Mark Karpeles: Mt. Gox Grew Too Fast, Too Quickly

Mt. Gox CEO Mark Karpeles has given his first media interview to the WSJ, admitting leadership failures.

AccessTimeIconJun 27, 2014 at 10:24 a.m. UTC
Updated May 2, 2022 at 4:02 p.m. UTC

CEO of Mt. Gox, Mark Karpeles, has finally broken his silence to tell the world how it feels to lose 850,000 bitcoins.

In an exclusive interview with the Wall Street Journal’s Tokyo reporters Takashi Mochizuki and Eleanor Warnock, Karpeles revealed he was "scared, frustrated and angry" in February when he realized the extent of the now-defunct exchange's losses, which total $499,027,945 at today's exchange rate.

The weakest point

He lamented that as the head of the company, it had been his mission to protect customers and employees, admitting that "The weakest point of my company was management," for failing to lay out appropriate corporate structures or hire experienced executives.

Karpeles also admitted the company grew too fast for him to handle, something often suggested by both supporters and enemies alike.

Many of Mt. Gox's former customers and staff will no doubt be pleased to hear these confessions in the absence of any other compensation. Karpeles believes now that aside from the 200,000 BTC subsequently recovered, no further bitcoins will be found.

He does plan to auction off his domain name assets in one attempt to return some funds, including bitcoins.com and akb.com (a popular name in Japan thanks to pop group AKB48).

Then and now

Karpeles now lives alone with his cat in his upmarket apartment in the south-west of central Tokyo, where he still operates his web services company Tibanne.

Responding to accusations from angry creditors that his lifestyle choices remain extravagant, Karpeles said:

"I swear I haven’t been doing anything too luxurious. Some people say I still own bitcoins or have a yacht, but that’s not true."

The CEO added that he would like to attend Tokyo's weekly bitcoin meetup "when things settle down" to explain the course of events to users in his own words.

Karpeles_workspace

According to the WSJ report, he has also had many sleepless nights, always worried about the fate of Gox's bitcoins and apparently himself:

"If anyone wants to start a bitcoin exchange, I would say, 'Be sure to have 24-hour security guards'."

As well as the hacking attack that saw 850,000 BTC vanish, there had also been physical break-ins at the office and one former employee stands accused of stealing sensitive data.

Speaking of a rescue

Karpeles is still officially the CEO of Mt. Gox, though he no longer has any control over the company's remaining funds and a police investigation into what happened is ongoing.

There are at least two competing groups trying to take control of Mt. Gox with differing plans for reactivating the company and attempting to make creditors whole: Sunlot Holdings' SaveGox, and a team of Tokyo locals supported by Chinese exchange OKCoin.

Karpeles said he supported a rescue plan, but added that whatever customer funds remained should not be touched, "Any buyers should use their own money to rehabilitate the exchange, not Mt. Gox’s."

When asked if he regretted buying the exchange, the CEO mused, "Half-yes. I learned a lot, but I lost a lot."

Co-authored by Jon Southurst and Grace Caffyn

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
Three Arrows Paper Trail Leads to Trading Desk Obscured Via Offshore Entities

As Three Arrows Capital collapsed under market pressure, its much-lesser known trading desk, TPS Capital, remained active, sources say. But a complex ownership structure might frustrate creditors' efforts to collect.

CoinDesk - Unknown
2
CoinDesk - Unknown
June Was Bitcoin’s Worst Month Ever

Plus, European crypto regulation comes into view.

CoinDesk - Unknown
3
CoinDesk - Unknown
What Traders Are Saying About Bitcoin's Biggest Monthly Loss in 11 Years

Poor macroeconomic sentiment, fears of inflation and systemic risks from the crypto market pushed the cryptocurrency below 2017’s highs.

CoinDesk - Unknown
4
CoinDesk - Unknown
Three Arrows Capital Files for Bankruptcy in New York Tied to British Virgin Islands Proceeding

A British Virgin Islands court ordered Three Arrows' BVI branch into liquidation earlier this week.

CoinDesk - Unknown