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Bitcoin Mt.Gox sends out mixed messages of rebranding and new partners

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The once largest trading platform in the world for Bitcoin, Mt.Gox, has sent an email to Reuters today in response to queries about their status since Mt. Gox left the Bitcoin Foundation yesterday in an official email of resignation.

Reuters has posted the following today: In an emailed response to a question of whether the Tokyo-based exchange was dead, Mark Karpeles, CEO, said: ‘We should have an official announcement ready soon-ish. We are currently at a turning point for the business. I can't tell much more for now as this also involves other parties.’

Mt. Gox has been shut down since Feb.7 when it issued an online announcement that due to technical issues, trading was suspended. Bitcoin trading above $850 immediately fell to lower $700 range in erratic trading.

The reason for the suspended trading led to wild speculation that Mark Kapeles, the CEO of Mt. Gox had stolen the bitcoins and to a calmer explanation from Gavin Andresen, the Bitcoin Foundation’s chief Science executive that Mt. Gox was unprepared technically for transaction malleability, a technical detail that allows changes to the way transactions are identified.

Reuters reports that Mt Gox has posted a message on its site announcing that it is closed. After that announcement appeared on the site the only statement now on the site is: ‘No help desk at support.mtgox.com.’

Reuters also reports that an email was received from Mark Kapeles, CEO, stating in an ‘unofficial’ response that Mt.Gox was at a ‘turning point.’

In an immediate effort to distance them from Mt. Gox, Coindesk and Blockchain.info issued a statement yesterday that can be viewed on Coindesk. The statement lists the reputable exchanges, Coinbase, Kraken, BitStamp, Circle, and BTC China, who are continuing to provide responsible and sound business practices for Bitcoin transactions.

The statement contains names of Bitcoin early investors, such as, Jeremy Allaire, founder of Circle who supports the statement and responsible trading practices.

The Guardian has obtained a ‘leaked document’ called a ‘crisis strategy’ as to the amount of bitcoin in Mt. Gox. If the document is valid by the end of the site’s life, its total bitcoin holdings were just 2,000btc, while customer deposits totaled 624,408btc.

The discrepancy of the bitcoin amount is due to the ability for hackers to attack the amounts held in ‘hot wallets’. The responsible Bitcoin exchanges and traders have updated software since the issue of ‘transaction malleability’ was known as a gap in the Bitcoin software.

The Bitcoin Foundation, the non-profit devoted to development and promotion of the currency, says that ‘any company dealing with Bitcoin transactions [which has] coded their own wallet software should responsibly prepare for this possibility.’

The problem that Mt.Gox faced was that while 70% of all bitcoin transactions went through its site, it was under strict U.S. money –laundering regulations. It was based in Tokyo but it belonged to a U.S. company, Mutum Sigillum LLC. It was hard to sell bitcoins and convert to dollars. Transactions took longer to clear but one could transfer a btc to another currency and it would be held.

In early February when the company discovered that its cold storage was gone. The Guardian reports that the crisis strategy document says the company is insolvent, with $55m of liabilities but assets of just $32m ($5m of which are held by the US Department of Homeland Security after they were seized in August 2013.)

To find other articles related to Bitcoin, peer-to-peer currency, and other related news reviews see the list below in Author’s suggestions and view the video atop this article on Mt.Gox status.

You find me on twitter at Victoria Wagner@Victoriaross888

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