gripped Bitcoin markets after one of the world’s top trading platforms suspended Bitcoin withdrawals indefinitely, citing a software flaw that could allow users to defraud exchanges.
The price per Bitcoin dropped some 20 per cent to US$535.55 on Monday immediately after the Japan-based exchange attempted to explain its temporary halt last Friday was related to problems at the core of the technical set-up that “affects all transactions where Bitcoins are being sent to a third party”.
“We believe that the changes required for addressing this issue will be positive over the long term for the whole community,” the company said in a statement. “As a result we took the necessary action of suspending Bitcoin withdrawals until this technical issue has been resolved.”
Cash withdrawals are unaffected by the halt.
The beleaguered Mt Gox company said it had detected unusual activity related to “transaction malleability” – or a technical flaw – in the Bitcoin network.
“Mt Gox has detected unusual activity on its Bitcoin wallets and performed investigations during the past weeks,” the company said. “This confirmed the presence of transactions which need to be examined more closely.”