The Economist, 2/20/2014 7:59 AM PST UK Only Article: standard article Issue: Putin’s inferno Fly Title: Cryptocurrencies Rubric: Bitcoin is growing too fast for its technology to keep up IN MOST businesses, a small coding error is a minor problem. With Bitcoin, an online “cryptocurrency”, a fairly simple flaw seems to have cost $5.3 billion. That is how much the value of all of the Bitcoin in the world has fallen over the past two weeks, after a bug caused several Bitcoin exchanges to halt withdrawals temporarily. The price of a Bitcoin, which peaked at about $1,200 in December, is now about $630 on Bitstamp, one of the exchanges that has resumed trading. On Mt Gox, another exchange based in Tokyo, coins that still cannot be withdrawn are selling for far less (see chart). The problems began with the discovery of a flaw in Bitcoin’s code at the start of February. Bitcoin is, in effect, a giant shared transaction ledger, recording who owns each individual unit of the currency at any one time. Everyone must use the same copy of the ledger—known as the “blockchain”—to prevent the same coins from ... |