Bitcoin Glitch Causes Cryptocurrency Crash

 

A technical glitch discovered last week by Mt. Gox, which caused the Bitcoin exchange to suspend certain withdrawals, sent Bitcoin’s value plummeting Monday morning.

The glitch makes it possible for someone using the Bitcoin network to alter transaction details to make it appear as if Bitcoins were not sent to an external Bitcoin address when they actually were, Mt. Gox said. The transaction looks as if it did not proceed correctly and therefore, Bitcoins may be resent. Mt. Gox is working with the Bitcoin core development team to resolve the issue.

The exchange said that the problem is not limited to MtGox and affects all transactions in which Bitcoins are sent to a third party. Mt. Gox advised the Bitcoin community to be very cautious with anyone claiming their transaction did not go through. The exchange also noted that this glitch will affect any other cryptocurrency using the same transactions scheme as Bitcoin.

Once the news broke, the virtual currency’s value crashed on Mt. Gox, falling from just under US$700 to just above US$500 Monday morning. They have since rebounded back above US$600. Its value was over US$800 before Mt. Gox suspended withdrawals last week.

Mt. Gox is still allowing transfers to Mt. Gox Bitcoin addresses and currency withdrawals.

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