Forrmer Mt. Gox CEO Mark Karpeles aims to launch his new crypto exchange later this month with a focus on transparency and user-friendliness, the crypto entrepreneur told The Block in an interview on Wednesday at the Korea Blockchain Week event in Seoul, South Korea.
The upcoming platform, named EllipX, plans to launch in Europe later this month with its base in Poland. “Mt. Gox was based in Poland, so I do know it [well] as a country,” Karpeles said, adding that the new exchange is currently working to be compliant with MiCA. Karpeles will oversee the technical aspects of EllipX as its chief technology officer.
New venture
The former Mt. Gox head said EllipX will focus on ensuring transparency for consumers, especially newcomers in crypto. “If you look at the top 100 exchanges, the first few ones would be very large ones like Binance, Coinbase … But as you go down the list after five, six names, you won’t even know which companies are running the exchanges,” said Karpeles.
To guarantee transparency on the platform, Karpeles plans to compartmentalize different working bodies of the trading platform. “Because typically, an exchange today is doing both the broker side dealing with customers, and the matching side and the storage side, storing crypto and fiat,” said Karpeles.
The new exchange will have a structure similar to that of the New York Stock Exchange, but for crypto, Karpeles said. “Basically what I see for the future is to have one entity that deals with the trading on the market, and brokers located in different countries providing localized service, while the trading entity will only deal with trading,” Karpeles added. “The actual movement of hands on crypto will happen through clearing houses, basically companies like BitGo, that would still be separated from brokers.”
As crypto investors increasingly prioritize transparency, most major cryptocurrency exchanges claim to offer full transparency and security measures. This became even more critical following the case of the collapsed FTX exchange, where users entrusted billions of dollars without knowing the unlawful transactions done behind closed doors by its executives.
To the rightfully skeptical crypto investors, Karpeles said the exchange intends to share technical data with customers to show full transparency, on top of audits on each separate entity by third parties.
“So by creating this kind of transparency and this kind of environment, other exchanges are hopefully likely to follow,” said Karpeles. “Then transparency will become standard across the industry.” Karpeles added that his strive for transparency was heavily influenced by his experience with Mt. Gox, the hack and a decade of work leading to the repayment of funds.
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In a bid to outpace existing trading giants in the crypto exchange market, the former Mt. Gox CEO told The Block that EllipX will use user-friendliness as its weapon, mainly with the EllipX Wallet that was introduced last month. Equipped with multi-party computation technology, the EllipX wallet is said to be easier to use, with no need to write down phrases on a piece of paper, according to Karpeles.
As part of his crypto comeback, Karpeles is also preparing the launch of Ungox, a non-profit organization that will offer a rating system on crypto projects and exchanges.
Mt. Gox afterthoughts
In his recent X post, Karpeles said that Mt. Gox NFT owners will get special discounts on trading fees on his new trading platform, while all Mt. Gox customers from 2010 to 2014 are eligible to receive the NFT for free.
Established in 2010, Mt. Gox operated the largest bitcoin exchange in the world until the platform suffered a major security breach in 2014, resulting in the loss of at least 850,000 BTC. After a decade of working with creditors and a trustee, Mt. Gox started its repayment of funds earlier this year.
“Some are actually quite happy because it's been ten years. Of course, everyone wasn’t happy about what happened to Mt. Gox, but as bitcoin’s value increased so much, for many people, it means a lot of profits,” Karpeles said.
The former Mt. Gox leader said he is pleased to witness the growth of blockchain technology, security measures and regulations put in place since Mt. Gox’s bankruptcy. “Today, I don't think the security breach would have happened. And even if something similar happened and bitcoin was stolen, we would have noticed immediately,” he added.
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