Japanese Court Finds Former Mt Gox CEO Guilty of Data Manipulation

The Tokyo District Court has recently found Mark Karpeles, the former CEO of the defunct bitcoin exchange Mt. Gox, guilty of charges relating to data manipulation, although it also saw him escape some charges.

According to a report published by the Wall Street Journal, the court found Karpeles guilty of creating electronic records connecting to the cryptocurrency exchange’s books, but did not find him guilty of charges of breach of trust and embezzlement.

Karpeles was given a suspended sentence of two and a half years, and is required to maintain a clean record over the next four years in order to avoid going to jail. The court’s verdict comes years after Mt Gox filed for bankruptcy, in 2014, after allegedly being hacked for 850,000 BTC.

His lawyers reportedly noted in that he wasn’t responsible for the collapse of the exchange, but rather that he tried to prevent it. They wrote:

Mt. Gox did not collapse because of the defendant’s [Karpeles’] wrongdoing. On the contrary, the defendant was trying his hardest every day to prevent its collapse.

After the exchange went down roughly 200,000 BTC were later on found. The exchange’s collapse saw bitcoin’s price crash at the time, as at one point Mt Gox handled over 70% of the flagship cryptocurrency’s trading volume.

In December of last year, prosecutors were looking to get a 10-year sentence for Karpeles for embezzlement, alleging he used 340 million yen (about $3 million) of customers’ funds for his own use. In his defense, Karpeles insisted he didn’t illicitly used customers’ money, and pleaded not guilty while claiming he received loans from the exchange, which he planned on settling in the future.

Last year, a Japanese bankruptcy court sided with creditors who petitioned for the case to be moved to civil rehabilitation, allowing them to receive their locked up bitcoin in its original form, instead of having it converted into fiat according to the exchange rate of the time, of around $500 per BTC.

The cryptocurrency exchange’s trustee, Nobuaki Kobayashi, has set a deadline for creditors to file proof of their claims, after which he will submit the rehabilitation plan. In September of last year, he confirmed he sold $230 million worth of Bitcoin and Bitcoin Cash.

As Tether Premium Disappears, Bitfinex and Ethfinex Launch New IEO Platform: Tokinex

Avi Rosten

Prominent exchanges Bitfinex and Ethfinex have announced a new IEO (Initial Exchange Offering) platform.

The new platform, Tokinex, allows users to participate in pre-vetted token sales from new projects listing on the site. In a departure from other similar offerings such as Binance Launchpad, token issuers on Tokinex don’t have to pay any upfront fees for listing, while successful launches on the platform will also benefit from listing on both Bitfinex and Ethfinex.

The new exchange also utilizes the KYC service from Blockpass, which allows customers to complete KYC verification but without storing data on the exchange. The first token sale will be announced on May 23rd, with the sale taking place on 13th June.

Will Harborne, founder of Ethfinex, told CryptoGlobe:

Tokinex has been several months in development, incorporating feedback, testing and learning to reach a quality level users have come to expect at Bitfinex and Ethfinex. It has been carefully crafted to put the user experience front and centre, from incorporating Block Pass for KYC that is easy to use and does not store personal data, to being able to contribute existing assets directly from the user’s own wallet, rather than having to purchase a native platform token to participate.

IEOs in 2019

This latest platform from Bitfinex adds to the growing list of IEO platforms that have followed Binance, including OKEx, Huobi and Bittrex.

For Bitfinex, the news comes in the aftermath of fraud allegations in April from the New York Attorney General against Bitfinex and Tether, over alleged losses of over $850 million. However, the Tether Risk Premium, - a measure of how much the market believes Tether to be riskier than its underlying USD - has since almost completely disappeared, suggesting that investors at the moment have little concern over Tether’s value.

This is likely due to restored investor confidence in Bitfinex and Tether, after Bitfinex CTO Paolo Ardoino revealed on May 13th that the company had raised $1 billion in a private token sale. The chart below shows the impact of the announcement - with the premium on the BTC price on the Bitfinex Exchange narrowing to zero following several weeks where bitcoin was trading above its spot price.

Bitfinex Premium Narrows