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Bitcoin On A Roller Coaster As Exchanges Crash

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Bitcoin, the cryptocurrency highly in demand, has been on a roller-coaster ride as it fell over 20 percent from a record high on Wednesday in a period of wild trading.

Bitcoin exchanges crashed after the heaviest selling seen amid reports of service outages and delays on some of the largest online exchanges.

Over the last few hours, major cryptocurrency exchanges Coinbase and Gemini faced a difficult time to complete transactions. Massive spikes in traffic was said to be the cause for the unspecified problems.

In a related development, Coinbase reportedly received demands from US courts to turnover transaction documents. Professor Alan Woodward, a security expert from University of Surrey, tweeted that Coinbase has been subpoenaed with a request for records of all transactions in amounts over $20,000 between 2013 and 2015.

Price of the digital currency had touched $11,434 in US trade on Wednesday, but slipped to $9,009. It was trading at $9,911.10 as of 3:36 p.m. in New York.

A year ago, the currency, which works like virtual tokens, was worth less than $800, touching $1,000 at the start of the year. The currency has fluctuated wildly since it was launched in 2009. In a day, a steady stream of about 3,600 new Bitcoins are created, with about 16.5 million now in circulation, while the maximum limit is 21 million.

Amid the wavering movement, critics warn investors of a bubble similar to that of dotcom boom. A Bank of England deputy governor reportedly warned that investors should do their homework on Bitcoin.

Sir Jon Cunliffe, the Bank's deputy governor for financial stability, told the BBC, "People need to be clear this is not an official currency. No central bank stands behind it, no government stands behind it."

According to some, the rising in price is because, it is crossing into the financial mainstream.

by RTT Staff Writer

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