Bitcoin Transaction Have Gone Horribly Wrong

A Bitcoin transaction appears to have gone horribly wrong after a hapless user accidentally charged themselves $137,000 (£94,000) over trying to make a $5 transaction.

The transaction, which took place on Tuesday, details how the sender apparently intended to transfer 0.0001 BTC (around $5, or £3.44) to a recipient, but was charged 291,2409 BTC or $137,000 to do so.

The enormous sum would have been paid to BitClub, the bitcoin network processing the transaction rather than the intended recipient, as Motherboard points out.

Bitcoin, an encrypted currency that relies on a decentralized ledger of transactions known as the blockchain, rather than central banks, for legitimacy, has found legions of online fans, if not mainstream acceptance.




Earlier this year, one of Bitcoin’s top developers claimed the movement was doomed, and the virtual currency had failed. Mike Hearn, a British programmer who quit a job at Google to work on developing Bitcoin full time two years ago, said it is controlled by China and that the network it relies upon “is on the brink of technical collapse”.

“There’s no longer much reason to think that Bitcoin can be better than the existing financial system,” Hearn wrote in a lengthy parting shot at sections of the movement.

“The fundamentals are broken and whatever happens to the price in the short term, the long term trend should probably be downwards. I will no longer be taking part in Bitcoin development and have sold all my coins.”

London-based technology company Elliptic, which attempts to fight crime by spotting suspicious Bitcoin deals, raised $5m (£3.5m) last month. The company claims to help solve one of the biggest challenges of Bitcoin for companies that use it – the inherent anonymity, which means banks are reluctant to embrace it for fear of falling foul of anti-money laundering regulation.

Bitcoin

What is it?
A digital currency, used to make payments of any value without fees. It runs on the blockchain, a decentralised ledger kept running by “miners” whose powerful computers crunch transactions and are rewarded in bitcoins

Who invented it?
Satoshi Nakamoto, a secretive internet user, invented bitcoin in 2008 before it went online in 2009. Many attempts to identify Satoshi have been made without conclusive proof




What’s it for?
People see value in money free from government control and the fees banks charge, as well as the blockchain, to verify transactions. Bitcoin has been seen as a tool for private transactions, and the payment of choice for drug deals and other illegal purchases.

Is it worth anything?
Yes. As of December 2015, there are around 15m bitcoins in circulation, worth £275 each or some £4bn in total

Source: telegraph.co.uk