Mark Karpelès Explained

Mark Karpelès
Birth Place:Chenôve, France
Birthname:Mark Robert Karpelès
Occupation:Entrepreneur
Known For:Former CEO of Mt. Gox

Mark Robert Karpelès (born 1985) is the former CEO of bitcoin exchange Mt. Gox.[1] Born in France, he moved to Japan in 2009.[2] [3] Under his leadership, Mt. Gox was the world's largest bitcoin exchange, handling over 70% of all bitcoin transactions at its peak before filing for bankruptcy in 2014.[4] [5] [6] Karpelès was subsequently arrested and convicted of data manipulation related to his role at Mt. Gox.

Early life and education

Born in 1985 in Chenôve, France, Karpelès is the child of geologist Anne-Robert Karpelès.[7] [8] He was raised in Dijon.[7] [9] From 1995 to 2000, he attended Collège Prieuré de Binson in Châtillon-sur-Marne, near Dormans.[10] He then spent one year at Lycée Claude Bernard in Paris before completing his education in 2003 at Lycée Louis Armand in Paris.[10]

Career

In 2009, Karpelès founded Tibanne Co. Ltd., a Japan-based bitcoin related technology provider, where he served as CEO.[11] [12] He was a founding member of the Bitcoin Foundation, created in 2012 with a mission to standardize and promote bitcoin, and served on its board until February 2014.[13] [14]

In 2011, Karpelès acquired the Mt. Gox bitcoin exchange site from programmer Jed McCaleb, with its original owner receiving 12% of the shares of the new company.[15] [16] [17] Under his management, the platform handled the majority of global Bitcoin transactions by 2014.[18] [19] Despite its growth, Mt. Gox faced growing operational, security, and financial challenges, including having $5 million seized from its accounts by the U.S. Department of Homeland Security in 2013 for allegedly lying on bank documents.[20] [21] [22] Mt. Gox then experienced a theft of a significant amount of Bitcoin in 2014.[23] Mt. Gox subsequently filed for bankruptcy, and Karpelès was arrested that year and eventually convicted of data manipulation and falsification of records at Mt. Gox.[24] [25] The collapse of Mt. Gox, and Karpeles's role in it, led Japan to create the first formal regulations for cryptocurrency exchanges and virtual currencies.[26]

After the collapse of Mt. Gox, Karpelès joined London Trust Media, the company behind Freenode and Private Internet Access, as its CTO in April 2018.[27] In 2023, Karpelès was appointed as the minister of technology for Joseon, which operates a blockchain to manage its currency Mun.[28] In 2024, Karpelès announced the launch of EllipX, a new cryptocurrency exchange, which will launch in Poland with Karpelès serving as chief technology officer.[29] [30]

Arrests and convictions

In 2010, at the age of 25, Karpelès was found guilty of fraud during a trial in absentia in France related to his actions on a private server, and he was sentenced to one year in jail.[31] [32] Karpelès had previously been arrested twice in France for charges related to computer fraud, and was convicted and received a suspended sentence of three months as a result of one of the arrests.[33]

In April 2014, after Mt. Gox had filed for bankruptcy, Karpelès was subpoenaed by the United States Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) to testify in Washington, D.C.[34] [35] [36] He responded through his lawyers that he would not be attending the deposition.[37]

On 1 August 2015, Karpelès was arrested by Japanese authorities on suspicion of accessing the Mt. Gox computer system to manipulate account balances.[38] [39] [40] Tokyo prosecutors indicted Karpelès on a series of charges, including embezzlement and aggravated breach of trust, and called for a 10-year prison sentence.[41] Karpelès pleaded not guilty to the charges.[42] On 14 March 2019, the Tokyo District Court found Karpelès guilty of one count of data manipulation for falsifying data to inflate Mt. Gox's holdings by $33.5 million and not guilty of all other charges.[43] He was sentenced to 30 months in prison, suspended for four years, which meant he would serve no time in prison unless he committed additional offenses over the next four years.[44] [45] The court said Karpelès had inflicted "massive harm to the trust of his users" and there was "no excuse" for him to "abuse his status and authority to perform clever criminal acts". Karpelès issued a statement saying he was "happy to be judged not guilty" on the more serious charges and was discussing how to proceed with his lawyers regarding his conviction on the falsifying data charge.[46]

During the 2015 trial of Ross William Ulbricht for operating the Silk Road marketplace, his defense argued that Karpelès, rather than Ulbricht, was the individual behind the pseudonym "Dread Pirate Roberts".[47] Homeland Security Investigations agent Jared Der-Yeghiayan had also suspected Karpelès during a 2012–2013 investigation.[48] Karpelès denied any involvement, and Ulbricht was ultimately convicted.[49] [50]

Notes and References

  1. News: Mt. Gox CEO Mark Karpeles: 'I am still in Japan' . 2014-02-26 . Forbes . King . Leo . 2014-02-27.
  2. News: Warnock . Eleanor . Mochizuki . Takashi . 2014-02-28 . Bitcoin's Mt. Gox: a look at the man in charge . The Wall Street Journal.
  3. News: Philippe . Berry . 2014-02-27 . MtGox: Mark Karpèles, un "supergeek" français au cœur du scandale bitcoin . 2014-02-27 . 20 Minutes . fr.
  4. Web site: 2024-07-08 . Bitcoin rebounds to $57,000 after billions in Mt. Gox refunds fueled a selloff . 2024-07-11 . Quartz . en.
  5. Web site: 2024-07-08 . Germans, Mt. Gox, or Feds: Who Caused the Bitcoin Dip? . 2024-07-11 . Financial and Business News Finance Magnates . en.
  6. Web site: Zielinski . Radek . 2024-07-08 . Mt. Gox to repay investors in Bitcoin . 2024-07-11 . ReadWrite . en-US.
  7. News: Le génie côte-d'orien qui fait trembler le net . Le Journal de Saône et Loire . 2014-01-03 . Vincent . Gautronneau . fr .
  8. News: Aubourg . Lucie . Former Bitcoin Exchange CEO Charged With Embezzlement in Japan . Vice . 11 September 2015.
  9. News: Mick . Jason . 5 March 2014 . Bitcoin King: Mt. Gox CEO Mark Karpelès' History of Arrests, Firings . . 9 March 2014 . https://web.archive.org/web/20140309102115/http://www.dailytech.com/Bitcoin+King+Mt+Gox+CEO+Mark+Karpels+History+of+Arrests+Firings/article34442.htm . 9 March 2014 . dead .
  10. Web site: Mark Robert KARPELÈS, 28 ans (TOKYO, CHATILLON SUR MARNE, PARIS) . Copains d'avant – L'Internaute . CCM Benchmark Group . fr . 2014-02-27.
  11. Web site: US judge freezes assets of Mt.Gox bitcoin exchange boss. 12 March 2014. CNBC.
  12. News: A Bitcoin Exchange Goes for Respectability. https://web.archive.org/web/20130607113530/http://www.businessweek.com/articles/2013-05-31/a-bitcoin-exchange-goes-for-respectability. dead. 7 June 2013. David Meyer. Businessweek.com. 31 May 2013 . 24 February 2015.
  13. News: Mt. Gox resigns from Bitcoin Foundation . Reuters . 23 February 2014 . 25 February 2014 .
  14. Web site: Mt. Gox quits Bitcoin Foundation board. 24 February 2014. PCWorld. 24 February 2015.
  15. Web site: Erosion of Faith Was Death Knell for Mt. Gox. . The New York Times. 28 February 2014. 24 February 2015.
  16. Web site: 1 April 2013. Jeffries. Adrianne. Barons of Bitcoin. The Verge. 13 March 2014.
  17. Web site: Bitcoin Exchange Mt. Gox Files for Bankruptcy in U.S. -- 2nd Update - WSJ.com . online.wsj.com . dead . https://web.archive.org/web/20140311030453/http://online.wsj.com/article/BT-CO-20140310-712183.html . 2014-03-11.
  18. News: Mt Gox: The brief reign of bitcoin's top exchange .
  19. News: Apparent Theft at Mt. Gox Shakes Bitcoin World .
  20. McMillan . Robert . The Inside Story of Mt. Gox, Bitcoin's $460 Million Disaster . 2024-09-08 . Wired . en-US . 1059-1028.
  21. News: Pagliery . Jose . As Mt.Gox website is taken down, Bitcoin's future is called into question . CNNMoney . 25 February 2014.
  22. News: Dillet . Romain . Feds Seize Another $2.1 Million From Mt. Gox, Adding Up To $5 Million . TechCrunch . 23 August 2013.
  23. News: Hern . Alex . 2014-02-28 . MtGox files for bankruptcy in Japan after collapse of bitcoin exchange . 2024-09-08 . The Guardian . en-GB . 0261-3077.
  24. Bitcoin Exchange Mt. Gox Files for U.S. Bankruptcy as Death Spiral Continues. WIRED. 24 February 2015.
  25. McMillan . Robert . The Inside Story of Mt. Gox, Bitcoin's $460 Million Disaster . 2024-07-11 . Wired . en-US . 1059-1028.
  26. News: Beattie . Elizabeth . The unsinkable Mark Karpeles is willing to give Tokyo another shot . . October 21, 2024.
  27. Web site: Goldman . Joshua . Former Mt. Gox bitcoin exchange CEO Karpeles lands new job . CNET . 2018-04-23 . 2018-04-29.
  28. Web site: Tomlin . Bennett . 2023-12-19 . Duke Roger Ver becomes finance minister for Joseon . 2024-07-11 . Protos . en-US.
  29. News: Former Mt. Gox CEO to launch EllipX crypto exchange in Europe .
  30. Web site: 2024-09-04 . Former Mt. Gox CEO Mark Karpeles to Launch New Crypto Exchange This Month . 2024-09-08 . Blockhead . en.
  31. News: Farivar . Cyrus . 1 August 2014 . Why the head of Mt. Gox Bitcoin exchange should be in jail . 1 August 2014 . Ars Technica.
  32. News: Alonso . Pierre . 1 August 2014 . En France, le passé trouble de l'ancien " baron du bitcoin " . Old bitcoin baron's old trouble in France . 1 August 2014 . . fr.
  33. News: Knight . Sophie . At Mt. Gox bitcoin hub, 'geek' CEO sought both control and escape . . 22 April 2014.
  34. News: 15 April 2014 . Mt. Gox founder won't appear in U.S. for questions about bankruptcy case . 24 February 2015 . Reuters.
  35. Web site: Mt. Gox founder won't attend US bankruptcy hearing . 24 February 2015 . CNET . CBS Interactive.
  36. Web site: John Ribeiro . 15 April 2014 . Mt. Gox seeks postponement of CEO's U.S. court deposition . 24 February 2015 . Computerworld.
  37. News: 15 April 2014 . BBC News - MtGox chief refuses to go to Bitcoin bankruptcy hearing . 24 February 2015 . BBC News.
  38. News: 1 August 2015 . MtGox bitcoin chief Mark Karpeles arrested in Japan . 1 August 2015 . BBC News.
  39. News: Jonathan Soble . 1 August 2015 . Mark Karpeles, Chief of Bankrupt Bitcoin Exchange, Is Arrested in Tokyo . 1 August 2015 . The New York Times.
  40. News: 1 August 2015 . Mt. Gox bitcoin firm head arrested . 1 August 2015 . The Japan News by The Yomiuri Shimbun.
  41. Web site: 2019-03-15 . Mt Gox Bitcoin exchange's Karpeles avoids jail time in Japan . 2024-07-11 . AP News . en.
  42. News: 11 July 2017 . Chief of bitcoin exchange Mt. Gox denies embezzlement as trial opens . 2017-11-06 . Reuters.
  43. News: 2019-03-15 . Former Mt. Gox CEO Mark Karpeles Gets Suspended Jail Term . 2024-07-11 . Bloomberg.com . en.
  44. News: Dooley . Ben . 2019-03-15 . Bitcoin Tycoon Who Oversaw Mt. Gox Implosion Gets Suspended Sentence . 2024-07-11 . The New York Times . en-US . 0362-4331.
  45. Web site: 2019-03-14 . MtGox bitcoin founder learns fate on embezzlement charges . 2024-07-11 . France 24 . en.
  46. Web site: Pham . Sherisse . Former Mt. Gox chief Mark Karpeles acquitted of most charges in major bitcoin case . CNN . 15 March 2019 . 15 March 2019.
  47. Web site: Paul . Kari . 2015-01-15 . Defense in Silk Road Trial Says Mt. Gox CEO Was the Real Dread Pirate Roberts . 2019-05-31 . Vice . en-US.
  48. Web site: Jeong . Sarah . Was Mt. Gox CEO The Dread Pirate Roberts? The DHS Once Believed It . 2024-09-10 . Forbes . en.
  49. Web site: Koebler . Jason . 2015-01-16 . Mt. Gox CEO Denies Silk Road Involvement: 'I Am Not Dread Pirate Roberts' . 2019-05-31 . Vice . en-US.
  50. Web site: Mullin . Joe . 4 February 2015 . Ulbricht guilty in Silk Road online drug-trafficking trial . 4 February 2015 . Ars Technica.

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