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Mt. Gox Finds 200,000 Bitcoins in an Old File

Mt. Gox Finds 200,000 Bitcoins in an Old File
By Barry Levine

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The 200,000 bitcoins found by Mt. Gox represent about 24 percent of the coins that had gone missing when the exchange reported in February that it couldn't find 750,000 customer coins and 100,000 of its own, representing a whopping $450 million that accounted for about 7 percent of the world supply. Mt. Gox filed for bankruptcy Feb. 28.
 


The thing about virtual money is that it could be virtually anywhere. Which is what the Tokyo-based Mt. Gox found out, announcing on Friday that more than $100 million worth of bitcoins, about a quarter of the amount missing from that bitcoin exchange, have been found online in a file.

The ex-chief executive of Mt. Gox, Mark Karpeles, released a statement Thursday on the exchange's Web site about where the 200,000 bitcoins had been hiding. He said that after the site filed for bankruptcy, digital storage files known as wallets that had been in use before June of 2011 were searched. Some 200,000 bitcoins were found which, if sold Friday, would bring in $114 million to $116 million.

"On March 7, 2014, Mt. Gox Co., Ltd. confirmed," the statement said, "that an old-format wallet which was used prior to June 2011 held a balance of approximately 200,000 BTC." The site said the bitcoins are now in offline wallets, which apparently means digital storage that is not connected to the Net.

Unfrozen Assets

The company said it reported the found bitcoins to its lawyers the next day. It's not clear why Mt. Gox waited until March 21 to announce the finding to the public.

These bitcoins represent about 24 percent of the coins that had gone missing when the exchange reported in February that it couldn't find 750,000 customer coins and 100,000 of its own, representing a whopping $450 million that accounted for about 7 percent of the worldwide supply. On Feb. 28 the site filed for bankruptcy. In its announcement Friday, the company noted that its search for the missing bitcoins continues.

As traders and keepers of an unregulated digital currency, the Japan-based exchange was not governed by banking regulations and there was no deposit insurance.

In a separate development, small amounts of frozen assets -- about $1,000 worth -- of Mt. Gox's American affiliate were released Thursday. They had been frozen on March 11, but U.S. District Judge Gary Feinerman in Chicago decided Thursday to loosen restraints on some of the coins to see where they went. It's not clear how the bitcoins will be followed.

Code Fix

A class-action suit was filed against Mt. Gox last month for fraud, and lawyers for the plaintiffs had asked the judge for the revised order releasing some of the coins.

On Wednesday, the core software developers for the troubled digital currency released an updated version, 0.9.0, of the code governing the bitcoin network. The update reportedly fixes a bug that Mt. Gox has blamed for the disappearance of its stash.

The transaction malleability bug allowed the changing of the identifier of a bitcoin transaction before it was confirmed, which had reportedly allowed hackers to conduct multiple transactions that an exchange might only see as one. Some experts have also said that Mt. Gox complicated the bug through its own faulty software.
 

Tell Us What You Think
Comment:

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gwm:

Posted: 2014-04-07 @ 9:04pm PT
I don't believe that the bitcoins were stolen. I find it more likely that they were lost due to a data loss. They probably found the 200,000 bitcoins while going through their backups trying to recover the lost data (bitcoins).



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