Bitcoin's Secret History: The Price of Bitcoin Has Changed

Source: Hash Pie

Author: LucyCheng

Mt.Gox, meaning Magic: The Gathering Online eXchange, a magical online trading platform. This largest trading platform in the history of Bitcoin, as the name suggests, left many magical events in the field during the operation. In addition to the 442,000 BTC huge transaction mentioned in the previous story and the wrong hand to destroy Bitcoin, etc., the platform also had a BTC price fluctuation event.

Image source: Blockonomi

For Mt.Gox, 2011 has been an eventful year. The exchange had just completed two hacking incidents in early March and late May, and another cent of Bitcoin farce was ushered in mid-June. According to BitMEX data, around midnight on June 20, 2011, Beijing time, a shocking market appeared on the Mt.Gox platform, and the price of Bitcoin plummeted from about $ 17.5 to $ 0.01 in a very short period of time. At that time, the users who were the first to know the news immediately joined the bottom-up army. Within a period of time, a large number of orders appeared on the platform, and the Mt.Gox service was temporarily interrupted.

After things continued to ferment for half an hour, the price of Bitcoin gradually returned to normal, rising back to about $ 13. The mad plunge without warning has attracted great attention from the market, and some people even suspect that there may be problems with the Bitcoin network. But then we all know that this incident was caused by a vulnerability in the Mt.Gox platform.

Bitcoin trading volume during the Mt.Gox price crash (Source: BitMEX Research)

The exchange issued an official statement more than an hour after the incident, explaining that the abnormal price was caused by the hacking of the founder Jed McCaleb's account. On the same day, Jed's account was breached by an IP address from Hong Kong, and the hacker used the database management authority of the account to conduct low-price trading operations and obtain a large amount of bitcoin. Fortunately, at the time, the Mt.Gox platform had restrictions on daily cash withdrawals not to exceed 1,000 US dollars and withdrawals not to exceed 2000 BTC, so even if hackers bought a large amount of bitcoin at a low price, they could only withdraw 2000. BTC.

At that time, a large number of people questioned Mt.Gox's failure to disclose the truth, thinking that the stolen bitcoin in this incident may be far more than that; and another part of users who did not catch up with 1 cent bitcoin was deeply disadvantaged, but later The exchange announced that it would roll back all transactions during abnormal prices.

Attacks Mt.Gox experienced in 2011 (Source: Cracking Mt.Gox, BitMEX Research)

After this bitcoin price fluctuation, Mt.Gox's trading volume fell into the doldrums in the following weeks, and many users were skeptical of the exchange's solvency. Not only that, the platform's paper-like security measures have gradually been seen by the general public; but Mt.Gox quickly rose again by the leading position at the time and the background of bitcoin exchanges, until 850,000 in 2014 Multi-Bitcoin went missing before it completely collapsed.