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Troubled Bitcoin Exchange Mt. Gox Files for Bankruptcy

Angela Moscaritolo
 & Angela Moscaritolo Managing Editor, Consumer Electronics

Our team tests, rates, and reviews more than 1,500 products each year to help you make better buying decisions and get more from technology.

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Mt. Gox, formerly the world's biggest bitcoin exchange, filed for bankruptcy protection in Japan on Friday, saying it has lost nearly half a billion dollars worth of the digital currency following cyberattacks on its computer systems.

The move comes just days after Mt. Gox mysteriously went offline, halting trades of the crypto-currency.

Mt. Gox's French CEO Mark Karpeles, who had not been seen in public for several days, reemerged Friday"wearing a suit instead of his customary T-shirt" and apologized, blaming the collapse on a weakness in the company's systems, according to Reuters.

"First of all, I'm very sorry," Reuters quoted him as saying. "The bitcoin industry is healthy and it is growing. It will continue, and reducing the impact is the most important point."

Despite his optimism, Mt. Gox's lawyer said the company has lost 750,000 of its customers' bitcoins, in addition to its entire stash, estimated at around 100,000 units. With the current bitcoin price at about $565, that translates to around $480 million, or about 7 percent of the estimated global total of bitcoins, Reuters noted.

At the bankruptcy hearing, Mt. Gox also said it had outstanding debts of about JPY 6.5 billion ($63.7 million), compared to assets of just JPY 3.84 billion.

Karpeles on Sunday resigned from the board of the Bitcoin Foundation following a string of technical issues starting last summer when Mt. Gox halted customer withdrawals in the U.S. Problems intensified this month when Mt. Gox froze customer withdrawals due to a bug in its software.

Earlier this week, a document posted on Scribd.com purporting to be a Mt. Gox "crisis strategy draft" said that 744,408 bitcoins were missing "due to malleability-related theft which went unnoticed for several years." The exchange has also removed all the tweets from its Twitter account and unfollowed everyone it had been following.

Angry investors have been protesting outside of Mt. Gox's headquarters in Tokyo this week, demanding to know where their money is. At this point, it looks like their chances of seeing their funds again are pretty grim.

For more, see: Everything You Need to Know About Bitcoin. Also, check out PCMag Live in the video below, which discusses Mt. Gox's bankruptcy.

About Our Expert

Angela Moscaritolo

Angela Moscaritolo

Managing Editor, Consumer Electronics

My Experience

I'm PCMag's managing editor for consumer electronics, overseeing an experienced team of analysts covering smart home, home entertainment, wearables, fitness and health tech, and various other product categories. I have been with PCMag for more than 10 years, and in that time have written more than 6,000 articles and reviews for the site. I previously served as an analyst focused on smart home and wearable devices, and before that I was a reporter covering consumer tech news. I'm also a yoga instructor, and have been actively teaching group and private classes for nearly a decade. 

Prior to joining PCMag, I was a reporter for SC Magazine, focusing on hackers and computer security. I earned a BS in journalism from West Virginia University, and started my career writing for newspapers in New Jersey, Pennsylvania, and West Virginia.

The Technology I Use

My little Florida beach bungalow is brimming with smart home tech. I have a smart speaker or display in every room, allowing me to control other connected devices by voice. The Nest Hub on my bedside table lets me set wake-up alarms, control my smart light bulbs, and set the temperature on my smart thermostat. I use the Amazon Echo Show 8 on my kitchen counter to browse recipes, reorder protein powder, check the weather, and watch the news while I do dishes. 

Because I suffer from allergies, air purifiers are essential. My favorite model is the Dyson Purifier Cool TP07, which doubles as a fan and continuously sends indoor pollution data to its companion mobile app. 

My pitbull Bradley sheds, so a good robot vacuum is a must. I currently use a premium Ecovacs Deebot that can both vacuum and mop, empty its own dustbin, and wash its own mop cloth. 

For fitness, I like to mix up my routine with cycling, indoor rowing, running, and strength training in addition to yoga. I take classes on the Tonal 2 smart strength training machine, I row indoors on an Aviron machine, and track my beach runs with an Apple Watch while listening to music on my Apple AirPods Pro. On the weekends, I love riding e-bikes like the rugged, beach-friendly Aventon Aventure for fun and fitness.

My job involves a lot of virtual meetings, so a quality webcam, microphone, and ring light are important. I use the Jabra PanaCast 20 webcam, the Elgato Wave: 3 microphone, and a Yesker tripod ring light. 

As for my preferred phone platform, I'm an iPhone person, but I've also extensively used Android for product testing.

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