Remember
Mt.
Gox?
Originally,
it
was
a
card-trading
site
called
MTGOX,
short
for
Magic
The
Gathering
Online
Exchange
(there
was
no
sense
of
“Mountain”
in
the
name
at
all),
but
the
domain
changed
hands
and
purpose
in
the
early
days
of
cryptocurrency.
Operated
out
of
Japan
by
French
expatriate
Mark
Karpelès,
Mt.
Gox
rapidly
became
the
biggest
online
Bitcoin
exchange,
but
imploded
in
2014
when
the
company
was
forced
to
admit
that
it
had
lost
Bitcoins
worth
more
than
$0.5
billion
at
the
time
(they’d
be
worth
more
than
25
times
as
much
today).
As
we
wrote
back
then:
In
2014,
the
Big
Daddy
of
Bitcoin
exchanges,
Japan-based
Mt.
Gox,
made
a
“So
sorry,
they
seem
to
have
vanished”
announcement
about
a
whopping
650,000
Bitcoins,
worth
approximately
$800
each
at
the
time.The
mystery
of
the
missing
BTCs
was
at
first
blamed
on
a
cryptographic
flaw
in
the
Bitcoin
protocol
that
Mt.
Gox’s
coders
hadn’t
defended
against
properly
–
something
they
really
ought
to
have
done,
considering
that
they
were
sitting
on
half-a-billion
dollars
worth
of
other
people’s
assets.But
that
story
didn’t
wash
with
everyone,
not
least
those
who
thought
that
any
abuse
of
the
flaw
concerned
(it’s
euphemistically
known
as
transaction
malleability
if
you
would
like
to
look
it
up)
ought
to
have
been
visible,
albeit
too
late,
in
the
transaction
record.Some
people
suspected
Mt.
Gox
insiders
of
simply
taking
the
missing
Bitcoins
(or
some
of
them,
anyway)
for
themselves.Ironically,
the
very
sort
of
incautious
attitude
to
coding
that
would
make
a
transaction
malleability
exploit
possible
would
probably
also
make
it
possible
for
rogue
insiders
to
get
away
unnoticed
with
large-scale
Bitcoin
larceny.That’s
where
the
story
sat
throughout
the
second
half
of
2014:
something
bad
happened,
but
no-one
quite
knew
whom
to
blame.
But
on
New
Year’s
Day
2015,
as
we
noted
in
that
report,
Japanese
newspaper
Yomiuri
Shimbun
published
a
dramatic
article
in
which
it
openly
stated
that
there
was
“strong
suspicion”
that
most
of
the
missing
Bitcoins
were
ripped
off
from
inside.
The
paper
suggested
that
although
the
loss
of
BTC
7000
could
be
explained
by
cyberattack
(in
other
words,
that
crooks
outside
the
company’s
network
were
the
perpetrators),
there
was
no
evidence
of
cyberattack
in
repsect
of
the
remaining
BTC
643,000.
In
short,
the
reporters
at
Yomiuri
Shimbun
were
as
good
as
saying,
99%
of
the
crime
was
an
inside
job.
Karpelès,
for
his
part,
ultimately
received
a
suspended
prison
sentence
in
Japan,
but
that
was
because
he
was
found
guilty
of
misrepresenting
his
financial
position
to
potential
investors,
not
because
of
the
missing
Bitcoins.
Not
Karpelès
Ironically,
perhaps,
Karpeles
now
has
what
amounts
to
a
partial
exoneration
on
the
matter
of
the
many
missing
Bitcoins,
with
the
US
Department
of
Justice
unsealing
Mt.
Gox-related
charges
against
two
named
individuals:
Alexey
Bilyuchenko,
43,
and
Aleksandr
Verner,
29,
both
Russian
nationals,
are
charged
with
conspiring
to
launder
approximately
647,000
bitcoins
from
their
hack
of
Mt.
Gox.[…]
Bilyuchenko,
Verner,
and
their
co-conspirators
allegedly
used
their
unauthorized
access
to
Mt.
Gox’s
server
to
fraudulently
cause
bitcoin
to
be
transferred
from
Mt.
Gox’s
wallets
to
bitcoin
addresses
controlled
by
Bilyuchenko,
Verner,
and
their
co-conspirators.From
September
2011
through
at
least
May
2014,
Bilyuchenko,
Verner,
and
their
co-conspirators
allegedly
caused
the
theft
of
at
least
approximately
647,000
bitcoins
from
Mt.
Gox,
representing
the
vast
majority
of
the
bitcoins
belonging
to
Mt.
Gox’s
customers.Bilyuchenko,
Verner,
and
their
co-conspirators
allegedly
laundered
the
bulk
of
the
bitcoins
stolen
through
Mt.
Gox
principally
through
bitcoin
addresses
associated
with
accounts
Bilyuchenko,
Verner,
and
their
co-conspirators
controlled
at
two
other
online
bitcoin
exchanges.
In
an
intriguing
twist,
Bilyuchenko
is
also
charged
with
operating
one
of
those
“two
other
online
Bitcoin
exchanges”,
the
notorious
exchange
known
as
BTC-e,
along
with
a
third
individual
named
Alexander
Vinnik.
BTC-e
ran
from
2011
until
July
2017,
when
it
was
busted
and
shut
down
by
US
law
enforcment.
Vinnik
was
indicted
back
then
by
a
US
court
on
money-laundering
charges,
after
being
arrested
in
Greece.
(Since
then,
Vinnik
has
variously
been
in
custody
in
Greece;
extradited
to
France,
where
he
was
sent
to
prison
for
money
laundering;
returned
to
Greece
after
his
release;
and
then
extradited
to
the
US
to
face
charges
there.)
The
DOJ’s
press
release
about
these
new
charges,
relating
to
a
hack
that
now
dates
back
more
than
10
years,
says
simply
that
Bilyuchenko
and
Verner
are
“Russian
nationals”,
but
not
which
country
the
two
men
are
in
right
now.
But
US
Attorney
Ismail
J.
Ramsey
did
go
on
the
record
to
say:
For
years,
Bilyuchenko
and
his
co-conspirators
allegedly
operated
a
digital
currency
exchange
that
enabled
criminals
around
the
world
–
including
computer
hackers,
ransomware
actors,
narcotics
rings,
and
corrupt
public
officials
–
to
launder
billions
of
dollars.The
Department
of
Justice
will
work
tirelessly
to
identify
cyber
criminals,
no
matter
where
they
are.And
Bilyuchenko
and
his
co-conspirators
will
learn
that
the
Department
of
Justice
has
long
arms
and
an
even
longer
memory
for
crimes
that
harm
our
communities.
As
for
Mt.
Gox,
its
winding-up
process
is
at
last
drawing
to
a
close,
with
the
final
deadline
for
recognised
corporate
creditors
to
file
verification
documents
recently
extended
until
2023-06-15,
just
three
days
from
now.
Though
the
mills
of
the
Law
grind
slowly/Yet
they
grind
exceeding
small/Though
with
patience
they
stand
waiting/With
exactness
grind
they
all…
…or,
at
least,
we
can
but
hope
they
do
and
will.
LEARN
MORE
ABOUT
BTC-E
(AND
HOW
DARK
WEB
CROOKS
GET
CAUGHT)
We
talk
to
renowned
cybersecurity
author
Andy
Greenberg
about
his
excellent
book,
Tracers
in
the
Dark:
The
Global
Hunt
for
the
Crime
Lords
of
Cryptocurrency.
No
audio
player
below?
Listen
directly
on
Soundcloud.
Prefer
reading
to
listening?
Full
transcript
available.
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