Mt. Gox delays plan to support virtual currency litecoin
Bitcoin exchange Mt. Gox has temporarily shelved plans to support a competing currency, litecoin, the company said Thursday.
Mt. Gox, which is the largest bitcoin exchange, has been battling ongoing distributed denial-of-service (DDoS) attacks that caused it to delay launching an exchange for litecoin, a lesser known virtual currency designed to improve on some of bitcoin’s weaknesses.
The Tokyo-based exchange said in a news release it was planning to support litecoin two weeks ago “but events derailed that plan. Right now we are focused on overall stability of the exchange and will launch LTC [litecoin] when we are ready. Otherwise we could be further complicating things.”
Bitcoin’s price has seen dramatic swings since January, in part due to continued attacks that Mt. Gox believes are intended to manipulate its price. Attackers have conducted DDoS strikes on Layer 7, which is the application protocol layer including protocols such as HTTP, FTP and SMTP.
The attacks are hard to detect and “make it difficult to distinguish malicious traffic from normal traffic,” Mt. Gox said.
Mt. Gox employes the services of Prolexic, a company based in Florida that runs a network of data centers designed to filter malicious traffic. Mitigating a DDoS attack takes some time, however, and Mt. Gox has experienced outages during attacks.
Mt. Gox’s decision to support litecoin marks increasing interest in virtual currencies. Similar to bitcoin, litecoin uses a peer-to-peer network that harnesses the computing power of the network to generate new coins, known as “mining,” and to confirm that transactions are legitimate.
One of bitcoin’s weaknesses is that it can take upwards of three hours to confirm a transaction, although most are verified by the network within an hour. Litecoin’s network provides verification of transactions in less than three minutes, according to the project’s website. Litecoin mining can also be done on consumer-grade hardware, whereas bitcoin mining now requires advanced, specialized hardware to be efficient.