Bitcoins, which exist in electronic form, depend on a network of computers that solve complex mathematical problems to verify and record every transaction. Investors deposit their bitcoins in digital “wallets” at various exchanges. Bitcoin deposits have no government-backed insurance as bank accounts do. Instead, customers have the same legal remedies as anyone who entrusts property to an institution that fails to protected it adequately.
Mt. Gox was the largest exchange, but it and other exchanges halted withdrawals after a series of cyber attacks. Customers were unable to access their accounts.