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The bitcoin price has fallen for yet another week, with little expected good news on the horizon. It’s also been a fairly quiet week on the financial news front, with few stories to select from for the roundup.
Seven-day average price: $222.87 End of week market cap: $3.2 billion
(Prices quoted according to Coindesk Bitcoin Price Index)
Mt Gox Coins Were Stolen Long Before Closure
Thanks to the unofficial work of bitcoin security company WizSec, it now appears that the bitcoin funds from failed bitcoin exchange Mt Gox were stolen long before the exchange closed its doors.
By tracking the publicly available data on the Bitcoin blockchain and analysing various leaks surrounding the Mt Gox failure, WizSec have claimed that the coins started to go missing as early as 2011. The bitcoin reserves were almost completely depleted by the middle of 2013, long before the collapse in February 2014.
The gradual process of the thefts look like an inside job. It also seems hard to believe that the business would continue to operate without realising the funds were missing, and the infamous “Willy Bot” now looks like it could have been ran by Mt Gox itself to help rebalance the books.
The report should act as a warning for anyone that currently trades on a bitcoin exchange. In this unregulated industry it is difficult to know how user funds are being handled behind closed doors. Users need to be putting pressure on exchanges to increase transparency, and voting with their feet by choosing to trade on exchanges that are making proactive steps to build user trust.
Infosys Experimenting With Bitcoin
Following the news of BNY Mellon’s bitcoin experiments reported in last week’s roundup, another big financial player, Infosys, has announced that they are also looking into how the blockchain technology could be leveraged to improve efficiency. Infosys provide software solutions to the banking sector, and are currently in the process of a major upgrade to their Finacle product, a front-end to bank databases.
The announcement is light on details, and I’m curious to know how they plan on implementing the blockchain within their existing products. As mentioned in my previous article, I would be skeptical of the benefits to be gained by creating their own private blockchain, instead a centralised database may be more useful here. But if they plan on ‘piggy-backing’ the existing Bitcoin blockchain, using it record data and transaction details rather than store and transfer bitcoin itself, then I’d be very interested to see what solutions they can come up with.
Full disclosure: Neil Woodfine is an employee of bitcoin exchange OKCoin and is invested in bitcoin. The views expressed above are purely the author’s own and do not represent any organisation. None of the above should be considered as investment advice.
