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PODCAST: Bitcoin mystery

The Bitcoin website.

So far this has not been a good year for Bitcoin. In fact, today appears to be a terrible day for Bitcoin's most prominent exchange, Mt. Gox. The website was recently hacked and criticized for not plugging a long-open security hole. And news of another apparent theft from the site this week has many expecting Mt. Gox to file for bankruptcy.

So how did such a major player in the Bitcoin market take such a tumble? To understand, it helps to start at the beginning. Mt. Gox began life as an online platform to trade Magic cards. Yes, those magic cards. In fact, the name of the site is an acronym that stands for "Magic: The Gathering Online Exchange." It was started by an unemployed hacker named Jed McCaleb. In 2010, McCaleb switched the site's function to handle Bitcoin-to-U.S. dollar trades. Over the next year, Mt. Gox became hugely popular, leading to the sale of the site to Tokyo-based hacker Mark Karpeles in 2011. Under Karpeles' leadership, Mt. Gox became a trusted entity in the world of Bitcoin.

Also, President Obama is set to announce a pair of manufacturing innovation institutes in Chicago and Detroit on Tuesday. The public-private partnerships come with $140 million in federal grants, plus millions in private funding, to develop the next generation of manufacturing technologies and workers. Back in the day, Chicago was such a huge manufacturing town, it was nicknamed "city of the big shoulders."

About the author

David Brancaccio is the host of Marketplace Morning Report. Follow David on Twitter @DavidBrancaccio

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