A tragic end to the down-spiraling MtGox saga, as the company has today filed for Bankruptcy protection, and said it may have lost all of its investor’s Bitcoins due to hackers cracking into its faulty computer network systems, dispelling rumors that they may have access to a portion of the funds.
The firm’s CEO Mark Karpeles said at a Japanese news conference regarding the companies demise, point blame at “a weakness in our system,” as quoted by Rueters, and told the news conference that MtGox wanted to file criminal complaints against the alleged hackers but had no specific means to make a basis for the charges.
The Tokyo-based exchange was once the world’s largest bitcoin venue, and the events of recent weeks that have now led to the company’s bankruptcy had sent shockwaves through the bitcoin community and through the crypto-currency world as other leading digital currency contenders seek to build credibility in the acceptance of the new-age method of electronic currency.
Changing the Face of AML with Self Service AnalyticsGo to article >>
According to the filing MtGox had liabilities of 6.5 billion Yen or roughly $63.67 million, and assets of only 3.84 billion yen (nearly half its liabilities), and 127,000 creditors in the bankruptcy, a thousand of which are Japanese customers. An un-confirmed document circulating on the internet claimed that nearly 750,000 bitcoins could be at stake at Mt. Gox, worth over $400million at current rates, a loss that could ripple against clients involved who may now become creditors seeking a settlement.
The filing isn’t’ exactly like a Chapter 11 under US code, as in this case it’s filed under Japanese Law, and may be worked through for some sort of resolution between affected parties.
Just yesterday Japanese Vice Finance Minister Jiro Aichi had said, “any regulation of the bitcoin crypto-currency should involve international cooperation to avoid loopholes.” In addition, on Thursday, in front of a Senate committee, Federal Reserve Chair Janet Yellen said that the fed has no jurisdiction over bitcoin but that Congress should consider ways to regulate such virtual currencies , also quoted in the press.