MtGox CEO arrested over bitcoins loss

Japanese police have reportedly arrested the CEO of the collapsed MtGox bitcoin exchange.

Japanese police have arrested Mark Karpeles, chief executive of the collapsed MtGox bitcoin exchange, over the loss of nearly $US390 million ($A535 million) worth of the virtual currency, local media said.

Karpeles, 30, is suspected of having accessed the computer system of the exchange and falsifying data on its outstanding balance, Kyodo News and public broadcaster NHK said.

The global virtual currency community was shaken by the shuttering of MtGox, which froze withdrawals in February 2014 because of what the firm said was a bug in the software underpinning bitcoin that allowed hackers to pilfer them.

The exchange filed for bankruptcy protection soon after, admitting it had lost 850,000 coins worth Y48 billion ($A530.18 million) at the time.

Karpeles later said he had found about 200,000 of the lost bitcoins in a “cold wallet” – a storage device such as a memory stick that is not connected to other computers.

Bitcoins are generated by complex chains of interactions among a huge network of computers around the planet and are not backed by any government or central bank.


Read more ... source: Bitcoin Warrior