The price of the digital currency bitcoin fell sharply after bitcoin digital marketplace Mt. Gox halted withdrawals indefinitely after detecting “unusual activity.”
On the Mt. Gox platform the currency plunged to as low as $500, down more than 27 percent, but rebounded to $595.74.
“This technical issue is of a much larger intensity than we’ve seen in the past,” said Sebastien Galy, currency strategist at Societe Generale in New York to Reuters. “The market may be realizing that there are issues which are specific to these forms of currencies.”
Bitcoin prices have been on a rollercoaster rides as they both gain acceptance in some markets and scrutiny from government financial agencies in other.
More recently, the digital currency has drawn increased scrutiny as New York’s top bank regulator last month revealed plans to regulate businesses handling transactions in bitcoin this year, Reuters reports.
Mt. Gox officials said withdrawals were on hold indefinitely after it “has detected unusual activity on its bitcoin wallets and performed investigations during the past weeks. This confirmed the presence of transactions which need to be examined more closely.”
Mt. Gox said the issue was not limited to the exchange and “affects all transactions where bitcoins are being sent to a third party.” It said the withdrawal suspension would be in effect until the issue has been resolved, Reuters reported.
