Bitcoin value falls another 20 percent

Ongoing technical issues this morning on the MtGox Bitcoin exchange servers have caused the value of the digital crypto-currency to plunge by an additional 20 percent on top of last Friday's dramatic fall in value.

The currency traded for about $850 a coin for much of last week according to CoinDesk, which keep logs of Bitcoin's value over time, before plummeting to about $680 on Friday morning. Because of today's additional 20 percent loss, Bitcoins were worth just $538 at around 11 a.m. this morning – nearly half of what they reached last summer when the value of one Bitcoin soared to $1,000. The currency's value has begun to pick up again as the day has progressed to close at about $670.

MtGox is one of the largest and oldest Bitcoin exchanges in the world, but withdrawals to external wallets from its servers were suspended over the weekend as its technical team investigated issues with how withdrawal requests for Bitcoins are processed. The work required meant that the servers had to shut down, although they were supposed to restart this morning.

The exchange has now said in a statement that customers will not be able to transfer Bitcoins to an external wallet address until Tuesday at the earliest. This led to the dramatical plummeting in value of Bitcoin by nearly $310.

Bitcoin is known for its volatility of price and has seen many large fluctuations in its value in the past. The general trend is that the value will steadily increase for a few months before meeting dramatic fluctuations like the ones that we have seen over the past week, and investors in Bitcoin mining equipment are now beginning to become wise to Bitcoin's high price volatility.

Source: NBC News | Image via CoinDesk

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32 Comments

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Great time to buy :-)

I wish the fed and states would BUD out and stop hurting my assets!

Bitcoin is no different than owning homes or gold. As far as I am concerned it is money. Unlike a home however it is not backup by debt that bankers sell and short.

Gox is only one exchange. An exchange that has been suspected of one type of fraud or another for a long time. So excuses to prevent them from paying out cash or letting people transfer their BTC out is not a complete shock. The other exchanges are doing fine and we're still above where we were in December.

Technical problems? Indeed. And they're called circuit breakers. Too many wanted to cash out and there was not enough actual money in circulation to do so.

bubble burst. bit coin is biggest scam of recent days. it has no backbone, no work has been done to produce it and no country taking responsibility for it.

trojan_market said,
bubble burst. bit coin is biggest scam of recent days. it has no backbone, no work has been done to produce it and no country taking responsibility for it.

So in other words its the same as the American dollar?? Hehe

Xerino said,

So in other words its the same as the American dollar?? Hehe


countries all over the world use the American dollar as their currency because of its stability and predictability. But true it has had some volatility..

trojan_market said,
bubble burst. bit coin is biggest scam of recent days. it has no backbone, no work has been done to produce it and no country taking responsibility for it.

How many times now have people claimed that the "bubble" has burst? Yet give it a few weeks and its value picks right up again.

Xerino said,

So in other words its the same as the American dollar?? Hehe


American dollar is backed by US government, as long as it exist dollar exist. I don't know what country you are from (I guess you're from one of those US haters country that have hatred toward most acceptable currency on earth) but countries currency is different in nature because its tied to that nation's government existence. its backed by economy and market value. as long as you have trust on that country stability you are assured that the value of that money don't decrease or increase dramatically in short period of time.
I have to add one thing, If any government support bitcoin (including US) doesn't mean they are responsible for its fluctuation. They impose tax on the exchange of it which is potentially beneficial and understandable. just like any other stock exchange. they generally like it.

Edited by trojan_market, Feb 10 2014, 7:07pm :

Kushan said,

How many times now have people claimed that the "bubble" has burst? Yet give it a few weeks and its value picks right up again.


tell me if the main exchange website stop working all of the sudden for some reason how the hell you cash your money? It alone proves its scam. If you want to be involved in scam and gambling that's another matter.

Lachlan said,

countries all over the world use the American dollar as their currency because of its stability and predictability. But true it has had some volatility..

Currencies or more accurately "money" regardless of the age, country or amount of use, rely entirely on confidence and trust.

A $100 US bill has no inherent value. Zero. Nil. More than enough currencies over the decades/centuries have failed and ended up being useful only for burning in a fire for heat. There isn't much about the US dollar or the Euro or the Pound Sterling that makes them immune from this very possibility.

ExplodingKnees said,

Currencies or more accurately "money" regardless of the age, country or amount of use, rely entirely on confidence and trust.

A $100 US bill has no inherent value. Zero. Nil. More than enough currencies over the decades/centuries have failed and ended up being useful only for burning in a fire for heat. There isn't much about the US dollar or the Euro or the Pound Sterling that makes them immune from this very possibility.

"rely entirely on confidence and trust"

Like others are saying, the Dollar by a government, like the US, are different than something like this bitcoin crap. Like others are saying, no government entity is 'backing' this bitcoin money.

Do you know what a currency is in the US? Its the exact trade value in Gold. You are semi-right about the $100US dollar being nothing, by itself. No, its paper. BUT the paper MEANS something, that you 'could' go to the treasury and ask for $100 in return in Gold. THIS is the 'value' of the Dollar. If there is no gold to exchange the dollar, then essentially our money is null. But we still have the backing of the Treasury so the money is good. What government is backing bitcoin? None. I would never put 'real' money into something like that..

theslam08 said,

If there is no gold to exchange the dollar, then essentially our money is null.

The US hasn't been on the gold standard for a very long time. It's not backed by gold.

rfirth, is correct.
USD has leave the gold standard long ago, since Roosevelt 'new deal' era.

so, with what US govt back that USD?

theslam08 said,

Do you know what a currency is in the US? Its the exact trade value in Gold. You are semi-right about the $100US dollar being nothing, by itself. No, its paper. BUT the paper MEANS something, that you 'could' go to the treasury and ask for $100 in return in Gold.

Nonsense.

First you're suggesting the US is on a Gold Standard. It is not and has not been for many decades

Second the bill in your pocket isn't issued by the US Treasury but rather by the Federal Reserve.

You might want to go and google "Fiat Money" and "Nixon Shock" before posting tripe.

ExplodingKnees said,
You might want to go and google "Fiat Money" and "Nixon Shock" before posting tripe.
+1 Funny isn't it reading clueless comments from people who have no idea how their own currency works?

trojan_market said,

tell me if the main exchange website stop working all of the sudden for some reason how the hell you cash your money? It alone proves its scam. If you want to be involved in scam and gambling that's another matter.

You use a different exchange? The only people unable to "cash out" are those that have left their coins in that particular exchange. The exact same thing happens when your Bank's systems go down.

Kushan said,

You use a different exchange? The only people unable to "cash out" are those that have left their coins in that particular exchange. The exact same thing happens when your Bank's systems go down.


except when banks go down you can travel to that country and use your money to buy goods but what kind of moron give you goods (or gold) in exchange for bitcoin? If you saying in apocalyptic term then yes no one sells you anything because they will hold on to their usable items. that time even gold lose its value

trojan_market said,

except when banks go down you can travel to that country and use your money to buy goods but what kind of moron give you goods (or gold) in exchange for bitcoin? If you saying in apocalyptic term then yes no one sells you anything because they will hold on to their usable items. that time even gold lose its value

No, if a bank goes down you lost all of the virtual money you had in there. Or you think banks have a giant vault holding your paper bills? Real banks do also have liquidity issues, if each and every person holding money at a bank wanted to cash out at the same time they wouldn't be able to.

A Bitcoin exchange going down is the same as a bank going down, if you had funds in there then you are screwed, if your funds were still on your pocket you can take your business elsewhere.

i hope it drops further. best part of this mess? no governments in the world has the responsibilities to bail out any idiots buying into this fiasco.

Xerino said,
Since silkroad has gone the way of the dodo, it'll fall more and more.

You must be unaware that SR2.0 has been up and running since about two weeks after 1.0 was taken down.

Xerino said,
Since silkroad has gone the way of the dodo, it'll fall more and more.

Supply and demand. One site going down won't cause the currency to fail, another site will (And has already) take its place.

I got rich xD I actually had my buy set to $400 on BTC-e totally forgot about'it... I think it went as low as 200, but my purchases went through.

Gonna buy me a nice grand piano and a Laser TV.

Lord Method Man said,
I'll trade them for Pogs. I have some mint condition Apollo 13 pogs that were part of a Hardee's promotion.

You kept yours? Wow. I just have the Apollo 13 Hardee's collector cup.

This is a valid point, but something a lot of people seem to miss is that Bitcoin is, technically, still not mature yet. Right now, most people involved in it are only trying to make quick money - while that's going on, it won't be stable. As more and more places actually use Bitcoin as a currency - which is happening, it'll become more and more stable.