The Daily Bail

The bloodshed continues today. Watch the mayhem unfold.

Bicoin real time quotes: http://realtimebitcoin.info/

Check out the $5 spread on the bid-ask. Reminds me of the old Nasdaq days before high frequency trading. Currently bidding 118.75 asking 123.50.

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UPDATE - Bitcoin exchange freezes, arbitrarily shuts down

The carnage is palpable.

Aftermarket chart for Bitcrash, from 100 to 200 and all points inbetween.

Background

Just a few months ago the total net worth of all Bitcoins, a popular encrypted digital currency, was worth about $140 million. The non-tangible exchange mechanism is used by people all over the world to purchase everything from traditional goods and services, to illicit trade that may include drugs and stolen credit card numbers. The coins became a go-to digital store of wealth around the world after the meltdown of the Cypriot financial system, and was pushed as a ‘safe’ way to preserve wealth out of view prying government eyes. All of the excitement surrounding Bitcoin has driven the price of a single unit to in excess of $250, giving the total Bitcoins in global circulation a market capitalization of over $2.5 Billion in just a few months time.

Today's Carnage

Bitcoin is undergoing a classic correction after quintupling in price over the past 30 days. The currency, which was trading as high as $265 earlier today on Mt. Gox, plummeted and is now trading at around $150.

We’ve reached out to one of the biggest exchanges, Mt. Gox, to see what happened. But another San Francisco-based exchange called TradeHill is saying that the crypto-currency is falling because of apparent distributed denial of service attacks on Mt. Gox and Bitstamp. A denial of service attack happens when an attacker overwhelms a target with external requests, so that it can’t honor regular requests from legitimate users.

This also happened last week when Mt. Gox when Bitcoin reached $142 and hackers attacked the exchange. At that point, Mt. Gox said it had suffered ”its worst trading lag ever.”

The Tokyo-based exchange said last week that hackers are engaging in a strategy to manipulate the price of the currency: “Attackers wait until the price of Bitcoins reaches a certain value, sell, destabilize the exchange, wait for everybody to panic-sell their Bitcoins, wait for the price to drop to a certain amount, then stop the attack and start buying as much as they can. Repeat this two or three times like we saw over the past few days and they profit.”