Mt.Gox promised to get its house in order, and get back to the Bitcoin community and its users today. It did, but didn’t open up withdrawals, or set a firm timetable as to when users might be able to get their currency off the exchange.
In response, the price of Bitcoin on Mt.Gox has cratered, again. It now rests just above $110. That’s down from around $260 the day before. Users are betting more heavily now that their Bitcoin on the exchange is never coming back.
This turbulence has not left the larger Bitcoin market unmolested. According to the averaged Bitcoin price, the dollar cost of a Bitcoin has shed around 10 percent of its value today, falling from $625 to $560. Mt.Gox, previously trading at around a 50 percent deficit, is now trading at one-fifth the regular price.
Why would Mt.Gox bring down the value of Bitcoin on other exchanges? The failure of Mt.Gox highlights what sort of risk unregulated markets might entail. And in frankness Bitcoin has been on a slow deflate tip all year. The average Bitcoin price spiked over $900 in January, before settling into a pattern of decline.
For now, enjoy some irony (screenshot taken today):
IMAGE BY FLICKR USER HAMED AL-RAISI UNDER CC BY 2.0 LICENSE (IMAGE HAS BEEN CROPPED)