Mt. Gox
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| Type | Bitcoin exchange |
|---|---|
| Location | Shibuya, Tokyo, Japan |
| Founded | 2010 |
| Owner | Tibanne Ltd. |
| Currency | Bitcoin |
| Website | MtGox |
Mt. Gox was a bitcoin exchange based in Tokyo, Japan. It was launched in July 2010, and by 2013 was handling 70% of all bitcoin transactions. In February 2014, the Mt. Gox company suspended trading, closed its website and exchange service, and filed for a form of bankruptcy protection from creditors called minji saisei, or civil rehabilitation, to allow courts to seek a buyer. In April 2014, the company began liquidation proceedings. It announced that around 850,000 bitcoins belonging to customers and the company were missing and likely stolen, an amount valued at more than $450 million at the time. Although 200,000 bitcoins have since been "found", the reason(s) for the disappearance—theft, fraud, mismanagement, or a combination of these—were initially unclear. New evidence presented in April 2015 by WizSec led them to conclude that "most or all of the missing bitcoins were stolen straight out of the MtGox hot wallet over time, beginning in late 2011."
In late 2006, programmer Jed McCaleb (eDonkey2000, Overnet1, , Stellar) thought of building a website for users of the Magic: The Gathering Online service to let them trade cards like stocks. In January 2007, he purchased the domain name mtgox.com, short for "Magic: The Gathering Online eXchange". Initially in beta release, sometime around late 2007, the service went live for around 3 months before McCaleb moved on to other projects, having decided it was not worth his time. He reused the domain name in 2009 to advertise his card game The Far Wilds.
In July 2010, McCaleb read about bitcoin on Slashdot and decided that the bitcoin community needed an exchange for trading bitcoin and regular currencies. After writing an exchange website, he launched it while reusing the spare mtgox.com domain name.
He sold the site to Mark Karpeles in March 2011, saying "to really make mtgox what it has the potential to be would require more time than I have right now. So I’ve decided to pass the torch to someone better able to take the site to the next level."
On 19 June 2011, a security breach of the Mt. Gox bitcoin exchange caused the nominal price of a bitcoin to fraudulently drop to one cent on the Mt. Gox exchange, after a hacker allegedly used credentials from a Mt. Gox auditor's compromised computer illegally to transfer a large number of bitcoins to himself. He used the exchange's software to sell them all nominally, creating a massive "ask" order at any price. Within minutes the price corrected to its correct user-traded value. Accounts with the equivalent of more than $8,750,000 were affected. In order to prove that Mt.Gox still had control of the coins, the move of 424,242 bitcoins from "cold storage" to a Mt.Gox address was announced beforehand and executed in Block 132749.
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