Bitcoin Warning Signs for New Investors

Bitcoin warning signs for new investors are increasing rapidly as negative reports tarnish the once bright image of the world’s leading digital currency. Before the spectacular collapse of the Mt. Gox Bitcoin Exchange on February 7, 2014, after an estimated 745,000 Bitcoin worth approximately $9.5 billion went missing, the only people who were aware of Bitcoin’s promise of a fast track to easy wealth were computer geeks and currency traders. Stories about Bitcoin billionaires surfaced and disappeared again as the news media, obsessed with Obamacare, failed to pick up on them.

After Mt. Gox collapsed, Bitcoin suddenly became front page news all over the world, and millions of would-be Bitcoin miners have been looking for a way into the business ever since, despite recent Bitcoin warning signs, including an IRS decision to tax Bitcoin as real property, ending a presumed tax exemption for Bitcoin currency speculators. Russia, China, Australia, New Zealand and Iceland have either banned or restricted the use of Bitcoin within their jurisdictions. Iceland released its own auroracoin digital currency on March 25, issuing 31.8 coins (equal to $400 US) of the currency to each citizen in an attempt to revive the country’s moribund economy. Since then, auroracoin’s value has dropped from $12.58 per coin to $1.16.

The most telling blow to strike the embattled digital currency movement has been the precipitous collapse of Bitcoin values, which have fallen from a record high of US $1124.74 on November 29, 2013 to $423. Nevertheless, more and more people are looking at Bitcoin mining as a means to fast, easy money. Those numbers are reflected in the shrinking earnings in the Bitcoin mining industry. Last week, miners’ weekly earnings were down by 40.9 percent to $14.9 million compared to weekly earnings of $25.2 million in December, before the bad news began to accumulate.