Mt. Gox was once the world's largest Bitcoin exchange, handling over 70%
of all Bitcoin transactions worldwide. However, in February 2014, it
filed for bankruptcy, claiming that hackers had exploited a security
flaw in its system, resulting in the loss of 850,000 bitcoins, both
belonging to the exchange and its customers. At the time, these bitcoins
were valued at approximately $450 million.

Investigations later
revealed that the loss of bitcoins was due to a combination of hacking
and internal mismanagement. The exchange had allegedly been experiencing
issues for some time, including technical problems and regulatory
challenges. The collapse of Mt. Gox sent shockwaves through the
cryptocurrency community, leading to increased scrutiny of exchanges and
a push for greater security measures.

The aftermath of the Mt.
Gox collapse saw lawsuits, investigations, and attempts by creditors to
recover their funds. Mt. Gox's CEO, Mark Karpeles, faced legal
proceedings in Japan and was eventually found guilty of tampering with
financial records but was acquitted of embezzlement charges. The
incident remains one of the most significant events in the history of
cryptocurrencies, highlighting the risks associated with centralized
exchanges and the importance of security measures in the digital asset
space.