Bitcoins’ Mt. Gox Lost Half Billion in Hacking, Files Bankruptcy

Bitcoins,
According to the insiders, after the unexpected fall of Mt. Gox, sources reveal that it was not accidental, but that the collapse started more than a year ago. The virtual currency, bitcoins, lost their trustworthiness after the top Japanese exchange company Mt. Gox went bankrupt and lost more than half billion in cyber hacking. The virtual currency intertwined with controllers, separated from their business partners, and confronted various cyber hacking attacks. The protest of hundreds of investors who lost their money was kept in secret by Mark Karpeles, the CEO of the company. The rigorous regulations are crucial in ensuring protection for the financial services. However, the world’s greatest exchange currency, Bitcoin, Mt. Gox now filles bankruptcy. The company said it has lost virtual currency of half a billion dollars because of cyber attacks. Many reports indicate that losing this much all of sudden is not so transparent.

According to the press reports, the company, Bitcoins’ Mt. Gox suddenly lost an estimated 850,000 units of virtual coins and some more 100,000 of their assets. Karpeles explained that faults in their system led to hacking of an estimated $537 million. They recently filed bankruptcy. Additionally, the United States have subpoenaed the Japan exchange company and bitcoin exchange. The subpoena asks for further information on the cyber hacking attacks from the Tokyo exchange company. The investigation will uncover evidence on what led the companies to stop their withdrawals. The speculations surrounding the collapse indicate that Kerpeles’s company went broke serves as a sign that they will not recover from this heavy loss. Meanwhile, the Slovenian exchange company Bitstamp reopened their businesses after confronting hacking.

Furthermore, according to an investor, Nick Shalek, additional entrepreneurs are seeking out to restructure the system of bitcoin, whereas earlier they compromised on the quality which was not so high. The digital currency is similar to the actual form of currency and it is used in the transactions. The net worth of the currency builds over time and bitcoins’ worth was seven billion dollars. The Japanese exchange, in April 2013, reached more than $100 rate and their trading transactions heightened. After that, the US Department of Financial Crimes Enforcement Network told the Tokyo exchange company to comply registration rules and meet standards of trading.

The exchange company giant Bitcoins’ Mt. Gox filed for bankruptcy under the Civil Rehabilitation Law, after they lost more than half billion in cyber hacking attacks. The Japanese court will now appoint a manager to handle the investors who lost their money through the computer hacking. The plans are required to reform the exchange system, and under Chapter 11 of the US Bankruptcy law, the company itself is liable to restructure their system, operations and management. Moreover, according to the Japanese law, the company lacks the ability to carry out their plans; therefore, the court appoints the supervisors. Seemingly, the reports tell that the graphic cards that process the Japanese company’s system is efficient in handling more than a million commands in a second; however the miners’ card can process even higher than eight million commands. It is not easy for the hackers to break the codes, but computer systems can be hacked and that is a relevant fact. The hackers are stealing from similar companies around the world, but Mt. Gox is the biggest of all. Thus, the reports tell that the company wants to file for criminal hacking charges, but currently did not file any. The bitcoins exchange collapsed after losing millions in hacking and this increases further questions and regulations.

By Iqra Amjad

Sources:
Business Spectator
DNA
New York Times
Washington Post
Sydney Morning

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