Mt. Gox Ex-CEO Wants Bitcoin’s Rules Rewritten To Claw Back $5B In Stolen Coins

Twelve years is a long time to wait. For thousands of people who lost their Bitcoin when the Mt. Gox exchange collapsed in 2014, the wait has stretched on with little hope of getting everything back.

Now, the man who ran the exchange is pushing for an extraordinary solution — one that would require changing Bitcoin itself.

A Proposal That Shakes Bitcoin’s Foundation

Mark Karpelès, Mt. Gox’s former boss, submitted a formal proposal on GitHub last Friday calling for a hard fork — a fundamental change to Bitcoin’s rules — that would allow nearly 80,000 Bitcoin, currently worth more than $5 billion, to be moved to a recovery address without needing the original private key.

Reports say those coins have not budged from a single wallet in over 15 years, making them one of the most-watched and well-documented addresses in all of crypto.

Karpelès was blunt about what he was asking for. He did not try to soften or disguise the idea. “This is a hard fork,” he reportedly wrote in the proposal. “It makes a previously invalid transaction valid.”

His reasoning centers on a deadlock that has developed between two key parties. The Mt. Gox trustee overseeing creditor repayments has refused to pursue any on-chain recovery without some guarantee that the Bitcoin community would actually adopt such a rule change.

But the community cannot seriously weigh that idea without a concrete proposal in front of them. Karpelès says his GitHub submission breaks that stalemate.

Critics Say It Opens A Dangerous Door

The pushback came fast. On the Bitcoin forum Bitcointalk, members lined up to argue the proposal would cause serious damage to one of Bitcoin’s most important qualities — the idea that transactions, once confirmed, are permanent and cannot be reversed by anyone.

One user warned that approving a rule change like this would set a template for every future hack victim to demand the same treatment. Another raised concerns about outside governments gaining influence over what Bitcoin can and cannot do.

Those concerns are not unreasonable. Bitcoin’s value, at least in part, rests on the belief that no single person, court, or government can reach in and move coins without the proper key. Break that rule once, even for a sympathetic reason, and the rule is no longer a rule.

Mt. Gox was once enormous. At its height, it processed roughly 70% of all Bitcoin transactions happening anywhere in the world.

Hackers exposed weaknesses in its security systems as early as 2011, draining thousands of coins over time in a theft that went unnoticed for years.

By February 2014, the exchange filed for bankruptcy in Tokyo after reporting losses of 750,000 customer Bitcoin and 100,000 of its own — worth around $500 million at the time.

Featured image from Unsplash, chart from TradingView