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Mt Gox withdraws from Bitcoin Foundation

CEO of major exchange resigns from board amid transaction glitches, falling prices

Bitcoin prices have fallen sharply since news of the transaction vulnerability.
Bitcoin prices have fallen sharply since news of the transaction vulnerability.

Digital currency bitcoin suffered another setback yesterday when Mark Karpeles, chief executive of Toyko-based bitcoin exchange Mt. Gox resigned on Sunday from the board of the Bitcoin Foundation, Reuters reported.

Karpeles' departure follows disclosures of cyber attacks on Bitcoin exchanges. The attacks exploited a flaw in the software that runs Bitcoin that allowed transactions to be corrupted.

Last summer Mt. Gox placed a halt on US-dollar withdrawals and said this month that the block would continue as it had detected "unusual activity".

Charles Shrem, another prominent member of the Bitcoin Foundation, resigned earlier this year after his arrest in connection with an alleged drug operation involving his bitcoin currency exchange.

Bitcoin prices have fallen sharply since news of the transaction vulnerability. The currency remains in doubt in the absence of a robust regulatory framework and suspicion by many financial organisations of money laundering using bitcoin.