BITCON, Mark Karpeles says Mt. Gox lost some 750,000 customer bitcoins, plus 100,000 of its own

The massive loss of bitcoins had been rumored all week, though Mt. Gox would not confirm the news. Due to the currency's encryption technology, it might be difficult, if not impossible, for the stolen bitcoins to be restored to their owners' accounts, leaving people across the globe with significant losses.

At its height, Mt. Gox was one of the most popular Bitcoin exchanges. It was often cited in news stories discussing the startling rise of the Bitcoin phenomenon, which at one time, flirted with a $1,000 currency exchange.

Mt. Gox's Karpeles acknowledged that the bitcoins were stolen through a weakness in his company's system that allowed hackers to slowly withdraw the currency.

According to Karpeles' lawyer, Mt. Gox has $63.6 million in debt, and about half that in assets. Even with the filing for bankruptcy protection, Karpeles would like to see Mt. Gox live on and come back, though it's not clear whether that will happen or whether customers would come back and use the exchange. In the meantime, Mt. Gox has been shuttered.