Top Trending Cryptocurrency News of the Week: Coinbase and Mt. Gox Among Major Newsmakers

Key highlights

Ex-Mt Gox Head Will Serve No More In Jail
Hong Kong’s Gatecoin exchange shuts down
Central Bank of Russia Plans on Limiting Cryptocurrency Trading
Basel Committee Issues Warning to Banks for Cryptocurrency Risks
Coinbase Custody Unveils New Cold Storage Cryptocurrency Trades

Ex-Mt Gox Head Will Serve No More In Jail
Well, another turn in the Mt Gox exchange hack case. A court in Tokyo has handed Mark Karpelès, the former chief executive of the collapsed Bitcoin exchange Mt. Gox, A 2.5 years of the prison sentence on Friday. This means Mark Karpelès will not be serving any additional time in the jail if he remains on good behavior. This verdict bought an end to more than a 5-year ordeal for Mr. Karpelès who was charged for falsifying data
Hong Kong’s Gatecoin exchange shuts down
Gatecoin, the Hong Kong-based cryptocurrency, has finally announced that it will be calling curtains to its operations after a court order and the bank account freeze. Last week, the court had granted a winding-up order against the company. Gatecoin stated that it will assist in the liquidation process in order to expedite the realization of its assets to the creditors.
Central Bank of Russia Plans on Limiting Cryptocurrency Trading
Apart from standing by innovation, the blockchain, and cryptocurrency, the Russian regulators especially the country’s central bank has planned to put a yearly limit on so-called “unqualified investors” who are willing and able to buy cryptocurrencies as reported by the media house RBC’s. The central bank also plans to change the existing draft digital currency bill, known as ‘On Digital Financial Assets,’ that passed the second reading in parliament – State Duma.
Basel Committee Issues Warning to Banks for Cryptocurrency Risks
Another news coming from the world banking authority, the Basel committee, which after citing the growth of cryptocurrencies as a risk to banks, has issued a warning to banks around the globe. Having released a statement this week, The Basel committee which is the part of Bank for International Settlement (BIS), released a statement stating that, the important risks the banks will be facing which were listed by a Swizz based think tank includes credit and market risks, money laundering risk, liquidity risk, terrorist financing risk, operational risk, and legal and reputational risks.
Coinbase Custody Unveils New Cold Storage Cryptocurrency Trades
Coinbase is back in news and this time for its Coinbase Custody service. According to the latest announcement, Coinbase Custody service is now directly integrated with the company’s newly launched OTC desk. Custody clients will be able to complete trades directly from cold storage, the company said in its release, adding that it was a service many of its users requested.
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Source: CoinGape

Mark Karpeles is responsible for failing to protect funds, says Bitcoin Cash’s Roger Ver

Roger Ver, the CEO of Bitcoin.com and a well-known Bitcoin Cash proponent, recently spoke about Mark Karpeles. Karpeles, the former CEO of Mt. Gox – the infamous Bitcoin exchange, made headlines this week after he received a suspended sentence from the Tokyo District Court.
Karpeles was found guilty of altering numbers in the firm’s financial records and was acquitted of all other charges, including embezzlement of funds. The verdict came as a relief for the CEO as he would have faced up to ten years in prison if the alleged embezzlement charges had been proven. He was charged with the embezzlement of around $3 million in customer funds.
The Tokyo District Court ruled that “he had acted without ill intent,” reported Bloomberg. Additionally, he was given a two-and-a-half year suspended sentence, which he will have to serve if he committed another crime within the next four years.
The court also stated,
“The charge of electronic record tampering is true and deserves punishment, but there’s no criminal evidence of embezzlement […] there is no excuse for the defendant, who is an engineer with expert knowledge, to abuse his status and authority to perform clever criminal acts.”
Roger Ver, in an interview with Decrypt, stated that Karpeles was “responsible for not doing a good job protecting the funds from the hackers”. Nevertheless, the Bitcoin Cash proponent also clarified that he held the hackers responsible for stealing the funds.
Mt. Gox was once the biggest Bitcoin exchange platform in the world, controlling over 70% of all BTC transactions. However, the exchange fell victim to a hack, and subsequently lost control of over 7% of all Bitcoins in circulation. This resulted in the platform shutting down its operations and declaring bankruptcy.
Presently, Mt. Gox is undergoing a civil rehabilitation program under which victims of the platform will be repaid their losses with the Bitcoins that were discovered by Karpeles in cold wallets. Ver is noted to be one of these victims, holding “life-changing amounts of Bitcoins” on the exchange, reported Decrypt.
Further, with respect to Karpeles’s suspended prison sentence, Ver said that it was only for “those who are physically dangerous towards others”. He also suggested that people should be punished after they were convicted, not before, in light of Karpeles being interrogated for 50 days in a row.
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Source: AMB Crypto

Mt. Gox’s Mark Karpeles Found Guilty Producing Illegal Records, Gets Suspended Term

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Mt. Gox’s Mark Karpeles Found Guilty Producing Illegal Records, Gets Suspended Term
Mark Karpeles, who presided over the dramatic 2014 collapse of the world’s biggest cryptocurrency exchange Mt. Gox, was found guilty of tampering with financial records but will likely avoid jail time after receiving a suspended sentence.
Mt. Gox’s Mark Karpeles Found Guilty Producing Illegal Records, Gets Suspended Term

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Source: CoinSpeaker

Mt. Gox: Tokyo Court acquits Mark Karpeles on embezzlement charges; finds him guilty of electronic data tampering

Mark Karpeles, owner and CEO of the now-defunct Bitcoin exchange, Mt. Gox, has been convicted of falsifying electronic data, but was acquitted of embezzlement charges by Tokyo District Court on 15 March.
The French businessman was found guilty on charges of record tampering, and was subsequently granted a suspended jail sentence for two and a half years. This means that Karpeles wouldn’t have to serve time in prison if he does not commit any crime for a period of four years. Additionally, the court also ordered Mark Karpeles to compensate for trial costs.
Yuji Nakamura, a Bloomberg tech reporter, summarized the Tokyo District Court’s verdict on Karpeles,
“In summary, the court found that the way he ran Mt. Gox was a total mess and that he tampered with records to hide the fact it was missing a lot of Bitcoin, but he did not do it for personal gain or have ill intent.”
According to his translations, the court stated that the use of tampered data involving a large sum of funds caused severe damage to the customers of Mt. Gox. However, there was no criminal evidence of the serious allegations Karpeles was charged with. He also stated that the defendant’s criminal responsibility cannot be undermined.
Tokyo prosecutors had previously accused Karpeles on multiple accounts of fraud, including embezzlement and aggravated breach of trust, demanding a 10-year prison term for him. Maintaining his innocence since the very beginning, the CEO of the infamous exchange said that he was happy to be found not guilty of the serious charges of embezzlement and breach of trust.
The Mt. Gox fiasco accounted for a loss of 850k BTC, out of which only 200k coins have been recovered. The breach resulted in a loss of over 7% of the entire Bitcoin circulation in early 2014. Later, the company filed for bankruptcy and ceased its operations.
The post Mt. Gox: Tokyo Court acquits Mark Karpeles on embezzlement charges; finds him guilty of electronic data tampering appeared first on AMBCrypto.
Source: AMB Crypto

Mt. Gox Case Verdict: CEO Karpeles Will Not Serve Jail Time

Mt. Gox CEO, Mark Karpeles was found ‘not guilty’ of the fund embezzlement charges imposed on him. However, he was found guilty of submitting falsified records to the Japanese District Court.
The Tokyo District Court has passed a 2-year 6-month sentence suspended for 4 years. Hence, Karpeles has been laid off with a warning and a probation period of four years. If he repeats his felony or is found guilty in the future again he would have to serve 2.5 years in prison after the judge’s discretion.
Proceedings of the Case And Final Statements
Karpeles’ chief lawyer Nobuyasu Ogata has had to clear the doubts around cryptocurrencies and Bitcoin in order to make Karpeles’ stand. He argued that Karpeles was actually ‘the victim’ of the Mt. Gox heist in February 2014.
The Japanese District Court has acquitted Karpeles of ‘more serious crimes’ that he was allegedly accused of: Fund Embezzlement and Fraud. It was noted that Karpeles was humble and listened to the verdict humbly.
Acquittals are rare in Japanese courts, where the conviction rate is higher than 99 percent. Karpeles also noted that, he was interrogated for months without a lawyer and bullied into signing a confession, a “nightmare” process during which he lost 77 pounds over 11 months.
Karpeles swore that he never utilized any customer fund and Mt. Gox was a security breach, for which he is deeply apologetic.
The post Mt. Gox Case Verdict: CEO Karpeles Will Not Serve Jail Time appeared first on Coingape.
Source: CoinGape

6500000 Bitcoins Lost Forever, Mt. Gox Owner to Meet His Fate in Court on Friday March 15

The infamous Mt. Gox saga will finally meet an end in the Japanese Courts on 15th March 2019. The owner of the exchange, French Mark Kerpeles, 33, is accused of ‘faking digital data and embezzling millions of dollars ($3 million).’; If found guilty he will be heavily penalized and might serve a sentence of ten years. Here is a small recap of the entire episode:
2014 Mt. Gox Shutdown
In February 2014 Mt. Gox had stopped withdrawals and trading on its exchange reportedly due to maintenance issues. However, on 28th February 2014, it filed for bankruptcy claiming that the most significant exchange of the world at the time had been hacked of 850000 Bitcoins.
The Bitcoin market soon plummeted, and investors lost around $425 million worth of Bitcoins at the time. The case was brought to light at the Japanese Court, and Mark Karpeles, the owner of the exchange, was held accountable.
In March 2014, a public release on the website announced that they had recovered 200000 Bitcoin from the cold storage wallets of Mt. Gox Exchange. The funds were held in ‘trust’ by the Japanese Authorities for credit protection.
2015 Case Proceedings: 650000 Bitcoins Lost Forever?
After the revelation of the 200,000 Bitcoins, the investigation reached a dead-end due to lack of KYC and ALM compliances at the time.
Mark Karlepes was later arrested in Japan in August 2015. Kerpeles is alleged to have manipulated the exchange data for years during the running of the exchange embezzling almost $3 million. He served one year of imprisonment until July 2016 when before he was released on bail.
This is a very small amount with respect to the value of 6500000 Bitcoins still reported missing at the exchange. Nevertheless, if found guilty, he would be penalized heavily.
Satoshi Mihira, chief attorney at Mizuho Chuo law firm, said: “If it was an outside hacker who stole the currency, it’s a problem. But if he stole even part of the money, it would be embezzlement.”
How Much Did The Investors Actually Lose?
The proceedings against Mark Karpeles could add some funds to total credit amount, however, the illicit owner of 6500000 Bitcoins from Mt. Gox still looms at large.
Nevertheless, all is not lost for its investors. In June 2018, when the price of Bitcoin was $6200, the Tokyo District Court had initiated a credit reimbursement program known as civil rehabilitation. Funds to the tune of 170,000 each of Bitcoins and its hard fork Bitcoin Cash, worth roughly $1.2 billion were credited back its ex-customers and debtors. The amount is still almost three times the amount that was reportedly lost during the heist.

“Enormous assets…will be returned to creditors of Mt. Gox,” Shin Fukuoka, a leading attorney, and partner at Japan’s Nishimura & Asahi law firm, he also wrote in a statement. “This is the creditors’ victory.”

First creditors meeting since Civil Rehabilitation completed today for #MtGox – next one will be on March 20th 2019. Remember, deadline for filing Civil Rehabilitation claims is on October 22nd 2018, so if you have a claim against MtGox, remember to file on time!
— Mark Karpelès (@MagicalTux) September 26, 2018

Prosecutors’ Claims Against Kerpeles
The prosecutors against have filled for a 10-year sentence and reimbursements to creditors from his personal assets. According to the prosecutor, they have reports of extravagant spending and investments by Mark Karpeles which might indicate that the funds were ill-founded.
They have found considerable investment in a 3D-printing software business that had nothing to do with the exchange. Furthermore, a $54,000 worth canopy bed, thousands of dollars on overseas trips for his distanced wife,  and spent thousands of dollars on living a luxurious life (reportedly $120,000 annually).
Karpeles’ Defence
The owner of the disputed exchange has been active on social media ever since his release. Although he has been accused of fraud, and the investors and ‘Twitterati’ have bad mouthed Karpeles; He continues to maintain a non-guilty stand.
“Most people will not believe what I say. The only solution I have is to actually find the real culprits,” he told reporters after the hearing.”
 

When you lose an argument, what better way to score a win than to attack the person themselves rather than the argument. There’s a word for that thankfully: argumentum ad hominem. Look it up.https://t.co/jA1Zp4Atrh
— Mark Karpelès (@MagicalTux) February 10, 2019

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Source: CoinGape

Bitcoin Jesus: Don’t Delete Coinbase, No Other Firm Does More for Crypto

Roger Ver is among the most polarizing characters in the crypto industry. He often goes against the grain, even if it earns him notoriety. Such is the case with recent comments made by Ver, defending San Francisco-based Coinbase in the face of the ongoing #DeleteCoinbase boycott.
Few people have done more to further the adoption of Bitcoin and cryptocurrencies than Ver, so while his defense of Coinbase carries much weight, he’s been wrong in the past in his support of cryptocurrency exchanges and it’s cost crypto investors dearly.
Roger Ver: Coinbase Pushes Crypto Adoption, Don’t Support #DeleteCoinbase
This past week, a scandal at Coinbase over the recent acquisition of Neutrino has led to an angry mob situation in the cryptocurrency world. As part of the acquisition, Coinbase absorbed employees from Neutrino that were tied to a controversial software company called Hacking Team, that was responsible for providing governments, law enforcement agencies, and dictator regimes with tools to surveil individuals.
The Hacking Team’s work goes against much of the values cryptocurrencies were built upon, such as privacy, and removing the control governments have over individuals, which called Coinbase’s integrity and commitment to the space into question. The community’s distaste and unrest quickly turned into taking action, launching a ferocious social media campaign dubbed #DeleteCoinbase, where crypto investors are encouraged to ditch Coinbase for other alternatives across the market.
Related Reading | Why Did Major Crypto Exchange Coinbase Suddenly Add XRP?
However, Bitcoin.com CEO Roger Ver has come to the defense of Coinbase, suggesting that few other companies can claim to have done as much to push crypto adoption forward as the San Francisco-based crypto giant.

Coinbase has done more to drive crypto currency adoption than just about any other company. We should be grateful despite a few poor decisions along the way. Don’t #DeleteCoinbase
— Roger Ver (@rogerkver) March 7, 2019

Ver, as an investor, has done more to promote cryptocurrency adoption than any other individual. It’s earned himself the nickname Bitcoin Jesus due to his early evangelism in the space. His defense of Coinbase is likely to hold a lot of weight, however, Ver has been wrong about defending crypto exchanges in the past.
Roger Ver Famously Claimed Mt. Gox Was Solvent, Is His Defense of Coinbase an Omen?
While Ver’s support of Coinbase makes sense, his defense of a now infamous cryptocurrency exchange caused a lot of investors much loss and grief.
Ver is quoted as claiming the now defunct crypto exchange Mt. Gox, which was among the first exchanges to bring Bitcoin to the masses, was solvent prior to the exchange’s eventual collapse only months after the comments were made.
Related Reading | Roger Ver’s Bitcoin.com is Reportedly Under Government-Sponsored Attack
Months before it was revealed that Mt. Gox had lost 850,000 BTC of its customer’s funds, Ver filmed a video defending the exchange. Ultimately, Mt. Gox went bankrupt and the case has since moved to civil rehabilitation in hopes of returning some of the lost funds to early Bitcoin investors.
Ver and his high school friend Jesse Powell, who is also co-founder of crypto exchange Kraken, had gotten involved with Mt. Gox in 2011 during the Bitcoin bear market. Calling Ver’s defense of Coinbase further into question, is his long-time friend’s negative comments about Coinbase.

While Powell and Kraken are in direct competition with Coinbase, and are likely using the moment of weakness to capitalize, there’s no denying that there’s validity in Coinbase appearing to be actively destroying the brand equity they’ve worked so hard to build. 
Featured Image from Shutterstock
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Winklevoss’s Twin Conviction Towards Bitcoin Becomes Stronger Than Ever

Billionaire Bitcoin Investors and founders of Gemini Trust, Tyler and Cameron Winklevoss, recently addressed the on-going issues related to ‘protection of cryptocurrency wallets’ and ‘delayed regulations.’
‘Carcasses on the road of Crypto’
The security, feasibility of access and regulatory approval around an asset class, determines the FUD (Fear, Uncertainty, and doubt) characteristics around the pattern. Bitcoin was conceived to address the problem of centralized banking which holds controls over the funds of their customers.
However, ever since the Mt. Gox hacks in2011, it became apparent that the exchange which holds the private key for their customers are no different than the banks which act as custodians of their user’s funds. Recently, eight years after the hack, and numerous frauds and Ponzi schemes the demons of centralized exchange have come to surface with the QuadrigaCX issue.
The sudden death of the CEO of the Canadian Exchange, who was the sole holder of the private keys of the exchange’s cold wallet has unfortunately locked the funds of thousands of users. The total amount of the funds secured in cold wallets is approx $190 million.
“There are a lot of carcasses on the road of crypto that we’ve seen and learned from,” Cameron Winklevoss said Friday at the South by Southwest conference in Austin, Texas. “At the end of the day it’s really a trust problem. You need some kind of regulation to promote positive outcomes.”

“With a #crypto address and a smartphone, all of a sudden you are in the system. We are really just trying to extend the financial system, so you can send dollars anywhere in the world.” Our President Cameron @winklevoss on reaching the 1 billion people who unbanked #SXSW2019 https://t.co/VZk9fxwayQ
— Gemini (@Gemini) March 9, 2019

Not Deterred from their Original Goal 
Winklevoss Twins support cryptocurrency and eventually found the Gemini Trust to provide an efficient payment system to the 1 billion ‘non-banked’ people of the world.
“With a crypto address and a smartphone, all of a sudden you are in the system,” he said. “We are really just trying to extend the financial system, so you can send dollars anywhere in the world.”
However, the systems around the blockchain and cryptocurrencies which are the end providers of access to Blockchain including Bitcoin must be diligently designed to address unforeseen circumstances as well. The community has suggested that multi-signature wallets and personalized education around public and private keys is the best way to go.
The twins also reaffirmed their conviction towards the revolutionary economic system,
“You want to have a couple of layers of checks and balances,” Tyler Winklevoss said. “We are here for the long haul.”
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Source: CoinGape

Mt. Gox: Exchange’s key challenge was getting fiat, says Stellar’s Jed McCaleb

Mt. Gox, a Bitcoin exchange platform, continues to linger in the minds of several investors and traders. This is mainly because of the exchange’s part in Bitcoin’s adoption and the hack that led to its doom.
Originally, it went by the name, ‘Magic: The Online Gathering Exchange,’ a platform for trading ‘Magic: The Gathering’ cards. This platform was soon re-modified in order to enable the trade of Bitcoin, the largest cryptocurrency by market cap and also the very first coin in the space. Soon after this, the exchange rose to popularity as it enabled Bitcoin to US Dollar trade.
Moreover, Bitcoin also witnessed one of its major bull runs under the aegis of Mt. Gox. However, Bitcoin’s fall was also under the aegis of the exchange platform. In the year of 2014, the exchange platform lost over 7% of the total Bitcoins in circulation due to a hack.
750,000 of the stolen BTCs were owned by customers of the platform while 100,000 BTCs were owned by the exchange platform. The total worth of the hack at that point in time was approximately around $475 million, making it the biggest ever hack to take place in the cryptocurrency space.
Currently, the exchange platform is undergoing a rehabilitation program, in an attempt to give Bitcoins back to their creditors. Apart from this, Brock Pierce, a former director of Bitcoin Foundation, and a venture capitalist, has begun a project pertaining to Mt. Gox, known as Gox Rising, claiming that his firm has acquired all the rights of Mt. Gox from Mark Karpeles. However, Karpeles has shot down these claims on his Twitter handle.
Recently, Jed McCaleb, the co-founder of Ripple and the CTO of Stellar, spoke about the infamous exchange platform, in an interview with WhatBitcoinDid. Apart from being a part of these leading cryptocurrency projects, McCaleb was also a key contributor to the rise of Mt. Gox and the platform was one of Jed McCaleb’s early projects in the cryptocurrency space.
During the interview, McCaleb elucidated on the key-challenges faced by the exchange in its early days. He said,
“One main like challenge with exchanges then and still today is just getting fiat, you know, on and off the exchange. Like, that’s kind of like, the roadblock for like how successful you can be and like how much money people can put through there, it’s just all like how much fiat you can deposit and withdraw.”
He further said,
“Like, that’s by far the main challenge and and that’s not a very fun one because you’re you’re dealing with like APIs of banks that are like old and crappy and like and you know or just like random like integrations to different payment networks and something that is just not very fun work”
This was followed with McCaleb speaking about the solution the platform came up with in order to tackle the problem. He said,
“We used PayPal Liberty Reserve I can I think there’s another one I think we would take bank wires yeah I think those are the three ways”
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Source: AMB Crypto

Brock Pierce Set to Make Mt. Gox Great Again, and Here’s How

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Brock Pierce Set to Make Mt. Gox Great Again, and Here’s How

Brock Pierce wants Mt. Gox creditors to receive 100 percent of whatever they’re owed. He’s also fought with former Mt Gox CEO and majority shareholder Mark Karpelès on Twitter about the feasibility of his plan and whether it’s even legal.

Brock Pierce Set to Make Mt. Gox Great Again, and Here’s How

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Source: CoinSpeaker

MtGox Currently Controls Bigger Bitcoin Market share than the Gold Reserves of the Swiss Central Bank

Bitcoin has been characterized as the digital gold that according to some bitcoin proponents is better at being gold than gold itself. Bitcoin is also predicted to surpass the $8 trillion market cap of gold and emerge as the store of value.
Now, Tuur Demeester, the Founding partner at Adamant Capital, has calculated the Bitcoin circulating supply in equivalence of Central banks’ gold reserves and shared the following data.

“The current value of Dutch Central Bank gold is about $25 billion, so in order to buy 69k BTC (the mined Bitcoin equivalent of the Dutch gold reserve) it would only need to sell 1% of its gold, i.e. 492 gold bars,” shared Demeester.
He further did a comparison of the Bitcoin still left with Mt Gox with that of the central banks’ gold reserves.
“Allows for fun comparisons, e.g.: The MtGox Trustee currently controls 137,891 BTC, which is bigger in terms of market share than the gold reserves of the Swiss central bank.”
Currently, a group of Mt. Gox creditors has banded together to create a movement called “GoxRising” with the goal of reviving the exchange and present a detailed Civil Rehabilitation plan.
The movement has been proposed by Brock Pierce who reportedly bought 12 percent stake owned by Jed McCaleb, founder of Mt. Gox for 1 BTC. “We have the rise, the fall, and it’s been in liquidation and bankruptcy in Japan for over five years. But the story is not over,” Pierce had been quoted as saying,
“Like Game of Thrones, the last season of Mt. Gox hasn’t been written. What kind of ending do we want to make for it? I’m a Joseph Campbell fan, so I’m obviously going to go with a hero’s journey, with a rise and a fall, and then a rise from the ashes like a phoenix…”
Reportedly, Pierce has no interest in the past gains of Mt. Gox but wants a happy ending of this story. Pierce also wish to start a new chapter by relaunching Mt. Gox. He further plans to offer its 20,000 creditors a stake in the future of the company.
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Source: CoinGape

Famous VC Brock Pierce Unveils His Unbelievable Plan to Remedy Notorious Mt. Gox Theft

CoinSpeaker

Famous VC Brock Pierce Unveils His Unbelievable Plan to Remedy Notorious Mt. Gox Theft

Pierce charts the new plans of repaying the Mt. Gox victims through the creation of a new company under the same brand and its native cryptocurrency Gox Coin.

Famous VC Brock Pierce Unveils His Unbelievable Plan to Remedy Notorious Mt. Gox Theft

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Source: CoinSpeaker

Bitcoin Rich Mt. Gox Trustee May Have Crashed Crypto In Early-2018

Theories have flown around regarding what catalyzed the crypto sell-off seen in 2018. While proposed triggers include stringent regulation, the lack of publicly-tradable Bitcoin (BTC) exchange-traded funds brought to market, or a simple case of waning interest from the common Joes & Jills of the world, a new hypothesis has just hit the mainstream.
Related Reading: Crypto Exchange Volumes Drop to Lowest Levels For Over a Year
The Mt.Gox Bitcoin ‘Dumpening”
Nobuaki Kobayashi, the trustee of now-disgraced Bitcoin exchange Mt. Gox, has purportedly gone AWOL. Per damning evidence released by GoxDox, a publication dedicated to supporting the victims of the ~$470 million Mt. Gox imbroglio, the five-year debacle of the Japan-based exchange, which was hacked for hundreds of thousands of BTC, has unfortunately continued.
In GoxDox’s first post following a multi-year hiatus, the authors released an array of supposedly official bank statements that pertained to Kobayashi and BitPoint, a crypto upstart centered around the Japanese market. The bank statements, of which there were more than ten, purportedly outlined a handful of fiat transactions made from late-February 2018 to early-June. The transactions from BitPoint pushed the trustee’s bank balance up by ¥34.346 billion ($310 million U.S.).

While none of the documents, obtained from an anonymous source, mentioned the sale of cryptocurrency, it assumed that the Mt. Gox trustee saw the colossal influx of funds after liquidating thousands, if not tens of thousands of BTC at spot prices. GoxDox, named in an evident jab at exposing a shadowed, yet well-known event in crypto’s history (so far), quipped:

“Unless BitPoint is being really generous, we’d wager the reason they are depositing billions [of] JPY into the trustee’s bank account is because they were hired to sell the MtGox Estate’s BTC/BCH.”

The investigators, who began their efforts after the Mt. Gox hack shocked the globe, went on to touch on the irregularity and spontaneity of BitPoint’s dozens of deposits into the account of Kobayashi. GoxDox remarked that the trustee himself was wary of a second Mt. Gox, thus mandating BitPoint to send the fiat it garnered from selling Bitcoin at market immediately, even if it meant issuing deposits each and every day. And as such, it was concluded that much of Kobayashi’s holdings were released to the wind in May, not earlier as other reports suggest.
Yet, NewsBTC does see some parallels between the price action seen in late-February and the sale of BTC (a.k.a. the deposit of Japanese Yen into Kobayashi’s account). While this could just be an untimely coincidence, from February 20th to February 26th, BTC fell from $11,900 to $9,500 — somewhat lining up with the dates indicated in the GoxDox paper. The same could be said with the May sell-off, with BTC losing 20% during the presumed period of liquidation.
Again, this tumult could have just been a byproduct of the unraveling of 2017’s parabolic run-up. Yet, even the anonymous authors behind the study seem convinced that BitPoint’s involvement in this whole situation changed the underlying market conditions when they concluded:

“An auction of the MtGox Estate’s BTC/BCH would have resulted in less damage to the value of its remaining assets, not to mention the entire crypto market.  It’s a shame the trustee and BitPoint didn’t see that.”

Kraken CEO Bares Fangs
Case closed? No, far from. According to GoxDox, if Kobayashi actually did employ the aforementioned Japanese exchange to liquidate much of his holdings, he went directly against the advice offered by Jesse Powell, the chief executive of Kraken, about this fiasco.
According to a comment made on Reddit, Powell overtly told the Mt. Gox estate that it shouldn’t sell its coins. If Kobayashi was to go ahead with securing fiat for the cryptocurrency, Powell explained that his company could either facilitate a formal auction or make a transaction via an over-the-counter (OTC) platform. The American Bitcoin pundit supposedly added that he and his team made it clear that Mt. Gox shouldn’t dump a large amount of BTC en-masse and on spot exchanges.

Powell’s comments don’t seem to be fabricated either, as the San Francisco-based technology entrepreneur took to Twitter on Tuesday to weigh in. The Kraken CEO, who seems to agree with the analysis that the liquidation played a noticeable role on the broader cryptocurrency market, expressed his disbelief that Mt. Gox didn’t enlist the use of a public auction or OTC sale.
Hinting that insiders may have profited off of BitPoint and Kobayashi’s decision to sell much of the cryptocurrency owned by Mt. Gox estate, he remarked that exchanges will need to “launch investigations into who took out massive shorts ahead of this dumping.”
Powell wasn’t the only industry commentator to erupt into a clamor after this exposé spread like wildfire. David Gerard, a blockchain-centric author that recently had a field day with the QuadrigaCX situation, noted that this situation exemplifies the lack of liquidity in this market.

Upset investor analyses Mt. Gox BTC bankruptcy sale data. Thinks he's demonstrated incompetent dumping by the trustee – actually shows that an 18m BTC "market cap" can be crashed by selling 60k BTC, over months, at market prices => there is no market https://t.co/eULoggRrx2
— David Gerard (@davidgerard) February 5, 2019

Others questioned Kobayashi’s intentions, asking if he meant ill on the nascent crypto market. I am Nomad even pointed out that BitPoint apparently has an OTC desk, likely questioning why the Mt. Gox estate didn’t go ahead with using that medium of exchange.
As Kobayashi didn’t technically do anything illegal, the release of this information likely isn’t going to materially change the Mt. Gox case. And as such, the creditor repayment plan is likely still in play.
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Mt.Gox Trustee Sold $318 Million Cryptos on Japanese Exchange – GoxDox Report

Although Mt.Gox is bankrupt since last four years, the controversies and talks on it didn’t finish yet. Recently leaked data reports that bankrupted Japanese bitcoin exchange, MtGox, reportedly sold $312 million cryptocurrencies through Japan’s BitPoint exchange, BitPoint.
Massive Amount of Crypto Sold on Japanese Exchange
It was revealed on a website ‘goxdox.com’ by an unidentified party shares the screenshot of ‘transaction data’ captured from BitPoint exchange. The data on goxdox.com (Mt.Gox’s creditor campaign group) allegedly points out that Nobuaki Kobayashi, Mt. Gox trustee sold million dollars worth cryptocurrencies to repay to creditors.
Specifically, the bank book of trustee shows 34.3 billion yen was withdrawn which reportedly sourced to the ongoing legal proceedings of bankrupt exchange at the Tokyo District Court.
GoxDox mentioned that;
“Unless BitPoint is being really generous, we’d wager the reason they are depositing billions JPY into the trustee’s bank account is that they were hired to sell the MtGox Estate’s BTC/BCH,”
Notably, 60000 BTC and BCH crypto tokens were sold on open trading platform of Japan. Beside Bitpoint exchange, GoxDox also notes the response of Jesse Powell, CEO of Kraken Exchange. Prior to BitPoint, trustee approached Jesse Powell on a similar matter to sell a huge number of crypto tokens on Kraken. As a response, Powell advised to do it an auction or OTC (over the counter ) sale to avoid the risk of affecting market price. In a similar context, Goxdox writes;
“Instead of taking Kraken’s advice, the trustee decided to (1) sell, (2) not tell us how he sold, and (3) hire a different so-called “cryptocurrency expert” to sell the BTC/BCH,”
The post Mt.Gox Trustee Sold $318 Million Cryptos on Japanese Exchange – GoxDox Report appeared first on Coingape.
Source: CoinGape

Major Exchanges Fail to Prove Their Readiness for ‘Proof of Keys’ Movement

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Major Exchanges Fail to Prove Their Readiness for ‘Proof of Keys’ Movement

In addition to being Bitcoin’s 10th birthday, Jan. 3, 2019 will go down in history as being the crypto world’s inaugural Proof of Keys day.

Major Exchanges Fail to Prove Their Readiness for ‘Proof of Keys’ Movement

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Source: CoinSpeaker