If anyone outside of the bitcoin community would have listened to various mainstream media outlets this week, one would think that the virtual currency market has imploded, investors have lost their entire net wealth a la 1929’s Black Tuesday and critics have been proven correct. This is not the whole story, though.
For those that aren’t cryptocurrency savvy, it should be pointed out that bitcoin is not Mt. Gox and vice versa. The two are completely different from one another: bitcoin is a digital currency, while Mt. Gox is a bitcoin exchange platform that suffered many technological glitches and, depending on who you’re speaking to, was filled with incompetence.
Experts concur that there are quite a number of security vulnerabilities of currency exchanges that hinder the potential growth of bitcoin and its economy. In order for a new exchange platform to succeed and allow the market to regain confidence in bitcoin, a series of brand new standards, rules, regulations and transparency need to be adopted.
The Bitcoin Foundation recognizes this important fact:
“These large exchanges that are international and global are more important in the early stages of Bitcoin when we need price discovery,” Jon Matonis, director of the Bitcoin Foundation, told the Verge. “You don’t need them in the long run because in a true Bitcoin economy you’ll have a closed-loop system.”
As we reported this week, there is a document floating around titled “Crisis Strategy Draft,” in which Mt. Gox thinks its insolvency will lead to “the end of Bitcoin, at least for most of the public.” 
Indeed, Mt. Gox customers have lost an astronomical sum of money, an amount that might not ever be recuperated – though there are calls for holding a donation drive to raise money for those affected – proponents say this is just another bump in the road during the infancy period and may even be the best thing that ever happened to the digital currency.
In the last several days, bitcoin has dropped to less than $500. However, in just one day, bitcoin has regained some of its losses and is trading at just under $600. Bitcoiners say if the digital currency collapsed because of Mt. Gox then why would it be inching higher instead of the opposite direction?
Silicon Valley heavyweight Marc Andreessen gloated about this very fact Wednesday on Twitter:
“I will happily retweet all retractions and apologies from people who wrongly forecasted death of Bitcoin as result of MtGox collapse :-).”
Mark Twain is often misquoted with this line “The reports of my death are greatly exaggerated.” This phrase may apply to bitcoin. Here is a list of some of the news organizations to say bitcoin is essentially dead.
Los Angeles Times: “Bitcoin virtual currency is on verge of collapse”
Yahoo! Finance: “Mt. Gox slammed! Why Bitcoin’s troubles aren’t over”
All Voices: “Did Mt. Gox kill bitcoin?”
Edmonton Journal: “Sudden shutdown of Mt. Gox a lesson for Canadian Bitcoin enthusiasts: experts”
Edmonton Journal: “Bitcoin future in jeopardy as Mt. Gox goes offline amid reports of crippling theft”
Toronto Star: “‘The end of bitcoin’? Major online exchange Mt. Gox goes bust”
Palisades Hudson Financial Group: “The End Of Bitcoin’s Beginning”
WRAL: “Local Durham bakery accepts bitcoin despite shaky future of currency”
Agence-France Presse: “Bitcoin world in turmoil after exchange goes dark”
The Market Oracle: “Bitcoin Ponzi Scam Crash Update – MTGox Vanishing Act, Who Will be Next ?”
Whether or not these media outlets will be on the right or wrong side of history remains to be seen. However, sensationalist news reporting might be the tactic that will drive the dedicated and enthusiastic bitcoin owner, developer and promoter to improve the cryptocurrency market.
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