YOUR MONEY

 

bitcoin - the second shoe drops

This last week has not been good for bitcoin.
 

 The government of Russia has followed China's lead and barred bitcoin.

And 2 bitcoin exchanges- MtGox in Tokyo and Bitstamp in Slovenia - had to shut down for a day after being ripped off as some clients were given double payments or were subject to other “hacker attack”.

Whether the former fraud was made possible by a weakness in bitcoin’s encryption or an error by the exchange’s own computer systems,  bitcoin's value and price dropped 20% almost instantly to                US $535. (Globe and Mail, Feb. 12, 2014, B2 “Bitcoin reels as opponents deal body blow”) 
 

Such flaws in currency security are never good and the roller coaster --  mostly down and down - - volatility in bitcoin pricing  over the last few months would never be tolerated by any central bank or country -- unless it was on the verge of total collapse!
 

And unlike real currencies, bitcoin cannot go to the International Monetary Fund (IMF) or the World Bank to prop it up.

It is fool's gold!