Mt. Gox Halts Bitcoin Transactions, Site Disappears

Feb 25, 2014 12:00 PM PST

TOKYO — Mt. Gox, the once-dominant trading platform for the bitcoin cryptocurrency, today said it has stopped all transactions "for the time being in order to protect the site and our users."

News of the trading site's closure comes at a time when bitcoin has gained wide acceptance in the processing of online adult transactions.

Just yesterday, Playboy Plus became the latest adult company that have allowed consumers to pay in bitcoin, joining more than a dozen that have rolled out the welcome mat.

But investors who used Tokyo-based Mt. Gox have been unable to withdraw funds from the exchange since the beginning of this month. And rumors have swirled this week that Mt. Gox had lost almost 750,000 bitcoin to theft because of a flaw in software.

While the value of the alleged loss can't be quantified because of bitcoin price fluctuations, the Wall Street Journal reported that the amount would represent around six percent of bitcoin in existence and a value of around $365 million at Monday's prices.

At post time, Mt. Gox's website and Twitter posts appeared to have been deleted.  

Meanwhile, chief executives of six major bitcoin companies — exchanges Bitstamp, BTC China and Kraken, as well as broker and payment processor Coinbase; payment firm Circle Internet Financial; and Blockchain.info, a provider of  ewallets — pledged in a joint statement to coordinate efforts to assure customers of the security of their funds.

"This tragic violation of the trust of users of Mt. Gox was the result of one company's actions and doesn't reflect the resilience or value of bitcoin and the digital currency industry," the statement said. "As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today."

Today's news has shaken Bitcoin investors, knocking the price down to $535 per bitcoin at post time. In November, Bitcoin traded at $1,200.

Besides Playboy Plus, other adult entertainment companies have set up bitcoin payment options, including MOFOs, Naughty America, Wicked Pictures, Porn.com, Grooby.com, DominicFord.com, ClassyCams.com and MetArt.com, as well as Internet payment service provider Verotel, among others.

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