Mt. Gox Goes Bankrupt

Company says it lost 750K of customers' bitcoins
By Kevin Spak,  Newser Staff
Posted Feb 28, 2014 7:29 AM CST
Mt. Gox Goes Bankrupt
Mt. Gox CEO Mark Karpeles, sitting at second right, attends a press conference at the Justice Ministry in Tokyo Friday night, Feb. 28, 2014.   (AP Photo/Kyodo News)

Mt. Gox is filing for bankruptcy protection, CEO Mark Karpeles announced at a press conference today, saying the bank may have lost 750,000 of its customers' bitcoins ("essentially all of them," reports the New York Times), along more than 100,000 of its own. At current prices, that's a $480 million loss.The company also said there was a $27.4 million discrepancy in its bank accounts, Reuters reports. "I'm very sorry," said Karples, who bowed in contrition. "The bitcoin industry is healthy and it is growing. It will continue, and reducing the impact is the most important part."

The company filed for a Japanese bankruptcy protection that will allow it to restructure, with the assigned bankruptcy supervisor also tasked with handling its 127,000 creditors; doing so could take years, notes the Times. The company has $64 million in debt, and just $38 million in assets. Meanwhile, dozens of bitcoin aficionados gathered in Tokyo last night to discuss legal action, the AFP reports. "What happened at Mt. Gox was first incompetence, but then it could have gone to fraud at the end," said one American who lost more than $200,000 worth of bitcoins. If that's the case, "Karpeles should face justice and go to jail." (More Mark Karpeles stories.)

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