Ex-Mt. Gox CEO Unveils New Bitcoin-Related Business

Mark Karpelès, the former CEO of the now-defunct Mt. Gox cryptocurrency exchange, has re-entered the Bitcoin space with a new venture named EllipX. Karpelès announced this development today via a post on X, unveiling the EllipX Wallet—a product aimed at transforming the security and accessibility of crypto management.

Karpelès New Bitcoin Venture

The first announcement regarding EllipX appeared on August 6 on X, with a post encouraging the crypto community to follow their progress. Today, Karpelès provided a deeper look into the company’s first product through a detailed blog post. The EllipX Wallet is described as a groundbreaking solution employing Multi-Party Computation (MPC) to enhance security by dividing a user’s private key across multiple custodians: the user, their device, and EllipX’s secure environment.

The wallet uses a threshold signature scheme (TSS), an advanced cryptographic method for managing digital signatures. This technology allows multiple parties to jointly sign transactions without exposing their entire private key, minimizing the risk of theft or loss. “This launch marks a significant step towards our mission to develop products that shape the future of crypto and make it accessible to everyone,” the EllipX blog stated.

EllipX Wallet is touted as the world’s first user-oriented MPC-based crypto mobile wallet, which stands out by eliminating the need for traditional seed phrases typically required for wallet recovery. The wallet will support Ethereum (ETH) at launch with plans to add Bitcoin (BTC), Bitcoin Cash (BCH), ERC-20 tokens, and other assets.

The wallet’s design allows users to manage various cryptocurrencies, send payments without transaction fees and securely interact with decentralized applications (dApps) through an upcoming in-app browser.

A significant aspect of EllipX Wallet is its focus on security. The wallet utilizes the hardware security of the user’s device, combined with biometric data, and EllipX’s own authentication technology to safeguard private keys. Karpelès emphasized the innovative approach via X, “With the goal of making crypto more accessible and safer, the first step comes with the EllipX Wallet, a MPC wallet that splits private keys in 3 parts between yourself, your device and EllipX.”

Community Reaction

This venture marks a pivotal return for Karpelès, whose career was marred by the collapse of Mt. Gox in 2014 after a massive hack led to the loss of 850,000 Bitcoins. The incident had far-reaching consequences on the global perception of crypto security.

In light of the catastrophic end of Mt. Gox, the community reactions were mixed. While many wished for much success with his business, there were also some critics. Users commented for example “Congrats Mark, but I hope the irony isn’t lost on you either 🙂 and “You got balls. I’ll give you that.”

Notably, Mark Karpelès played a central and controversial role in the demise of Mt. Gox, once the world’s largest bitcoin exchange with 70% of all Bitcoin transactions. Under his leadership, Mt. Gox suffered from multiple security breaches. Karpelès attributed the 2014 hack to a software flaw, though investigations suggested poor security practices and possible internal fraud.

In 2015, Karpelès was arrested in Japan on charges of embezzlement and data manipulation, leading to a trial where he was found guilty of falsifying financial records but received a suspended sentence. His role in the collapse of Mt. Gox is controversial, seen by some as a result of negligence.

At press time, BTC traded at $61,068.

Featured image from The Seatle Times, chart from TradingView.com