From George Yeager at Stansberry & Associates:
Has the Bitcoin "death spiral" begun...?
The shaky digital currency has been extremely volatile in the last several months... In fact, Bitcoin has fallen 5% or more in a single day 36 times in the past year. It’s even fallen 10% or more in a single day 16 times.
Now, Tokyo based Mt. Gox (one of the world’s most prominent Bitcoin exchanges) offers the latest reminder that investing in Bitcoin is more like pure speculation – one that could rob you of every penny you put in.
Last week, owners of Bitcoin were unable to cash-out their holdings on the exchange, leading to widespread panic in the digital investment community.
Mt. Gox cited “security issues” as the reason why. A technical issue within the exchange’s software would allow thieves to steal its customers' Bitcoins, prompting the temporary suspension of all transfers. This left many Bitcoin holders with questions as to whether or not their investments were still safe.
The price of Bitcoin was trading around $850 on the Mt. Gox exchange before the suspension. The digital currency was pushed as low as $91.50 (down nearly 83%) at the exchange, only a few days after the security issue.
On February 28th, Mt. Gox filed for bankruptcy protection at a Tokyo district court, having lost nearly all of its virtual currency...
Protestors have sat outside of Mt. Gox’s office in Japan since the problems began, carrying signs that express their concerns… one reads, “Where is our money?”
Many believe that security issues, such as the one that took down Mt. Gox, along with extreme volatility will ultimately spell doom for Bitcoin…
But the crypto-currency has another major problem that should concern investors… cyber-attacks and subpoenas.
Mt. Gox, along with other Bitcoin exchanges in Manhattan, have reportedly been served with subpoenas from Manhattan U.S. Attorney Preet Bharara investigating the way they handled a recent round of cyber-attacks launched against them. Security has proven to be a major concern for Bitcoin exchanges around the world, and Mt. Gox has become its first official victim.
Stories like these are exactly why Stansberry & Associates research partner Michael Palmer decided to put together a free report on a much safer alternative currency…
If you are like him, you’re probably worried about the value of the U.S. dollar. Mr. Palmer believes that the smartest thing you can do to protect yourself against the inevitable devaluation of our currency is to move some of your money into a currency that doesn’t go through the wild swings Bitcoin does, and is actually backed by something real – gold and silver. To watch the free video he put together, click here.
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