BITCOIN'S price is yet to recover from a cyber attack yesterday evening on digital wallet provider BlackWallet. Over $400,000 (£290,000) of cryptocurrency Stellar Lumen after an unidentified group broke into the web-based wallet application.
07:43, Tue, Jan 16, 2018 | UPDATED: 10:48, Tue, Jan 16, 2018
10.33am - UPDATE - China, not South Korea to blame?
Iqbal Gandham, UK Managing Director at eToro, has told Express.co.uk:
“The market is correcting off the back of news that China is moving to crack down on cryptocurrency trading. Chinese investors are likely spooked having heard the news and the market is on edge as a result.
“But we don’t expect to see a major sell-off. Bitcoin in particular has gone through this cycle before, eventually shrugging off regulatory clampdowns from governments and central banks after initially falling in price.
9.59am - UPDATE - Slipping?
Bitcoin $11,503.
Ethereum $1,031.
Ripple $1.23.
Bitcoin has dropped $2,128.28 on the day so far at the time of press. Yikes.
Etheruem has lost $259.37.
Ripple may have only lost a few cents but that marks a third of its price.
9.23am - UPDATE - Let the price plunge begin
Bitcoin is down to $11,794 after hacks, revelations of price manipulations, and threats of government regulation have dominated the new year.
Remember this time last month we were all watching agasp as bitcoin's price headed towards the $19,000 peak it hit on December 19.
Ethereum $1,081.
Ripple $1.36.
Feeling down? Over in Japan a new eight-member girl pop group have emerged called Kasotsuka Shojo ('Virtual Currency Girls'). The new band dress as french maids with mexican wrestler masks over their faces and each member represents a different cryptocurrency. Obviously.
The Financial Times (who else) are reporting that Hinano Shirahama, as bitcoin, has appointed herself the band's leader, however in an early onstage tussle at the group's first ever gig, bitcoin's leadership was challenged by Rara Naruse, the representative of bitcoin cash.
The FT's guy in Tokyo reports that the song, “The Moon and Virtual Currencies and Me” opens with the lyrics, “It’s hell if you buy at a high price!”, but, “don’t underestimate the market!”
8.44am - UPDATE - Is bitcoin's price controlled by bad actors?
Bitcoin $12,080.
Ethereum $1,068.
Ripple $1.34.
A shocking new academic study has revealed that so-called "bad-actors" manipulated bitcoin's price, pushing it from $150 to $1,000 during periods of frenetic trading.
The paper titled Price Manipulation in the Bitcoin Ecosystem shows how Bitcoin markets are being manipulated by one or two big players.
The paper looks at two spells of suspicious trading activity on the Mt. Gox Bitcoin currency exchange, in which approximately 600,000 bitcoins (BTC) valued at $188 million were "fraudulently acquired”.
The authors, Neil Gandal, JT Hamrick, Tyler Moore, and Tali Oberman write: "During both periods, the USD-BTC exchange rate rose by an average of four per cent on days when suspicious trades took place, compared to a slight decline on days without suspicious activity.
"Based on rigorous analysis with extensive robustness checks, the paper demonstrates that the suspicious trading activity likely caused the unprecedented spike in the USD-BTC exchange rate in late 2013, when the rate jumped from around $150 to more than $1,000 in two months.”
Here's where it might get a little concerning for all those in mainstream finance looking at digital currencies as an investment option right now - the manipulation was caused by two bots named Markus and Willy that were seemingly making (at least to the market) valid trades but did not actually own the bitcoin they were using.
During the Mt. Gox hack a number of these bots were able to create fake trades and make off with millions while not investing anything or carrying any risk, but manipulating the price of bitcoin and making off with the price difference.
7.54am - UPDATE - Hack attack sends bitcoin to $12k
Bitcoin is priced at $12,771 (£9,295) this morning after news of the Hack attack broke on Reddit yesterday evening.
Ethereum is down at $1,213 (£879).
Ripple has dropped to $1.56 (£1.13).
News of the attack, as reported by Matt Drake here, was reported by BlackWallet's creator, using the username Orbit84 on Reddit, in a statement:
"I am sincerely sorry about this and hope that we will get the funds back. I am in talks with my hosting provider to get as much information about the hacker and will see what can be done with it.
"If you have entered your key on BlackWallet, you may want to move your funds to a new wallet using the Stellar account viewer.
"Please note however that BlackWallet was only an account viewer and that no keys were stored on the server.”