Mark Karpeles, the head of defunct Bitcoin exchange MtGox, manipulated its computer system at least 30 times over a couple of years, a report says.
The fresh allegation against France-born Karpeles, 30, follows his arrest on Saturday by Tokyo police, more than a year after the once-dominant exchange collapsed in the wake of fraud allegations.
Citing investigators, Japan’s top-selling Yomiuri newspaper said Karpeles fraudulently tinkered with data and transferred funds to other firms controlled by him dozens of times between 2011 and 2013.
Police are questioning Karpeles about his alleged spending of customer deposits worth about 1.1 billion yen ($A12.17 million), according to public broadcaster NHK and the Yomiuri.
Officially, Karpeles was arrested for allegedly manipulating data in 2013 to artificially create about $US1 million in Bitcoins.
But police were also investigating his possible involvement in the massive loss of hundreds of millions of dollars worth of the virtual currency last year, local media have said.
In Japan police can hold a suspect without charge for up to three weeks, during which time they may carry out intense interrogations in an attempt to extract a confession. Karpeles is currently in police custody.
In response to the arrest, Tokyo said it would boost efforts to regulate the crypto-currency