Mt. Gox’s Inevitable Collapse: Website and Exchange Offline, Alleged Theft

by on February 25, 2014 7:18 am BST

After a series of technical problems that drove Mt. Gox to refuse customer withdrawals, the official site for the once largest bitcoin exchange is down and currently not available. The Tokyo-based exchange’s CEO Mark Larpeles left the board of the Bitcoin Foundation in order to deal with the myriad of problems of Mt. Gox, including flaws in the exchange’s code and potential bitcoin theft. Although, the exchange released a statement, previously, that client’s holdings were not compromised.

The top competing exchanges jointly released a statement to further distant themselves. “This tragic violation of the trust of users of Mt.Gox was the result of one company’s actions and does not reflect the resilience or value of bitcoin and the digital currency industry,” the statement read, issued by Kraken, Bitstamp, Coinbase, BTC China, Blockchain and Circle.

Numerous bitcoin exchanges have seen their share of technological difficulties, and there have been reports of theft from the result of hacking. However, it could have affected Mt. Gox more then the company has led on. In a document circulating the bitcoin community, it is alleged that over 744,000 bitcoins were stolen from Mt. Gox, representing over six percent of the 12.4 million currently in circulation. It is apparent that the Bitcoin Foundation is preparing for the closure of Mt. Gox.

Even if Mt. Gox is able to pick itself back up after the dust clears, it is these such events that leave skeptics saying “I told you so.” Bitcoin has seen a rapid ascent making many million- or billionaires, but its descent has been swifter. Those who wanted to avoid a fiat currency collapse by switching their savings into bitcoins, or just looking to make a trade, could have lost it all through a couple taps on a keyboard made in some dark corner of the world, potentially untraceable.