Talk about high profile cryptocurrency hacks in the industry; then the 2014 Mt Gox bitcoin exchange hack would top the list.
Before the Mt Gox Hack
The Japanese exchange, launched in 2010, was known as the world’s biggest and most prolific bitcoin exchange by trade volume. The exchange at that time was handling about 70% of total bitcoin transactions in the world.
Fun fact: Mt Gox is an acronym for Magic: The Gathering Online Exchange.
The exchange was attacked in 2011, and the hacker(s) reportedly stole 2609 bitcoins to an unknown wallet. This forced the company to suspend its operation for some days. Luckily, they somehow remained in the bitcoin market, retaining the trust of customers.
Operations resumed fully, and things started going down well with the company. Everyone was happy, including the French CEO, Mark Karpeles. He even planned on launching a Bitcoin Café and many other exciting projects.
However, Mark’s dreams and happiness were short-lived as Mt Gox reportedly went bankrupt after hackers hit the company a second time in 2014. The company allegedly lost about 744,000 bitcoins from the exchange, making it the biggest crypto hack of all time.
Were Investors refunded?
Unfortunately, investors and traders did not receive any compensation, at least not yet. However, Coinfomania earlier reported that the case is still ongoing, and corporate investors are likely to get back their lost funds after the court ordered the exchange to make refunds.
Affected users were told to log in to their Mt Gox account and verify their identity and other information to receive their refunds, which will commence next year.
But Was Mt Gox Really Hacked?
According to recent reports, affected Japanese investors are seeking a 10-year sentence Mark Karpeles, the CEO of Mt Gox, for embezzling the company’s fund for “personal interests,” and data manipulation.
The prosecutors claimed that Mark, 33, diverted 341 million yen ($3 million) of investors funds as a “software development business,” which was one of the reasons for the failure of the once-famous-exchange.
The accused denied the allegations of both embezzlement and data manipulation in the first trail in 2017. “I swear to God I am not guilty,” he read from a written statement.
However, in April 2018, the CEO apologized for the current state of things, and that he does not want whatever would be left after all victims of the hack have been duly compensated.
Mt Gox made an official publication in early 2014 that the exchange has been hacked and about 850,000 BTCs were stolen but was able to recover some of the funds.
Whether it was indeed a hack or embezzlement by the CEO, getting back the lost funds would leave smiles on the faces of the victims.