The bitcoin used to cost close to Rs one lakh a piece just a few weeks back, but price have tumbled for various reasons including for problems at Mt Gox.
After three weeks of speculation about the fate of the Tokyo-based exchange, which had suspended withdrawals early last month, the bitcoin fraternity was stunned after Mt Gox claimed hackers stole a total of 850,000 coins.
Cyber criminals have been sporadically stealing bitcoins and its other siblings worldwide but this could be the biggest heist till date.
"There could be quite a few India whose bitcoins have got stuck at Mt Gox. We at least know three Indians who have got affected," said Sathvik Vishwanath, a founding member of Bitcoin Alliance India.
"The Mt Gox shutdown that happened did affect a lot of people. A few Indians we know have their BTC stuck there," said Sylvester, who is part of a well-known group that organises Bitcoin meetups in Delhi.
While the Mt Gox debacle has hit the fledgling bitcoin community hard, the incident has also exposed the weak security of bitcoins, which exist as small software, against sophisticated hacking attacks. However, some believe blaming the entire incident on unknown hackers could be a way to hide severe accounting or process deficiencies in this case.
"Because of their past delays, it was hard for Indian customers to transfer and receive fiat money from Mt Gox. But this could be a large-scale fraud as well. 8,50,000 coins globally can't be just stolen without coming under somebody's notice. It's next to impossible," said a bitcoin enthusiast, who works in a Bangalore headquartered IT firm.
The virtual currency's industry group, the Bitcoin Foundation, has sought to assure Bitcoin users that their funds won't disappear due to theft or mismanagement. On last count, there were 140 virtual currencies having a combined value of $9.3 billion.
Side by side, the US and Japanese prosecutors have started investigations into events leading to the eventual shutdown of Mt Gox. The European Banking Authority is working to set up a task force soon to review options for regulating Bitcoin and such virtual currency derivatives.
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