Bitcoin

Mt. Gox Files For US Bankruptcy Protection — Bitcoin News Roundup

Will halt U.S. legal action against the Bitcoin exchange

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The latest news on Bitcoin: Mt. Gox has filed for U.S. bankruptcy protection, a move that will stop U.S. legal action against the Bitcoin exchange, which is based in Japan.  

Previous news on Bitcoin: 

Hackers who targeted the CEO of Mt. Gox, a Japanese bitcoin exchange that claimed to have lost hundreds of millions of dollars in bitcoin, say they're convinced the CEO is hoarding the bitcoins the company says are stolen.

The man Newsweek identified as the creator of Bitcoin, Satoshi Nakamoto, is now trying to avoid the press while denying that he is the currency's founder.

American Autumn Radtke, CEO of a virtual currency exchange called First Meta, was found dead at the end of February in Singapore but not widely reported until March. Police do not suspect foul play.

Newsweek reports on the search for Satoshi Nakamoto, which it says is a 64-year old Japanese-American living in San Bernardino named Satoshi Nakamoto.

Bitcoin bank Flexcoin has shut down following a March 2 hacking that robbed it of all its virtual currency.

A Mt. Gox customer filed suit in Chicago February 28 against the Japanese exchange, attempting to start a class action claim for all American customers who lost money.

The Bitcoin exchange Mt. Gox filed for bankruptcy and blamed hackers for the loss of hundreds of millions of dollars worth of the digital currency. 

West Virginia Senator Joe Manchin is calling on financial regulators to ban the virtual currency, calling it a tool for laundering money and a threat to the U.S. economy.

According to a "crisis strategy draft" plan said to have been created by Mt. Gox, the Bitcoin exchange has lost around $350 million worth in Bitcoin after a years-long hacking campaign.

Wired is reporting that "Bitcoin insiders" had been preparing for bad news from Mt. Gox for weeks, although the scale of the theft took many by surprise.

Responding to the news, bitcoin wallet-makers Coinbase and Blockchain released a joint statement saying, "There are hundreds of trustworthy and responsible companies involved in bitcoin."

From Wired:

The hacking attack is detailed in a leaked "crisis strategy draft" plan, apparently created by Gox and published Monday by Ryan Selkis, a bitcoin entrepreneur and blogger (see below). According to the document, the exchange is insolvent after losing 744,408 bitcoins — worth about $350 million at Monday's trading prices. The plan paints a bleak picture of the exchange's finances and outlines an arbitrage scheme to restore the exchange to solvency. "The reality is that Mt. Gox can go bankrupt at any moment, and certainly deserves to as a company," the document states.

CNN is reporting that Mt.Gox CEO Mark Karpeles resigned from the Bitcoin Foundation's board of directors last weekend.

The Mercatus Center's Jerry Brito breifly mentioned the slow implosion of Mt. Gox in his article for Reason.com yesterday titled "Is Bitcoin the Key to Digital Copyright?"

More from Reason.com on Bitcoin here.