There is no doubt that Bitcoin has been through a tumultuous past 30 days. Not even six months ago, the virtual currency had outstanding potential and was even being touted as the “next big thing” in the electronic payment industry. The question is, can Bitcoin overcome its recent struggles, or have the events of the past 30 days caused enough damage to destroy the company.
The trouble first began when Mt. Gox, the popular Tokyo-based bitcoin exchange, abruptly filed for bankruptcy in late February after hackers infiltrated the exchange’s system. Mt. Gox stated, that the company could not account for 750,000 of its customers’ bitcoins and 100,000 of its own, totaling as much as $474 million. Poor operations, security and an incompetent CEO have taken most of the public blame for the crisis.
“We had weaknesses in our system, and our bitcoins vanished,” Mt. Gox CEO Mark Karpeles stated. “We’ve caused trouble and inconvenience to many people, and I feel deeply sorry for what has happened.” Despite Karpeles’ apology, there have been a plethora of lawsuits from outraged users who have lost money in the conspiracy, some seeking as high as $500 million in compensation.
Most recently, the weekly magazine Newsweek, ousted Dorian Satoshi Nakamoto as the elusive founder of Bitcoin. Nakamoto has adamantly denied the allegations and is reporting seeking legal action against the magazine. Even though Bitcoin did nothing to cause this mess, it has still affected the public perception of the company.
Despite these recent struggles, it is the technology behind Bitcoin that may end up saving the company from an untimely demise. It is innovative, creative and could spawn a revolution for how consumers pay for products and services. Bitcoin very well may have come to the end of its road, but you better believe that another company will continue to grow and expand the technology.
So what do you think? Are these too many problems and concerns to overcome for such a young company? Who you ever consider using Bitcoin? How do you see the virtual currency technology changing both the banking and digital consumer industry?