Business

Erik Gibbs

Tokyo court hands down surprise ruling against Mt. Gox CEO Mark Karpeles

After years of waiting, the next chapter in the Mt. Gox cryptocurrency exchange saga has finally drawn to a close. The exchange’s founder and former CEO, Mark Karpeles, stood trial in Tokyo for his role in the demise of the exchange, ultimately being charged with embezzlement, price manipulation and other charges. The Japanese court has issued its verdict and it certainly wasn’t what any in the crypto community had expected given the magnitude of the case.

A Tokyo District Court has ruled that Karpeles is not guilty of embezzlement, erasing any chance that the suspected shyster would spend any significant time behind bars. The court did find, however, that he was most likely guilty of manipulating data on the Mt. Gox’s trading system, and sentenced him to 30 months in prison. Karpeles was saved again, as this sentence was suspended for four years.

The legal team for Karpeles did a great job at convincing the court that the 33-year-old Frenchman was not involved when around $430 million suddenly disappeared from the exchange in 2014 due to the platform reportedly being hacked. Mt. Gox suddenly closed down at a time that it controlled around 80% of the Bitcoin Core (BTC) trading. Karpeles has maintained his innocence, but many have always felt that he had been at the center of the exchange’s losses, which amounted to over $400 million at the time.

If anything positive came out of the supposed hack and loss of funds, it was that the Mt. Gox case because the impetus for the creation of crypto regulations in Japan. This has helped the country become one of the forerunners in the evolution of digital currencies as an alternative to fiat and has allowed Japan’s crypto industry to become more stable than as has been seen in other countries.

Karpeles isn’t completely off the hook yet. A class-action lawsuit was brought against him in the U.S. and a judge in Illinois denied his motion earlier this week to have that suit dismissed. Karpeles had asserted that the U.S. courts don’t have jurisdiction to hear the case, but Northern District of Illinois Judge Gary Feinerman disagreed and is going to the let the suit continue.

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