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MtGox accepted new customers JUST DAYS before collapse

Was the Bitcoin exchange taken by surprise?

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MtGox was still accepting new customers right up until the eve of its shutdown, The Reg has learned.

A Reg reader has told us he was able to open a verified account just days before the Bitcoin exchange collapsed.

This suggests that the MtGox authorities were caught by surprise, rather than planning for the shutdown.

Eddie, a long-time Reg reader, waited for months to have his account verified. The process requires Bitcoin users to submit ID and proof of address, whereupon they can deposit and withdraw the fiat currency. His approval took place after the exchange had already put a hold on all withdrawals in the wake of an issue with transaction malleability.

He said: "After quite a wait, Gox finally verified my account (a prerequisite for withdrawals) late on Friday 21st, suggesting they were overtaken by events quite quickly, or at least that bits of the business were not fully aware of just how precarious things were.

"When this was confirmed I assumed they'd finally got their act together and things were about to improve. So hearing via Twitter that they'd gone dark was a bit of a kick in the teeth."

Just three days after the verification, the exchange went dark, resigned its seat on the Bitcoin Foundation board and deleted its Twitter account..

All in all, Eddie lost hundreds of pounds worth of Bitcoin and has little hope of getting them back. However, don't be too worried about him.

"I'm not ready to call the Samaritans just yet," Eddie continued.

Many users withdrew their Bitcoins after Mt Gox halted cash withdrawals earlier this year, a move which presaged its eventual collapse.

MtGox CEO Mark Karpeles issued a statement yesterday in which he insisted he had not done a runner.

"As there is a lot of speculation regarding MtGox and its future, I would like to use this opportunity to reassure everyone that I am still in Japan, and working very hard with the support of different parties to find a solution to our recent issues,” he said.

Sadly for the Bitcoin boss, there may be nowhere to hide even if he was to run away. Japanese authorities have already begun an investigation into the collapse of Gox, whilst American investigators have reportedly issued the exchange with a subpoena.

Manhattan US Attorney Preet Bharara has sent subpoenas to Mt Gox and other Bitcoin companies in a bid to see how they dealt with recent cyber attacks. ®

Internet Security Threat Report 2014

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