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Mt. Gox files for bankruptcy

February 28, 2014

One the world's largest Bitcoin exchanges, Mt. Gox has filed for bankruptcy in Japan while apologizing to clients for its faulty computer system. Lax security precautions appear to have led to massive hacking attacks.

https://p.dw.com/p/1BHQf
Crypto-currency bitcoin
Image: picture-alliance/AP

Filing for bankruptcy in Tokyo on Friday, Mt. Gox said it may have lost all of its investors' virtual Bitcoins due to hacking into its computers.

Appearing at a news conference in the Japanese capital, CEO Mark Karpeles apologized for the company's collapse, blaming a weakness in the firm's computer system. His announcement came after investors had been seeking answers for what happened to their holdings of cash and Bitcoins, an unregulated crypto-currency.

The website of Mt. Gox went down on Wednesday, with Karpeles reassuring investors later on that he was still in Japan and "working very hard with the support of different parties to find a solution to the recent issues."

Uncertain future

Mt. Gox had already halted all withdrawals from user accounts earlier this month, citing a flaw in Bitcoin software that "potentially allowed fraudulent transactions."

Bitcoin exchange Mt. Gox goes offline

The exchange was reported to have liquid liabilities of 6.5 billion yen ($63.67 million, 46.5 million euros), dwarfing its total assets of 3.84 billion yen.

Karpeles said in Tokyo he was intending to file a criminal complaint over what he said was a hacking attack, but gave no specific details.

hg/pfd (dpa, Reuters)