MtGox Files for Bankruptcy After Losing Nearly $500 Million in Bitcoin Currency

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News Posted: Sun, Mar 2 2014 11:03 AM
It's not as though crytocurrencies like Bitcoin are in need of any more bad publicity, though that being the case, it didn't stop MtGox from giving it to them. MtGox, formerly a popular Bitcoin exchange based in Tokyo, Japan, has filed for bankruptcy protection after admitting to having lost 850,000 Bitcoins worth approximately $477 million.

Most, if not all of the virtual currency was stolen by hackers who took advantage of what MtGox called "weaknesses in the system." Some 750,000 of those Bitcoins belonged to customers, while the remaining 100,000 units were MtGox's prior to the theft.

Bitcoin Magazine
Image Source: Flickr (zcopley)

This doesn't come as a complete shock considering MtGox froze withdrawals earlier in the month due to a bug in the software. Still, the heads up didn't soften the gut punch to customers who may have feared the worst, especially those who might have spent large sums of money investing in computer hardware capable of mining Bitcoins. These days, it's decidedly more difficult to dig up the virtual currency.

Critics of crytpocurrencies are using MtGox's misfortune as support for their arguments that Bitcoins and others like it should be banned, while others feel the industry needs regulation. Those who support the Bitcoin movement, however, are unfazed by this event and claim the virtual currency itself is not the problem, as opposed to MtGox's mishandling of them.
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Bye bit coining.

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JMeloni replied on Sun, Mar 2 2014 12:37 PM

1 company out of hundreds

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JesseLiss replied on Sun, Mar 2 2014 12:56 PM

Target hacked - 100 million credit card numbers stolen. Maybe credit cards should be banned.

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FRubi replied on Sun, Mar 2 2014 6:14 PM

Am I the only one that saw miners as a targeted pyramid scheme? The funny thing is, this will only garner more members.

Meanwhile AMD is making so much money, if they're not in on it, I dunno. I'm speechless...

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Bitcoin = beanie babies. Anyone who heavily invest in them will ultimately lose. If you want to make an investment, try coin collecting. At the end of the day, it will always be worth face value. And they are a little harder to lift. They are impervious to hackers, hardware malfunction and weak network security.

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Bitcoin mining at this point is nothing but a scheme to make money. They only people that make REAL money off of this, are the ones who started early and invested. With ASIC's out now and them being a pre-order "wait in line" kind of business its impossible to make a lot of money unless you have a lot to invest up front. By the time you wait for the ASIC the difficulty is so high you only make a tenth of what you could have. SCRYPT mining is the only fair market out there. However, the market is nowhere near as big and with electricity costs to run gpu's it takes a lot away from your profit.

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I have lost over a grand in the bitcoin market since I started back in late 2009. The first chunck of money was lost when a scandal with one of bit lc's founders stole a bunch of bitcoins from the company and fled the country. Now with mt gox gone, which was my primary exchange, I have now been fucked by the market a second time. As an ex miner leaving the market, I do not believe these companies are doing enough to protect or faith and investments.

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digitaldd replied on Mon, Mar 3 2014 10:05 AM

I had 50 bitcoin I obtained when mining was first introduced I ran a newly built PC for like a 4 day weekend and I've kept the bitcoin wallet offline only converting a few when they were up around $800-1K. Still have 35, its found $$ so i really don't care where the market goes when it was $560 last week I converted 3 to amazon giftcards, that should cover my amazon purchases for a while.

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amd probably did make a LOT of money because of bitcoining... i was browsing new egg one time for an Radeon 7970 which was only like 300 dollars. a few weeks later it increased by a hundred and fifty or so....

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