updated 03:05 pm EST, Sat March 1, 2014
Total Bitcoins loss said to be 850,000 due to system weakness
Troubled Bitcoin exchange Mt. Gox filed for bankruptcy protection in Japan on Friday, breaking the silence on the company's position since suspending trading on February 24. The firm admits that it may have lost nearly half a billion dollars worth of the virtual currency when its systems were compromised by hackers. Mt. Gox is said to have $64 million in debts.
Approximately 750,000 Bitcoins belonging to customers and 100,000 coins belonging to the exchange, valued at over $450 million dollars as of March 1, were said to be lost in the hack when the Mt. Gox systems were breached unnoticed over the course of years. Mt. Gox says there was a also $27.4 million discrepancy in its bank accounts as of Monday.
Reuters reports that Mt. Gox CEO Mark Karpeles, who appeared in a suit rather than his standard T-shit, "bowed in contrition and apologized in Japanese at a news conference at the Tokyo District Court, blaming his firm's collapse on a 'weakness in our system,' but predicting that Bitcoin would continue to grow."
Mt. Gox is said to be looking into approaching the hacking and subsequent theft as a criminal matter, as it "believes there is a high possibility that the Bitcoins were stolen." Customers who had coins with the exchange have little hope of recovering the funds since the currency isn't federally regulated, nor was the exchange significantly backed.
A lawsuit has been filed in Chicago against Mt. Gox on Thursday alleging that the company had failed "to provide its users with the level of security protection for which they paid."