I don't believe the "Bitcoin were so popular that we couldn't handle the load" story.

Anyway, I know this was already posted, but here is a shorter version of the Alex Jones show where Mike Adams predicts a bitcoin crash and in fact mentions a "cooling off period", which is in fact in effect right now. He mentions the cooling off period that exists on Wall Street, and it's interesting that it's now in place to attempt to halt the bitcoin collapse.



MtGox's story doesn't make sense for a few reasons:

1) The mtgox.com server seemed to perform well throughout the day, as the crash was occurring. If there were really server problems, you would have found mtgox very difficult to reach. It actually handled everything better than I expected during the selloff, given both the increased number of transactions and the repeated reloads by interested outside parties (such as most people here).

2) Bitcoin has recovered quickly from DDoS attacks, which in fact did hinder the mtgox server in the past. No cooling off period was needed, and the value rocketed back up to where it was previously. So why is this time different, if again the crash in value was due to server issues?

3) The value of bitcoin FELL from around $170-$180 (where it had been stable for several hours) to $120 AFTER the announcement that it was just due to temporary server problems. That's not a good sign.


The simple fact remains that the bitcoin market is extremely easy to manipulate because, unlike the stock market, where most people are trading through experienced stock brokers (and the average person doesn't do much trading), bitcoin is being traded by investing n00bs whose only knowledge of trading markets is "buy low, sell high".

So it's not difficult at all to manipulate the average Joe's natural fears and desires.

I made a similar point in the StubHub thread, where I mentioned that StubHub price fluctuations were incredibly easy to predict given that the ticket sellers were average folks and not experienced ticket brokers.

I think most of Alex Jones' conspiracy stuff is nonsense, but it wouldn't be at all far-fetched to believe that this was being manipulated some way, either by the banking industry, the government, or just a few smart people who realized how to drive up the bitcoin market, get out at a certain target value, intentionally cause a crash, and then rebuy.

To be honest, all it really takes to manipulate bitcoin upwards is to make buy orders substantially above sell orders, and then do the reverse to bring it back down. The downward slope will, of course, be a lot steeper than the upward one.

It's incredibly easy to manipulate the bitcoin market because it's all anonymous. There's no way to tell who or what is buying up all the bitcoin or selling them rapidly, so that makes it incredibly easy to falsify mass interest or mass panic, thus inducing real mass interest and real mass panic.