Bitcoin Foundation blames Mt. Gox for Bitcoin's troubles

What Mt. Gox called a bug is actually an underlying problem, the group said

A problem identified by Mt. Gox as a bug in Bitcoin software is actually a longstanding technical issue Mt. Gox should have prepared for, the Bitcoin Foundation said Monday.

Mt. Gox blamed problems with its currency exchange on a bug in Bitcoin's software allowing for so-called "transaction malleability," giving people the ability to change Bitcoin transaction details after the fact. Fraud could be the outcome and Bitcoin's value has been on a downward spiral since Mt. Gox called out the problem Monday after suspending transactions last Friday.

But actually there is no bug -- transaction malleability is an underlying issue in Bitcoin's software, and Mt. Gox should have prepared its exchange for it, the Bitcoin Foundation said in response.

Transaction malleability has been known about since 2011, said the group, which provides funding support and other resources for the Bitcoin technology. Mt. Gox's problems, the group said in a statement, are due to an interaction between Mt. Gox's so-called wallet storage software, its customer support procedures and unpreparedness for transaction malleability.

"This is something that cannot be corrected overnight," the Bitcoin Foundation said. "This is a good reminder that Bitcoin is still young and experimental," it said.

Mt. Gox did not immediately respond to a request for comment.

Bitcoin was trading at roughly US$570 during late morning Pacific time Monday on the Mt. Gox site, while for much of last week the currency was trading in the mid-$800 range.

Bitcoin took a dive Friday when Mt. Gox said it was temporarily suspending withdrawals on its site because of the software problem.

Bitcoin's value has been on a roller coaster ride for some time now. Besides Mt. Gox, other exchanges for buying and selling bitcoins include Coinbase, BTC China and Circle. But the fact that Bitcoin's value could drop so much with the problems of Mt. Gox suggests the site has considerable influence on the market.

Zach Miners covers social networking, search and general technology news for IDG News Service. Follow Zach on Twitter at @zachminers. Zach's e-mail address is zach_miners@idg.com

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags Internet-based applications and servicesMt. Goxconsumer electronicse-commerceBitcoin Foundationinternet

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Zach Miners

IDG News Service
Show Comments

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?