Mt. Gox bitcoin exchange to liquidate after bankruptcy protection rejected

The Mt. Gox bitcoin exchange in Tokyo is heading for liquidation after a court rejected its bankruptcy protection application.

Mt. Gox said yesterday the Tokyo District Court decided the company, which was a trading platform and storehouse for the bitcoin virtual currency, would not be able to resurrect itself under a business rehabilitation process filed for in February.

An administrator will try to sell the company's assets, and many creditors, including those who had bitcoins with the exchange, are unlikely to get any money back.

CEO Mark Karpeles was also likely to be investigated for liability in the collapse of the Tokyo-based firm, the provisional administrator, lawyer Nobuaki Kobayashi, said.

After Mt. Gox went offline in February, Karpeles said 850,000 bitcoins worth several hundred million dollars were unaccounted for, blaming a weakness in the exchange's systems.

Later, Mt. Gox found 200,000 of the bitcoins, changing the estimate for the lost virtual currency to 650,000 bitcoins, although the exact amount is still under investigation.

Mt Gox. has suggested the bitcoins were stolen.