In 2014, Mt. Gox, once the leading Bitcoin exchange, experienced a devastating collapse following a massive hack that resulted in the loss of hundreds of thousands of Bitcoin.
Over three years, the hacker gradually siphoned around 650,000 BTC from the exchange, with many of these Bitcoins allegedly laundered on BTC-e. Founded by Alexander Vinnik and Aleksandr Bilyuchenko, both of whom were convicted for their involvement, BTC-e played a role in the aftermath of Mt. Gox’s downfall.
Forensic analyses indicate that the Mt. Gox hacker still holds approximately 79,957 BTC, valued at $3.18 billion. This staggering amount positions the criminal among the 1,000 richest people globally, comparable to figures like basketball legend Michael Jordan, according to Forbes billionaires.
The Mt. Gox hack unfolded in June 2011 when hackers exploited vulnerabilities in the exchange’s security system. Using stolen credentials of Mt. Gox auditor Auden McKernan, the bad actor manipulated account balances through a fake account. This scheme involved displaying Bitcoin for sale, causing the cryptocurrency’s price to artificially plummet to one cent per bitcoin.
The hacker took advantage of the deflated prices, purchasing Bitcoin and later laundering them on BTC-e. Mt. Gox faced criticism for its weak security protocols, leading to promises of system improvements and reimbursements for affected users.
This historical event continues to cast a shadow over Bitcoin investors and the wider cryptocurrency market, with concerns about a potential sell-off by the Mt. Gox hacker and the repayment process for victims and creditors.
