Bitcoin Price Tumbles After Massive Account Hack and Sell-Off on Trading Site Mt.Gox

Illustration for article titled Bitcoin Price Tumbles After Massive Account Hack and Sell-Off on Trading Site Mt.Gox

A user account carrying a significant amount of Bitcoin on the trading site Mt. Gox was hacked by an unknown party, who then attempted to sell the lot to themselves and exchange the Bitcoin into US dollars. Then all hell broke loose.


After word of this breach got out yesterday, the price of Bitcoin plummeted due to a massive sell off (it was under $2, currently around $4), MT.GOX shut down for the day, and now they're rolling back all trading to it's state before the breach.

The bitcoin will be back to around 17.5$/BTC after we rollback all trades that have happened after the huge Bitcoin sale that happened on June 20th near 3:00am (JST).

One account with a lot of coins was compromised and whoever stole it (using a HK based IP to login) first sold all the coins in there, to buy those again just after, and then tried to withdraw the coins. The $1000/day withdraw limit was active for this account and the hacker could only get out with $1000 worth of coins.

Apart from this no account was compromised, and nothing was lost. Due to the large impact this had on the Bitcoin market, we will rollback every trade which happened since the big sale, and ensure this account is secure before opening access again.


It's still undetermined who was responsible for the hack, but the IP address originated out of Hong Kong. Mt. Gox is working to shore up any holes in their backend, and all users will be forced to reauthenticate their accounts. But still, how were there not more stringent security measures for this entire economic ecosystem to begin with? [Mt.Gox via Slashdot]

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Wait, are they (MT.GOX) allowed to do this? I thought MT.GOX was not an official governing body (e.g. NOT like the Federal Reserve). Isn't that the point of Bitcoin? To be de-centralized? If that's still the case, how could they just revert trading back? You can't go back in time and say "oopsies, we are going to have a do-over." Yes, you can invalidate the thief's transactions since they were stolen property but you can't alter the other transactions. Actually come to think of it, you shouldn't do anything as a result of the theft. Isn't this what Bitcoin is all about? Not wanting any outside help, regulations, or protection?