Finally, Mt. Gox has collapsed. It has filed for bankruptcy protection with an outstanding debt of ¥6.5bn ($63.6m). The Bitcoin exchange has also admitted that 750,000 of its customers’ Bitcoins and 100,000 of the company’s own have been lost in the debacle. It may appear that Mt. Gox collapsed suddenly; however, ForexMinute has been reported the slow decline of the exchange for long.
Talking to media professionals, the exchange’s lawyer announced that the company is extremely sad about what happened. The appearance of the company’s CEO Mark Karpeles showed that he was disgraced with the ugly outcomes. He was seen bowing down in front of media. The unexpected collapse also lays bare the difficulties the Bitcoin community faces.
Mt. Gox Collapse: A Journey from Top Bitcoin Exchange to Disgraceful Decline
The collapse also raises several questions on the ideas that Bitcoin is built on. Will the non-interventionist and liberal ideals that Bitcoin is trying to propagate get acceptance now will also be a serious concern.
Mt. Gox declares that it may have lost nearly half a billion dollars worth of the virtual coins due to hacking into its faulty computer system. What will happen to the investors who lost their investments is not yet clear. The governments are also worried about the repercussions of more such instances.
Earlier, ForexMinute reported that US federal prosecutor subpoenaed the Bitcoin exchanges to seek information on a recent spate of disruptive cyber attacks. Ironically, Mt. Gox which was once a proponent of probity in Bitcoin market fell to it. Its CEO Mark Karpeles was one among the people who were vocal a lot for legitimizing the digital currency.
Fall from Grace for Karpeles
Karpeles had then voiced that Mt. Gox had no interest in helping criminals launder funds. Then he had also said that his company wanted authorities to understand that the problem was not Bitcoin, but what some people do with those. Now, if his own statement is kept in mind, it looks, it is his own company that is responsible for what all happened.
Bitcoin which hit $1200 in November last year was reaching to freaking heights; however, Mt. Gox was not the major beneficiary of the gain. In fact, since the mid of 2013 Mt. Gox started losing the sheen as several technical glitches came appearing. Its market share declined as several other Bitcoin exchanges like BitInstant, Bitstamp, etc. came up.
The words from Karpeles, “First of all, I’m very sorry,” sums up everything. He should be sorry for letting down thousands of investors and bringing down Bitcoin to new criticism. Though he said that the Bitcoin industry is healthy and it is growing, underneath he knows that Mt. Gox’ collapse has generated a new controversy on the legitimacy of Bitcoin.
To contact the reporter of this story: Deepak Tiwari at email@example.com