Imagine a world where the Nasdaq, the Nikkei and the FTSE all failed within the span of a week and you have an idea how crazy the world of virtual currency trading has become. Wired reports that a new study from computer scientists Tyler Moore of the Southern Methodist University in Dallas and Nicolas Christin of Carnegie Mellon University has found that 45% of Bitcoin exchanges end up shutting their virtual doors while leaving their users’ money in limbo. However, this doesn’t mean that the Bitcoin exchanges that have survived so far are safe havens, since the study also shows that they’re under constant assault from cybercriminals who are working around the clock to hack users’ transactions.
“Exchanges handling 275 Bitcoins’ worth of transactions each day have a 20 percent chance of being breached, compared to a 70 percent chance for exchanges processing daily transactions worth 5570 Bitcoins,” wrote Moore and Christin, who also estimated that all new Bitcoin exchanges have a 30% chance of closing within a year of opening.
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Looking at the big picture, then, Bitcoin exchanges look less like stable trading markets and more like a Gotham City that’s being attacked by Scarecrow, the Joker and Bane all at the same time.
This article was originally published on BGR.com
- Carnegie Mellon University