Bitcoin On The Ropes As Mt. Gox Files For Bankruptcy

Bitcoin On The Ropes As Mt. Gox Files For Bankruptcy
<a href="">geralt</a> / Pixabay

Mt. Gox, which once handled 80% of the bitcoin trades in the world, announced today that it has filed for bankruptcy protection in Tokyo District Court. The exchange announced that it had lost 750,000 bitcoins owned by customers and 100,000 of its own. That adds up to about $473 million, according to the CoinDesk Bitcoin Index.

Mt. Gox broken by bitcoin

According to MarketWatch, the Japanese exchange’s lawyer said in addition to the value of the lost bitcoins, Mt. Gox had approximately 6.5 billion yen ($63.6 million) in debt but only 3.84 billion in assets. As of this writing, the company had not yet updated its website regarding the bankruptcy filing. The update posted earlier this week remained.

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A number of investors have said they had hundreds of thousands of dollars’ worth of bitcoins in Mt. Gox. MarketWatch reports that a number of “people close to Mt. Gox” said there were more factors than just technical problems which contributed to today’s bankruptcy filing. They also said banks were partially to blame because they took too long to transfer money. Others said government requests played a role in the company’s fate.

Mt. Gox halted withdrawals because of denial of service attacks earlier this month. Investors then began protesting outside the company’s headquarters in Japan, and the company went on to halt all activity. Rumors of a bankruptcy filing began circling, and today’s announcement now confirms those rumors—in spite of the assurance which remains on the company’s website.

Bitcoin still booming in China

Even though Mt. Gox has gone down, the value of bitcoin appears to be remaining rather stable at just under $600, according to CoinBase. Also demand for the crypto-currency remains strong in China, according to MarketWatch contributor Laura He of The Tell blog.

She reports that today bitcoin enthusiasts in Hong Kong hailed the opening of the very first bitcoin retail store. Daily trading volume at Huobi, China’s biggest bitcoin exchange, surged today, climbing to 69% of the total global trading volume in bitcoin. This makes the exchange the new largest one in the world by volume, according to Bitcoinity.


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