According to a major Japanese newspaper, Yomiuri Shimbun, an internal system manipulation is almost entirely responsible for the loss of 650,000 coins from Mt Gox.This is a complete contradiction to previous suspicions and assumptions of an outside attack.The newspaper cited an unnamed source that is related to the in progress police investigation on the missing coins, which claimed that only 7,000 coins out of the 650,000 displaced ones has been lost as a result of hacking attacks from external entities (outside the company).Besides this New Year’s Day edition report, there was no further explanation by Yomiuri on this subject.
The rumours of an inside job have long been circulating in the Bitcoin community.With that being said, there has been no concrete evidence to back up these rumours, and no one has been officially named as a suspect in this regard.CEO Mark Karpeles was the only full time worker at Mt Gox.Several contractors were continually employed for temporary time periods. This however has not pushed anyone to suggest that Karepeles masterminded the displacement of 650,000 coins.
The company’s take on the matter is that it was a gradual theft for which the transaction malleability flaw in Bitcoin’s underlying code is to be blamed.This belief is in sharp contrast with inside job theory. Not surprisingly, this claim was scoffed by Bitcoin core developer Gavin Andresen and other independent researchers.Mt Gox started to use the transaction malleability line in February of 2014.
This was quite some time before the extent of the damage had become entirely evident.At the time, Mt Gox announced that withdrawals would resume as early as possible.As far as impropriety with the Mt Gox trading system goes, the leaked transaction data showing anomalous behaviour on March 2014 ranks right up there.This anomalous behaviour was attributed to two automated trading bots that went by the name Willy and Markus.
The Yomiuri report labels these as suspicious accounts and has connects them with the missing coins.Towards the end of 2013, the Willy Bot would appear at certain times under multiple User Ids. These Ids had irregularities in their records such as unknown user locations.Every time it resurfaced with a new user ID, it would spent around $2.5 in buying bitcoin at the existing market rate of the time, and then put an abrupt end to the trading.This could be a factor behind the rise of bitcoin’s in November 2013Markus was there before Willy, and it operated by buying bitcoins at arbitrary prices.
It would never spend any real fiat money on the trade.Together, the two bots collected about 570,000 BTC as of the reports of November 2013. Since then, no records have been made available to the public.If we consider that the automated activity was still in order after November 2013 and until the attack on Gox two months later, the theory of the two bots being responsible for the disappearance of the 650,000 BTC seems quite plausible.The ongoing investigations should provide more answers to this question in the coming months, but as CEO Mark Karpeles was the only full time worker at Mt Gox, suspicions should certainly rise over his head.
