Bitstamp suspends Bitcoin withdrawals following denial-of-service attacks

The world's second biggest Bitcoin exchange, Bitstamp, has announced that it has suspended Bitcoin withdrawals following a denial-of-service attack on the exchange.

According to Bitstamp, the denial-of-service attack caused by difference in wallet implementations has resulted in transaction inconsistencies as well as disruptions with balance checking. The exchange will not be processing deposits and withdrawals till a fix for the issue is put in place. The transactions carried out during the 10th and 11th of February will be cancelled and the amount will be reverted.

The value of Bitcoin dropped by a sharp 20 percent to $538 before climbing back to $648 in just a couple of days, which often leads to heavy transactions from short-term investors. According to Andreas Antonopoulos, chief security officer for Blockchain.info whose app was removed from the Apple App Store recently, "Funds have not been lost, and have not been affected. What it’s done is slow down their accounting system from reconciling transactions."

As Bitcoin continues to struggle with currency regulators around the globe, disruptions from hackers can be a major setback even if no funds are reported stolen.

Source: Bloomberg | Image via Salon

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