Nearly a year since the now-defunct Bitcoin exchange Mt. Gox filed for bankruptcy, after losing a total of 850,000 bitcoins in what it claimed was a hack attack, Japan's police has found evidence that around 99 percent of the lost bitcoins disappeared due to internal system manipulation.
According to the Yomiuri Shimbun newspaper, only 7000 bitcoins, or around 1 percent of the total 650,000 missing (the company already discovered 200,000 missing bitcoins in an unused wallet in March last year) were stolen by hackers. Investigators are yet to identify who exactly was responsible for the fraud.
This 'inside job' theory is in stark contrast with the company's long-maintained claim that a vulnerability in the Bitcoin protocol, known as "transaction malleability", was responsible for their losses. Reacting to the report, former Mt. Gox CEO Mark Karpeles said, “There’s not much I can say at this point, except the fact that I will continue investigating in order to find what really happened.”
A couple of months after the exchange filed for bankruptcy, it abandoned plans to rebuild the business and asked the court to allow them to liquidate due to the complexity of holding business meetings with creditors around the world as well as the unrealistic rehabilitation plans set in place.
The 650,000 missing bitcoins were worth around $370 million at the time Mt. Gox collapsed, but are worth nearly $208 million at the current market rates.