Investing.com - Bitcoin prices plunged on Wednesday, after the two largest Bitcoin-trading exchanges came under attack from hackers in the latest development to roil the virtual currency.
Slovenia-based Bitstamp said it halted customer withdrawals to deal with the issue on Tuesday night. BTC-e, which is based in Bulgaria, said it was also experiencing delays in crediting certain transactions.
Both exchanges described the problem as a denial-of-service attack, according to comments made by the companies on their websites. In denial-of-service attacks, hackers essentially disable a website by flooding it with information requests.
BitStamp is the world’s largest Bitcoin exchange, while BTC-e is the second-biggest.
The news comes after Tokyo-based Bitcoin exchange Mt. Gox was forced to halt all Bitcoin withdrawals due to a technical issue late last week.
Mt. Gox was once the world's largest Bitcoin trading exchange, with volume topping 1 million trades a day at its peak. It is now the third-largest Bitcoin exchange.
BTC/USD tumbled 8.9% to trade at USD514.00 on Mt. Gox.
The price of a Bitcoin last traded at USD653.50 on BitStamp, while prices on BTC-e traded at USD641.10.
According to the CoinDesk Bitcoin Price Index, which averages prices from exchanges including Mt. Gox, prices of the crypto-currency dropped 2.75% to hit USD651.00.
Bitcoin is digital cash for the internet and it is not backed by a government or central bank to regulate or issue it. It can be used to purchase goods and services from stores and online retailers.
Prices of the virtual currency soared to an all-time high of USD1,241.10 on November 29. It was trading at USD100 in early October.