Bitcoin Firm Mt Gox Wins Brief Us Bankruptcy Protection - 11/03/2014
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Troubled Japanese bitcoin exchange Mt Gox has won temporary bankruptcy protection in
the US. A judge in Dallas, Texas, agreed to protect
the firm's assets and temporarily halt two US lawsuits while bankruptcy proceedings occur
in Japan. The firm filed for bankruptcy in Japan in
February after losing about $473m (£284m) worth of customers' bitcoins to what it says
was a hacking attack. Mt Gox is scheduled to return to court on
1 April to extend the protections. The firm filed for Chapter 15 protection in
the US late on Sunday. The filing asks the US bankruptcy court to
recognize Mt Gox's bankruptcy in Japan and protect its US assets.
'Massive fraud' And it gives Mt Gox a temporary reprieve against
two US lawsuits: one a class-action suit in Chicago filed by an Illinois resident, and
another a $75m breach-of-contract case filed in Seattle by Coinlab Inc.
At the time of the Mt Gox theft, about 750,000 customer bitcoins were stolen as well as close
to 100,000 of Mt Gox's own bitcoins. That amounts to about 7% of all the bitcoins
in existence. Steven Woodrow, the lawyer leading the Chicago
class-action suit, told Judge Harlin Hale that the case was a "massive fraud".
Mt Gox's attorney, David Parham, denied there was any fraud and said the firm and its founder,
Mark Karpeles, were complying with the terms of the Japanese bankruptcy proceeding.
