Bitcoin Gaining New Momentum

NEWS ANALYSIS: The collapse of Mt. Gox in February has lowered the value of Bitcoin, but it hasn't dampened enthusiasm for the cryptocurrency revolution.

At the end of February, Mt. Gox, the one-time leading exchange for the Bitcoin cryptocurrency, collapsed, declaring bankruptcy and leaving the future of Bitcoin itself in doubt. Two months after the Mt. Gox debacle, there are multiple signs in the market that demonstrate continued enthusiasm and support for Bitcoin.

On April 30, financial services market information vendor Bloomberg announced that it will be including Bitcoin pricing on its Bloomberg Professional service, which has more than 320,000 global subscribers.

"Clients are increasingly interested in Bitcoin and other digital currencies and are looking for tools to better monitor developments in these markets," Bloomberg stated in a news release.

Although Bloomberg customers can now get pricing and Bitcoin market information, they cannot actually trade Bitcoin on the Bloomberg platform. While Bloomberg expressly notes in its release that it is not endorsing Bitcoin, the simple fact that Bitcoin information is now available on Bloomberg does serve as validation that there is still intense interest in the cryptocurrency.

In addition to Bloomberg, students at the Massachusetts Institute of Technology (MIT) have started a Bitcoin Club and plan to give $100 U.S. worth of Bitcoin to all undergraduate students at MIT. The club, led by students Jeremy Rubin and Dan Elitzer, has already raised $500,000 from MIT alumni to help cover the costs to distribute the Bitcoins to 4,528 MIT undergraduates this fall.

"Giving students access to cryptocurrencies is analogous to providing them with Internet access at the dawn of the Internet era," Rubin said in a statement. "When the distribution happens this fall, it will make the MIT campus the first place in the world where it will be possible to assume widespread access to Bitcoin."

The MIT effort could be the start of bigger things to come for Bitcoin across university settings. Let's not forget that Facebook started out as a project just to connect Harvard University students, and today it's the world's largest social network.

A Comeback for Mt. Gox?

Mt. Gox, which has been offline since February, might also make a comeback. On April 28, Sunlot Holdings announced a deal to settle a class-action lawsuit that was brought against Mt. Gox after the exchange filed for bankruptcy. The class-action lawsuit represented approximately $200 million in losses incurred by an estimated 50,000 Mt. Gox customers.

The Sunlot Holdings group is not actually an owner of Mt. Gox and wasn't named in the class-action lawsuit either. Sunlot, however, is aiming to take over and restart Mt. Gox rather than have the entire exchange liquidated.

"Liquidation would have adverse consequences for Mt.Gox customers and the entire Bitcoin community," Sunlot investor William Quigley, a partner at Clearstone Venture Partners, said in a statement. "Millions of dollars worth of lost bitcoins would never be recovered and most of Mt.Gox's assets would go to paying bankruptcy lawyers and others involved in the process rather than customers."

Sunlot Holdings currently runs the Website, which is leading the campaign to rebuild Mt. Gox.

As eWEEK reported back in February, the end of Mt. Gox wasn't likely the end of Bitcoin. As it turns out, the bankruptcy of Mt. Gox wasn't actually the death of Mt. Gox either. Interest in Bitcoin remains high and though there have been some bumps in the road, it is a road that is still being traveled.

Sean Michael Kerner is a senior editor at eWEEK and Follow him on Twitter @TechJournalist.

Sean Michael Kerner

Sean Michael Kerner

Sean Michael Kerner is an Internet consultant, strategist, and contributor to several leading IT business web sites.