Alex Krusz knew he should have pulled his bitcoins out of the Mt.Gox trading website. He sensed trouble early on.
The website was riddled with technical problems -- slow to process withdrawals and displaying user passwords in plain text.
But like many others who used Mt.Gox to buy and sell bitcoins, Krusz found that it was much easier to deposit funds than it was to get them back. When Krusz tried to withdraw bitcoins from the Tokyo-based exchange last year, Mt.Gox suddenly demanded extra verification: a photo ID, a copy of a utility bill and a short questionnaire. He never got around to it.
Then Mt.Gox took down its website this week, putting in jeopardy more than $400 million of bitcoins held by its customers.
Krusz, a 30-year-old web developer in Somerville, Mass., feels like his 1.2 bitcoins, valued at $700 today, were pickpocketed.
"I don't ever expect to get that back," he said. "It's not going to break me, but in the long run, I've probably lost more than that because I think Bitcoin will continue to grow in value."