Bitcoin CEO pleads not guilty to embezzlement - 12th July 2017

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The CEO of a Bitcoin exchange which lost millions of dollars worth of the cryptocurrency has pleaded not guilty to charges relating to the loss.

Mark Karpeles, a 32-year-old French national, was answering charges of embezzlement and data manipulation at the Tokyo District Court.

In court in Tokyo, the CEO's defence explained that a transfer of just over 2 million ($A3.4 million) from an account which managed customers' funds to an external account was not embezzlement, but a legitimate transfer based on the company's revenue.

Karpeles is also alleged to have illegitimately increased the value of bitcoin in an account on Mt. Gox under his own name.

He told the court in Japanese: 'I swear to God that I am innocent.'

Karpeles founded and operated the bitcoin exchange Mt. Gox between 2010 and 2014, during which time the cryptocurrency exploded in value and his exchange handled up to 70% of the world's bitcoin.

Although it had been one of the earliest exchanges allowing people to buy, sell, and store bitcoin, Mt. Gox collapsed in 2014 when it filed for bankruptcy following the company's announcement that it suffered an enormous theft of 850,000 bitcoins.

The total value of the lost Bitcoin was at that time 387 million ($A650 million). The company said it had also lost 21 million ($A35.3 million) in cash from its Japanese bank accounts.

Karpeles initially blamed hackers for the stolen bitcoin, but Mt. Gox's users responded with allegations of impropriety.

The company subsequently found 200,000 of the missing units of the cryptocurrency.

The case continues.