The MtGox Bitcoin Exchange Has Filed For Bankruptcy Protection

Major Bitcoin exchange Mt.Gox, has lost nearly all the virtual currency held in its systems and has filed for bankruptcy protection at a Tokyo district court.


The application was made in Japan by lawyers acting on behalf of the exchange and comes only days after MtGox went offline. A lawyer for the embattled Japan-based company announced at a news conference at the court that the exchange was filing for Chapter 11-style protection.

On Tuesday, the exchange's boss said he was working hard to find a "solution to our recent issues".

Before going offline, technical troubles meant it prevented customers transferring digital cash to other exchanges on 7 February.

Details of the bankruptcy are scant but the application for protection has been accepted by a district court in Tokyo.

MtGox's lawyers are believed to have decided to apply to the court for protection after US regulators filed a subpoena against the company.

Reports suggested the site shut down after it discovered that an estimated 744,000 bitcoins - about $350m (£210m) - had been stolen due to a loophole in its security.

MtGox's troubles have put pressure on the price bitcoin owners can get for their holdings. Currently one bitcoin is worth about $561 (£334), a price far lower than the high of $1,000 per coin it hit in November 2013.

At the same time, Japan's deputy finance minister said any regulation of bitcoin would have to involve international cooperation to avoid opening up loopholes that traders could exploit.