Does the Mt. Gox Investigation Actually Matter?

Hiro Nakamura
4 years ago

Suppose the Japanese Police have conducted an investigation deep into the Mt. Gox affair, and they’ve got all this evidence to prove negligence or even theft on the part of Mark Karpeles. The question is: so what? What difference will that make? Will it magically make the funds re-appear in the accounts of investors?

That should, after all, be the focus of all operations. To get the money returned the Mt. Gox account holders. Anything that doesn’t center on that will ultimately be a fruitless exercise in state power. Mt. Gox robbed a lot of us of a lot of money, and most don’t particularly care whether Karpeles spends an hour or a lifetime in jail, assuming we get our money back. That is the essential card in the deck. Everything else fails to matter nearly as much. Can we get our money back and how soon? These are the only two real questions most of us have.

An article in the Financial Times says:

Japanese police may have arrested Mr Karpelès on the apparently narrow grounds of allegedly padding his account at Mt Gox but they hope for a broad explanation from him about the company’s collapse and the disappearance of the bitcoins.

Another, in the Japan Times, reads:

The police will probably issue another warrant accusing him of professional embezzlement over the suspected misuse of funds, police sources said.

All of this centers on state power. It is about the exercise of the Japanese police power more than it is about restoration of emptied accounts. The focus of the media and the police in all this is despicable in that it does nothing at all for the victims. We will not echo the narrative here. Instead, we will counter it with the ringing question of the day: where is the money, Mark? Can you retrieve any of it, at all?

Also read: Goxxed No More: First Decentralized Bitcoin Exchange Launches Today

That would certainly be ideal. Most would probably say to let him go following that. What need is there to have his skin if the wrong had been righted? In any case, it doesn’t look like Karpeles would be able to return the funds. It seems he would have originally done so, in some manner or another, if that had been possible. The run on Mt. Gox would never have happened in the first place if the servers hadn’t started breaking down. People became mighty suspicious, but then again, thousands of dollars in bitcoins continued to pour into Mt. Gox addresses for hours after the exchange advised people to stop making deposits. These were likely automated deposits, but it demonstrates the magnitude of the exchange at the time.

There are now decentralized exchanges cropping up, and they should be used as wisely as possible. The less the amount of centralized points of disaster, the better. Mt. Gox may never return funds to its holders. Its founder may, however, spend a considerable amount of time in a Japanese prison. For some, this might seem like justice. For those who have lost their money, it might seem like cold comfort at best.

Last modified (UTC): August 5, 2015 10:29

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