Internet, Technology

Indians lost crores in MtGox-Bitcoin game

Bitcoin-1.gifMtGox halted all bitcoin trading on its platform last week, leaving hundreds of thousands of people wondering what to do next. Being world’s largest bitcoin exchange platform, rumors claim that with MtGox’s shut down, over 750,000 bitcoins or 6 percent of the total bitcoins present in the system – just vanished.

No wonder India had also witnessed a rising trend in the interest of bitcoin trading since early 2013, despite several warnings from RBI – the central banking institution of India. In December RBI raised a red flag against bitcoin and said that it is currently studying the currency and trying to figure out what kind of laws or guidelines should be laid down for any trading and usage of such virtual currencies.

Several Indians traded the virtual currency in an effort to get higher returns on their untaxed money. But the sudden shutdown of MTGox has led them to a dark end.

According to a report released by The Hindu, there were approximately 35,000 bitcoins in the system that were kept by Indians and a majority of which were being traded on MtGox. The report also shows that the total value of bitcoins lost with MtGox’s shutdown could be somewhere between INR 10 crore to INR 20 crore.

The cost per Bitcoin today has been slashed by more than half, from where it originally stood in early December 2013. According to another website for Bitcoin exchange rates Preev, today it costs over INR 34,000 to buy just one Bitcoin. This downfall trend in the value of bitcoin was however first seen when Chinese search engine Baidu stopped accepting bitcoins on any of its online properties last year.

Such crypto currencies do not provide any monetary value to its holder and thus can go zero in value at any time. MtGox’s sudden shutdown has moreover put forward another example for the weak security value such currencies has to offer against sophisticated hacking attacks.

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