Tuesday, April 21st24.0°C
24963

Canadian bitcoin bank collapses after hackers steal digital currency

SAN FRANCISCO - A Canadian bank specializing in bitcoins says it has closed after computer hackers stole its digital currency.

The closure of the Flexcoin bank comes just a week after the collapse of Mt. Gox, a major bitcoin exchange. The Japan-based Mt. Gox also linked its demise to an electronic heist.

The twin failures of Mt. Gox and Flexcoin will likely raise more doubts about bitcoin's ability to establish itself as an alternative currency.

In a notice Tuesday, Flexcoin says 896 bitcoins were stolen from its online vault. That translates into a loss of about $600,000, based on bitcoin's current trading value.

Unlike banks dealing in government-backed currencies, Flexcoin's losses aren't covered by deposit insurance. The Alberta bank says it can't recover from the setback.

Bitcoins that Flexcoin kept offline, or in "cold storage," remain secure, according to the bank. Although Flexcoin didn't provide details, bitcoins stored this way are often documented on paper certificates or on a hard drive that's not connected to the Internet.

The Mt. Gox collapse represents a far bigger blow to bitcoin's credibility. That downfall wiped out about 750,000 bitcoins, or about six per cent of the currency's total circulation. Mt. Gox has filed for bankruptcy protections while it sifts through its financial mess.

Supporters are touting the five-year-old currency as a way to lower transaction fees by cutting out banks and payment processors that collect billions of dollars annually by serving as financial middlemen. Skeptics, including government leaders around the world, deride bitcoins as a currency suitable only for speculators.

The Canadian Press


Read more Business News

25538


Recent Trending




Today's Market
S&P TSX15346.44-66.16
S&P CDNX700.17-3.48
DJIA17949.59-85.34
Nasdaq5014.10+19.50
S&P 5002097.29-3.11
CDN Dollar0.8148+0.0002
Gold1201.70+8.20
Oil55.50-0.88
Lumber247.00+4.10
Natural Gas2.571-0.004

 
Okanagan Companies
Pacific Safety0.135+0.020
Knighthawk0.010.00
QHR Technologies Inc1.45+0.03
Cantex0.035+0.005
Anavex Life Sciences0.445+0.060
Metalex Ventures0.10+0.02
Russel Metals27.00-0.42
Copper Mountain Mining1.07-0.03
Colorado Resources0.105-0.005
ReliaBrand Inc0.005+0.001
Sunrise Resources Ltd0.04+0.00
Mission Ready Services0.18-0.00
Decisive Dividend Corporation1.70-0.10

 





FEATURED Property
2163668518 Knowles Road
4 bedrooms 3 baths
$729,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


Calling on your help!

Has the internet flattened prices as predicted? Has the internet created opportunities for your business to find higher priced markets further afield? Is posting prices on your website a good thing o...


Living with Plan B

“It does not do to leave a live dragon out of your calculations, if you live near him.”― J.R.R. Tolkien, The Hobbit Photo: Thinkstock.comHuman beings are optimists by nature. Whether...


Reverse mortgage solution

With the housing and financial markets on solid footing, some retired Canadians may consider cashing in their growing assets to enjoy vacations and major home renovations. Others, on the other hand, a...

_



25979

26069


Member of BC Press Council


24875