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Bitstamp restores service after targeted attack

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bitcoin casascius
bitcoin casascius

Bitstamp restored service to its Bitcoin exchange this morning, four days after suspending withdrawals in the wake of an attack on its network that raised new concerns about the security of digital currency exchanges. "After rigorous testing, we have restored fully automated processing for Bitcoin withdrawals," the exchange said, according to the Wall Street Journal. Meanwhile, Mt. Gox said it has suspended deposits while it investigated a denial-of-service attack on Bitcoin's core infrastructure.

The problems stem from a vulnerability known as "transaction malleability," which refers to an issue that would allow a user to alter transaction details to make it seem as if a transfer failed when it had actually succeeded. This week, Bitcoin core developer Jeff Garzik told The Verge that the issue is more widespread than the team initially realized. "It's mainly a nuisance," he said, "forcing everybody to stop and fix their website software and Bitcoin wallets."

Investors don't appear to be too concerned about the vulnerabilities: Bitcoin's price rose 9.73 percent on Friday, and now sits at $651.86. But the ongoing security issues show that the digital currency has a long way to go before exchanges are as secure as banks.