Bitcoin hit by DoS attacks

Earlier this week the Mt Gox and Bitstamp exchanges ceased operations due to the attacks.

“A bug in the Bitcoin software makes it possible for someone to use the Bitcoin network to alter transaction details to make it seem like a sending of Bitcoins to a Bitcoin wallet did not occur when in fact it did occur. Since the transaction appears as if it has not proceeded correctly, the Bitcoins may be resent,” said Mt Gox in a statement.

The Bitcoin Foundation assured users the perpetrators of the DoS attack were not stealing money.

“Whoever is doing this is not stealing coins, but is succeeding in preventing some transactions from confirming,” they said.

“It’s important to note that DoS attacks do not affect people’s bitcoin wallets or funds.”

The foundation said users may see their funds “tied up” in unconfirmed transactions but they would be fixing the bug in order to return the funds to the users’ wallets.

Since the closure of the exchanges the price of Bitcoin has dropped, with it standing at US$524 today.

HumanIPO reported earlier this week Russia had banned the use of Bitcoin in the country, citing its potential to aid money laundering and financial terrorism as reasons for the ban.

Russia’s Prosecutor General’s Office said this week: “Systems for anonymous payments and cyber currencies that have gained considerable circulation – including the most well-known, Bitcoin – are money substitutes and cannot be used by individuals or legal entities.”

Last month two American Bitcoin traders were arrested on charges of money laundering as discussions were held to brainstorm ways in which the currency could be regulated.

The arrests came just months after a dark web market for illegal drugs, that made use of Bitcoin for transactions, was shut down and creator Ross William Ulbricht was arrested.

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