Bitcoin, which is a digital currency and is widely used by online retailers, was all the rave in 2013. Many companies were scrambling to accept bitcoins so they would not miss the boat. The bitcoin craze had even reached the mainstream media. Over the past year, both CNN and FOX News have had many stories on bit coin.
Being a currency like other currencies, a valuation has to be assessed on bitcoins, thus the need for an exchange. Several exchanges appeared over the past couple of years and several Forex brokers that did not want to miss out on the bitcoin craze, started offering bitcoins to be traded on their forex trading systems like MetaTrader 4. Since banks were not offering bitcoins, the streaming prices needed to come from these online exchanges like Mt. Gox.
The past week has seen the bitcoin world fall flat on its face. The largest exchange, Mt. Gox, and its website shut down and has not returned deposits to its customers. As a result, the price of bitcoins has dropped dramatically. The Forex brokers, that were once with this large bitcoin exchange, have since had to get their data feeds from secondary exchanges. With public confidence in bitcoins looking completely lost, the next question is whether bitcoin will survive this event?
As we saw in 2008, markets need public confidence and trust. It will take a lot for them to regain the public trust in bitcoins. But in time with the right players involved and with some oversight, bitcoins could come back.
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