The Mt. Gox bitcoin exchange has fallen from crypto-currency grace as holders still are having difficulties withdrawing bitcoins. The price on the Mt. Gox exchange (bitcoin’s value varies on what exchange it is on) has fallen from $829 per coin to under $130, and bitcoin holders cannot do anything as the value has rapidly declined. In comparison, the value for one bitcoin on the Bitstamp exchange is $566 and $553 on the BTC-e exchange. Nevertheless, bitcoin fell from the highs of over $1,200.
Mt. Gox released statements that it is working to relieve the withdrawal issues it is currently facing. However, it is speculated that owners cannot withdraw their balance because they have been compromised by hackers, which would not be the first time in the bitcoin space. “Since traders can’t get their Bitcoin out of Mt.Gox right now, the price is discounting a probability that they will never be able to get their Bitcoin out,” said Wedbush analyst Gil Luria.
Although the withdrawal issues surrounding Mt. Gox seem to be isolated, the situation has given bitcoin enthusiasts a bit of irony. Many believed bitcoin would be a safe-haven from a fiat currency collapse, and the only thing that has collapsed is the bubbly price of bitcoins – on all exchanges. The virtual currency’s backing idea is valid, but it still has a vast list of structural difficulties needed to be overcome before it can be a substantially be utilized as a means of commerce or wealth storage.