As the world’s most popular Bitcoin exchange, Mt. Gox sees a huge amount of traffic with thousands of users each day transferring money into the exchange to buy the virtual currency, or else to sell their Bitcoin and withdraw US dollars or some other currency. Now, it’s claiming that the levels of traffic are so high that it’s having difficult keeping up with requests for US dollar cash withdrawals, prompting it to suspend all such transactions for two weeks.

Mt. Gox made the announcement late last night, saying that both its customer base and the number of deposits and withdrawal requests it receives has steadily been growing over the past few months. As such, the length of time it takes to process each transaction has been growing too, and now the exchange claims it’s having trouble meeting demand.

Due to the its increased traffic, Mt. Gox says that thousands of its customers have been experiencing delays, and that these are most pronounced in the US. In order to mitigate these problems, Mt. Gox has said that withdrawal requests made in US dollars will not be processed for the next two weeks.

“We are currently making improvements to process withdrawals of United States Dollar (USD) denominations, and as a result are temporarily suspending cash withdrawals of USD for the next two weeks.”

“Please be reassured that USD deposits and transfers to Mt. Gox will remain unaffected, as will deposits and withdrawals in other currencies, and we will be resuming USD withdrawals once the process is completed.”

Mt. Gox points out that customers in other parts of the world won’t be affected. The exchange will continue to accept deposits in US currency, and deposits and withdrawals in other currencies won’t be affected.

Problems Piling Up?

Mt. Gox has gone out of its way to reassure customers that everything will be back to normal in a couple of weeks, but the reality is that more than a few people will be suspicious of its latest move. The company has lurched from one troublesome episode to another in recent weeks, including fending off a spate of DDoS attacks thought to be part of an attempt to manipulate the price of Bitcoin; a huge drop in the value of the cryptocurrency that occurred after the site began experiencing delays; a $75 million law suit filed against it by the US Bitcoin startup CoinLab over an alleged breach of contract; and its mysterious absence from this year’s Bitcoin 2013 convention.

On top of all these problems, Mt. Gox was recently placed under investigation by the US Department of Homeland Security, which seized control of its Dwolla account last month. Meanwhile, the US Immigration and Customs Enforcement recently froze Mt. Gox’s US-based funds over allegations it’s in breach of financial regulations.

Some commentators are already speculating that Mt.Gox could be running out of cash and that’s why it’s suspending US dollar withdrawals. Whether or not that’s true remains to be seen, but one thing we can be sure of is that plenty of people are going to be frustrated by this move. After all, what’s the point of investing in something as volatile as Bitcoin if you can’t cash when you want to?