This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Mt. Gox's Disappearance Is Latest Blow for Bitcoin Investors

NEW YORK (TheStreet) -- On Monday, I wrote that bitcoin exchange Mt. Gox appeared close to imploding. It was the first time I've written a prediction that I hoped wouldn't come true.

But on Monday night, my fears were realized. Mt. Gox's Web site went blank, without notice about the company or depositors' status.

Reuters reports Tuesday morning that the company's founder is unaccounted for and that Mt. Gox's office is empty with the exception of some protestors.

The rise and fall of the Tokyo-based exchange was swift. At one point in 2013, it reportedly processed the majority of all bitcoin exchange volume.

The surge in bitcoin's price and popularity unfortunately attracted cybercriminals bent on exploiting weaknesses. Several multimillion-dollar heists have already been reported. An online document outlining a crisis strategy also began circulating late Monday that may illuminate what happened and what to expect next.

According to the document, 777,408 bitcoins, or about $600 million (based on recent bitcoin prices before Mt.Gox halted withdrawals), are unaccounted for. That's a staggering amount.

Online payment processing fraud and theft aren't new to bitcoin, though. PayPal, now a unit of eBay (EBAY), experienced significant fraud in its early days and hired outside security experts to combat it.

The bitcoin market reacted rapidly to the latest news about Mt. Gox. According to Bitstamp, prices fell to 2014 lows of $400 before partially recovering near $500 at the time of writing.

People are asking whether Mt. Gox's apparent failure will spell the end of bitcoin, but the virtual currency appears to be bigger than one exchange.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $123.25 0.00%
FB $83.30 0.00%
GOOG $548.34 0.00%
TSLA $185.00 0.00%
YHOO $45.10 0.00%


DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs