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Mt. Gox CEO apologizes for bitcoin withdrawal freeze

Feb. 17, 2014 at 3:12 PM   |   Comments

TOKYO, Feb. 17 (UPI) -- The head of Mt. Gox, a Tokyo-based bitcoin exchange, said customers are concerned about their funds' security, but didn't explain why withdrawals were frozen.

Mark Karpeles, chief executive officer of Tibanne, which operates Mt. Gox, declined to discuss growing customer concerns about the financial status of the exchange, which has frozen customer withdrawals for more than a week, saying responses would be limited to only technical-related questions.

"We understand your concern on this issue," Karpeles told the Wall Street Journal in an email, "however, any customer-related questions are confidential."

Later Monday, Mt. Gox posted a statement on its website indicating it implemented a solution and "should be able to resume withdrawals soon." The statement said Mt. Gox would start withdrawals at a moderate pace and impose new daily and monthly limits.

Customers of the company have been pressing the trading platform to disclose more about its financial well-being.

In his email interview with the Journal, Karpeles repeatedly said the company's solvency was confidential but that it had discussed its business model with Japanese authorities "to ensure that we are operating within the law here."

Mt. Gox has been battling technical problems since July, when it first halted withdrawals in dollars. When it halted customer withdrawals Feb. 7, it blamed its issues on a glitch in the bitcoin software. Last week Mt. Gox said it was hit by fraudulent requests for payment by users taking advantage of a feature in the core protocol known as "transaction malleability."

"We sincerely apologize for this incident," Karpeles said of the malleability issue, "however, please understand that we are not the developers of Bitcoin."

He said that the trading platform was trying its best "to work out the problems and make it better for our customers."

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