Charges filed against French head of defunct Bitcoin exchange

The costs are tied to allegations that Karpeles falsified knowledge whereas one other pertains to claims he pocketed tens of millions of dollars of Bitcoin deposits.

The charges, which could not be immediately confirmed, come after France-born Mark Karpeles, 30, was taken into police custody in Tokyo last month over the affair.

A lawyer for Mr Karpelès said that his client, who is considering filing for personal bankruptcy, denies the charges and that the expenses at the centre of the allegations had all been properly lodged with MtGox’s accountants. The Mt Gox exchange that he headed – reportedly the largest in the world – closed down a year ago after millions in bitcoin deposits disappeared from its digital vaults.

The public prosecutor’s office in Tokyo, which brought charges against Karpeles on Friday, would not confirm the exact amount of currency that remains missing.

Tokyo-based MtGox froze withdrawals in early 2014 and was later shuttered over the missing money, which it said was linked to a bug in the software underpinning Bitcoins that allowed hackers to pilfer them.

As per Yahoo News, he was first taken into custody after claims surfaced that he had manipulated the data and also transferred funds to firms that were under his control during the period of 2011 and 2013.

The former head of the collapsed bitcoin exchange MtGox has been charged in Japan with embezzlement.

Bitcoins are generated by complicated chains of interactions amongst an enormous community of computer systems across the planet, and will not be backed by any authorities or central financial institution, in contrast to conventional currencies. “The bitcoin exchange later claimed to have found 200,000 virtual money in a “forgotten” digital wallet”.

However, the whereabouts of the money and his involvement appear far from solved.

Backers say virtual currencies provide an efficient and anonymous way to store and transfer funds online. But critics argue the lack of legal framework governing the currency, the opaque way it is traded and its volatility make it risky.