Mt. Gox, The Tokyo-Based Bitcoin Exchange, Resigns From Bitcoin Foundation's Board Of Directors

 @SnehaShankar30
on February 24 2014 6:50 AM
Bitcoin
Some of Bitcoin enthusiast Mike Caldwell's coins are pictured at his office in this photo illustration in Sandy, Utah, on Jan.31, 2014. Reuters/Jim Urquhart

Mark Karpeles, CEO of Mt. Gox, the Tokyo-based Bitcoin exchange, resigned from the board of directors of Bitcoin Foundation on Sunday.

Jinyoung Lee Englund, director of public affairs for Bitcoin Foundation, confirmed the news of Karpeles’ resignation on Sunday night and said that it is effective immediately. The resignation is the latest development, following a string of technical difficulties on the exchange, which led to the freezing of withdrawals. 

“Effective immediately, Mt. Gox has submitted their resignation from the board of directors. We are grateful for their early and valuable contributions as a founding member in launching the Bitcoin Foundation. MtGox Co. Ltd. (Japan) held one of the three elected industry member seats. Further details, including election procedures, will be forthcoming,” a statement released by Bitcoin said, quoting Jon Matonis, Mt. Gox group's executive director.

Bitcoin Foundation’s chief scientist Gavin Andresen said that the foundation would fix these problems.

Later, Mt. Gox, which is one of the founding members of the Bitcoin Foundation, said that there is a “bug in the Bitcoin software” that could allow the transactions to be altered, causing the value of the digital currency to fall farther. Mt. Gox halted withdrawals citing technical difficulties without saying when services would resume.

Bitcoins on Mt. Gox traded at about $232 on Monday in Tokyo, while the Bitstamp index bitcoin traded at around $568, Reuters reported.

"The issues that Mt. Gox has been experiencing are due to an unfortunate interaction between Mt. Gox's implementation of their highly customized wallet software, their customer support procedures, and their unpreparedness for transaction malleability, a technical detail that allows changes to the way transactions are identified," Andresen said in a statement on the Foundation's blog on Feb. 10.

The resignation of Karpeles follows the departure of Charlie Shrem, CEO of BitInstant, after he was arrested in January on money laundering charges and connections to an alleged online illegal drugs marketplace.

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