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MtGox files for bankruptcy protection in Japan

The saga of MtGox has taken another turn, into a cul-de-sac by the looks of things, with the Bitcoin exchange filing for bankruptcy protection in Tokyo.

CEO Mark Karpeles has appeared on Japanese television and admitted that a weakness in MtGox’s system allowed for the theft of a huge chunk of virtual currency, which was the reason MtGox suddenly vanished offline on Tuesday.

Following the incident, on the placeholder web page put up at the MtGox URL, Karpeles stated: “I am still in Japan, and working very hard with the support of different parties to find a solution to our recent issues.”

He promised further announcements and updates on the page, but nothing has been posted about this latest development as we write this piece.

Both Japanese and US authorities launched investigations into MtGox following the incident. New York-based prosecutors reportedly issued a subpoena before the Bitcoin exchange went offline, and Yoshihida Suga, Japan’s chief cabinet secretary, said: “Once we have full knowledge of what happened, we will take action if necessary.”

Speaking in a Tokyo court today, Karpeles apologised for the trouble he had caused investors, according to CBC News. Kyodo News put MtGox’s debts at over 6.5 billion yen (£38 million), far exceeding its assets.