The Russian Federation declared virtual currencies illegal. Then Bitcoin exchange, Mt.Gox, suspended all withdrawals. The result was a fall in the value of the Bitcoin.

Mt.Gox released a statement on Friday saying that they had encountered a glitch when there was a high volume of currency withdrawal requests.

"We apologize for the sudden short notice," the statement read. "All bitcoin withdrawal requests will be on pause, and the withdrawals in the system will be returned to your MtGox wallet and can be reinitiated once the issue is resolved. The trading platform will perform as usual for the needs of our customers."

A senior Mt.Gox staffer indicated that the withdrawal problems were a "complex technical issue" and had no implications for the company's own solvency or the liquidity of customers' accounts.

The General Prosecutor of the Russian Federation stated that the trading of Bitcoins as well as other cyber currency was illegal.

"In accordance with Art. 27 of the Federal Law 'On the Central Bank of the Russian Federation', the official currency of the Russian Federation is the ruble ... Bitcoin are money substitutes and cannot be used by individuals and legal entities," reads a Google-translated version of the guidance.

Previously being valued at $900, the value of the Bitcoin fell to $660 before becoming stable at around $760.