Mt. Gox CEO Claims Innocence in Closing Arguments

The former CEO of defunct Japanese Bitcoin exchange Mt. Gox, Mark Karpeles, who may face a ten-year sentence over alleged embezzlement, has maintained his innocence in the closing arguments in a Tokyo court, Japanese public broadcaster NHK reported.

The infamous Mt. Gox hack of 2014 resulted in the loss of 850,000 Bitcoins (BTC) which were worth US$ 473 million at that time and it has become the first notable bitcoin theft in history. Since then, legal battles have raged between the exchange and its creditors.

According to an indictment against Karpeles in a Tokyo court earlier this month, claiming he stole funds worth 340 million yen ($3 million) from the exchange and manipulating data to inflate its cash balance between September and December 2017. The prosecution has asked for a ten-year prison sentence for Karpeles.

On Thursday, Karpeles admitted and apologized for his failure in protecting user’s digital assets from hacking, but denied his guilt on all charges in court.

Karpeles’s defense team also argued that the so-called “embezzled funds” were not client funds but the exchange’s revenues and the transfer of money to his own account was part of the exchange’s business. According to prosecutors, Karpeles took the funds to invest in a software development business.

The Mt. Gox trail has been taking place at the Tokyo District Court since last July. A verdict of this trial is expected on March 15, 2019.

According to a statement released in September by Mt. Gox’s trustee, Nobuaki Kobayashi claimed that he has liquidated almost 26 billion yuan ($230 million) in Bitcoin and Bitcoin Cash in four months. He also informed the public that he has sold 24,658 BTC and 25,331 BCH since the third quarter of 2017.

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