One of the largest bitcoin exchanges got virtually robbed, and $400 million of their virtual money is gone, making the company insolvent. MtGox is under investigation by American and Japanese agencies over the $400 million theft.
In an age where many companies are unable to secure their own servers due to cost, ignorance, or lack of care, why is everyone surprised that hackers managed to get into an online company to steal online money? Investigators are saying that those who lost money are going to be out of luck.
What in the world is a bitcoin anyways? From the first paragraph of the Wikipedia entry for it: “ Bitcoin is a peer-to-peer payment system and digital currency introduced as open source software in 2009 by pseudonymous developer Satoshi Nakamoto. It is a cryptocurrency, so-called because it uses cryptography to control the creation and transfer of money.[5] Conventionally, the capitalized word "Bitcoin" refers to the technology and network, whereas lowercase "bitcoins" refers to the currency itself.[6] “
In other words, people pay real money for a certain number of bitcoins. At today’s exchange rate, one bitcoin is worth $558.00 The currency sharply devalued after the MtGox exchange was robbed of roughly $400 million in bitcoin currency a few days ago.
I don’t trust online-only currency that is not backed by full faith and credit of a sovereign government and in widespread use. Seems like “buyer beware” is the word of the day when it comes to deciding whether or not to invest in this kind of currency.
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