Shock as Bitcoin Exchange Mt.Gox Closes

MtGox one of the worlds largest Bitcoin exchanges has gone offline and this comes shortly after halting customer withdrawals just a few weeks ago. The news is a huge setback for the digital currency as it attempts to find its feet and greater acceptance. Other Bitcoin exchanges have distanced themselves from MtGox while a statement on their website stated that, "In the event of recent news reports and the potential repercussions on MtGox's operations and the market, a decision was taken to close all transactions for the time being in order to protect the site and our users. We will be closely monitoring the situation and will react accordingly." The closure of the site has been seen as a huge violation of trust by many Bitcoin users and in a joint statement, other exchanges said that, "As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today."

MtGox said that a loophole had been found within the system that could be used by criminals to exploit the exchange and steal funds, however reports are now circulating that the company has become insolvent after losing around $350 Million in trading. Due to the fact that Bitcoin is an anonymous currency, exploitation and theft of it is extremely difficult to trace and this new setback may deter larger investors. There is no safety net for users of MtGox and no central authority meaning that discovering the whereabouts of the missing Bitcoins may prove impossible. The head of MtGox has spoken on the subject saying that everything was being done to restore the service and Japanese authorities are said to be looking into the issue.

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