Tokyo bitcoin exchange files for bankruptcy

The Mt. Gox bitcoin exchange in Tokyo filed for bankruptcy protection, acknowledging that a significant amount of the virtual currency had gone missing.

The exchange’s CEO Mark Karpeles appeared before Japanese TV news cameras on Friday, bowing deeply for several minutes.

Speaking in Japanese at a Tokyo court, he apologized for the troubles he had caused to so many people.

Kyodo News said debts at Mt. Gox totalled more than 6.5 billion yen ($65 million), surpassing its assets.

The exchange’s unplugging this week drew renewed regulatory attention to a currency created in 2009 as a way to make transactions across borders without third parties such as banks.

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.

Big Bitcoin losses spur Mt. Gox to bankruptcy filing

Mt. Gox, the embattled Bitcoin exchange, has filed for bankruptcy protection after falling into a state of disarray earlier this month in the wake of a security issue that prompted withdrawal fraud.

The exchange's CEO, Mark Karpeles, announced the news in Tokyo on Friday, saying that Mt. Gox lost nearly 750,000 customer bitcoins, as well as 100,000 of the exchange's own bitcoins. The total number of lost bitcoins translates to nearly $500 million, the Wall Street Journalreported on Friday.

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.