The last time I saw Mark Karpeles, the 33-year-old former CEO of Mt. Gox, he was baking apple quiche. It was July 2015, and we were in his cluttered apartment in Tokyo, as his pudgy orange cat, Tibanne, nuzzled at his feet. Oh, and he also had a giant toy train on a makeshift table in the middle of his living room. I was on assignment for Rolling Stone to profile Karpeles, who had become the biggest enigma in bitcoin outside of its mysterious creator, Satoshi Nakamoto. For a time, Karpeles was even suspected of being Nakamoto himself, along with Dread Pirate Roberts, the founder of notorious dark web marketplace Silk Road.



Karpeles today is perhaps the most hated man in the short history of bitcoin. Founded in 2010, Mt. Gox (named for its previous incarnation as a card game trading site, the Magic The Gathering Online Exchange) was processing 70 percent of all bitcoin transactions by 2013, making it the world’s biggest crypto exchange. Then, after a hacking attack that sent shockwaves throughout the nascent bitcoin industry and culture, it became the Towering Inferno of cryptocurrency. In all, it lost more than 850,000 bitcoins, worth about $500 million at the time. Last July, U.S. federal prosecutors charged 38-year-old Russian computer engineer Alexander Vinnik with laundering 530,000 stolen Mt. Gox bitcoin. But Karpeles, an elusive, French, anime fanboy who goes by the online nickname MagicalTux, remains the Keyser Soze cipher at the center of it all. Some think he’s an evil genius who absconded with the loot. Others see him as a rube who mismanaged one of the biggest goldmines in recent memory.



Karpeles is now out on bail after pleading not guilty to embezzlement and data manipulation at Mt. Gox, and spending 11 months in prison. He’s awaiting a new trial, which is not set yet, and faces an additional term of up to 15 years in prison. With Mt. Gox in bankruptcy, its creditors have begun filing claims to get their money back (the deadline is October 22). Concerns are mounting that the Mt. Gox payouts could, as former Mt. Gox trader Kim Nilsson told the Telegraph recently, “completely crash the market” if creditors liquidate their holdings all at once. Karpeles is also grappling with a class action case filed in Illinois by two Mt. Gox customers who hold him liable for their losses due to criminal conversion, negligence, and fraud. Karpeles filed a motion to dismiss the class action.



I caught up with Karpeles by phone last week while he was in Tokyo working for London Trust Media, a crypto investment firm. Due to death threats, he has been apartment hopping and hasn’t been making much quiche. “I don’t have much time, actually,” he tells me in his thick French accent, “my spare time is something that’s quite difficult to come by lately.” The following interview has been condensed and edited for clarity.

There will be more activity around me, so I probably need to be more careful.

Why do you keep moving apartments? Are you afraid for your safety?

I’m about to reach the point with my trial when it will be my turn to speak. So it’s likely there will be more activity around me, so I probably need to be more careful. Until this case reaches completion, I’m just keeping this process [of moving about].



Do you think you’ll be found guilty of embezzlement and data manipulation?

I still think so, yes. I declared at the beginning of the trial I am innocent of the charges brought against me. But the fact is I’m fighting an uphill battle because in Japan there’s a lot of cases like this ending with conviction. Something like 99%.



Are you afraid to go back to prison?

Of course, I don’t want to go to jail.



How did you spend your time in prison the first time?

I did quite a few things, like finishing learning Japanese. I didn’t spend a lot of time on many computers. I read a lot of legal documents related to my case.



You read up on bankruptcy law, among other things. What’s your sense of how Mt. Gox’s bankruptcy will play out?

This bankruptcy is very complex. There are many creditors, and they are all over the world. The other issue is that the assets of this bankruptcy are highly volatile. We’re talking about bitcoin and Bitcoin Cash, and possibly others. In the course of the bankruptcy, the assets potentially have higher value than the liability of the bankruptcy. In this specific case, it was not just a matter of there being slightly more than the liabilities, but multiple times more. Mt. Gox doesn’t owe me anything, so I believe the best course of action is for everything to be distributed to creditors.



What if you don’t succeed at dismissing the class action? Do you have a plan?

Well, I’m in bankruptcy anyway. There isn’t much I can do at this point. I don’t know anyway how it’s going to move forward, so if it comes to that I will decide at that time what to do.



Do you feel responsible for the hack?

I do feel responsibility in what happened. I would sleep better if Mt. Gox gives everything to creditors rather than shareholders.



Is there any way it could have been prevented? What could you have done differently?

Thinking afterwards, there’s a lot of things that can be seen. I would say that Mt. Gox’s main issue was being understaffed. It was difficult at the time to find the right people, especially when the business was multiplying [tenfold] per year.



What could you have done differently that might have prevented this?

Finding more staff, even if that could have raised the risk. Because hiring staff means you need to keep the staff around, be responsible for their salaries, and so on, for years to come. The main reason why I didn’t do that with Mt. Gox is because it was difficult at the time to say how bitcoin would grow.



Did you anticipate the value that bitcoin would have a few years later?

I thought bitcoin had huge potential and I would have guessed the business could grow maybe three, four times a year. But I didn’t expect it to reach ten times growth per year. I don’t think anyone would have at the time.



How bullish are you on bitcoin now?

We’re actually seeing a reduction in the use of bitcoin as a payment method. It’s difficult to use as a payment method because of its volatility. When you quote a price to someone, you’re not sure the amount will have the same value the next day.



When was the last time that you used bitcoin yourself?

I would say sometime before Mt. Gox’s bankruptcy—more than four years ago.



Are you currently using other forms of cryptocurrency?

Not at the time.



Why not?

Well there’s different reasons about this. Well, I guess the main one would be that it would potentially reflect poorly on the ongoing processes.



Where do you see cryptocurrency in five years, say?

One thing that may help is to see something a bridge between US dollars and cryptocurrencies—what people call a stablecoin. The Winklevoss brothers announced one recently. It’s something that fits between bitcoin and regular currencies. There could be quite an interest in those. t could help the technology to move in the right direction.



Have you spoken with the Winkelvosses? Because they were very active on Mt. Gox.

Not since the Mt. Gox bankruptcy.



Did you have any interaction with Alexander Vinnik? Did you have any idea that he was using the service?

Not at the time, no. I mean, he may have emailed customer support and asked questions at the time because he was a Mt. Gox customer, I believe. But I do not think I ever talked to him directly, even by email.



So what was your reaction when you heard that about him, and what was your response?

Not knowing what happened with Mt. Gox was very difficult for me, so finally seeing some of the facts come out about Vinnik, I believe, was a good thing for me and a good for thing for everyone affected by this case. But I believe I was too far from knowing everything. If he enters the U.S., it’s likely a trial will happen, and we may be able to access court records of events, which will bring more light on what happened.



Did you have a sense of how much of activity on Mt. Gox was coming from Russia?

I believe we had quite a lot of Russian customers. Maybe 10, 15 percent.



Do you have a sense of how bitcoin was being used in the criminal underworld in Russia?

Well, of course, not completely. There was the arrest of Ross Ulbricht, and the whole Silk Road case, which brought a lot of information about what happened in the underworld. But obviously, we didn’t know about the bitcoin being used for buying drugs. Quite a lot of people are doing this, but we didn’t have any information until all of this came out later.



Do you think about Ulbricht’s life sentence is fair?

I think it’s a very polarizing issue. I understand the legal system wanted to make an example of him. Since he was the first one to be convicted of this specific kind of crime, they wanted to scare other people from doing the same thing. At the same time, I only had a partial view of this case. I don’t have enough information to say if his sentence is fair or not fair.



What are your goals for the future?

I see a lot of technology challenges that I’d like to have the opportunity to work on. I don’t think it’d be a good idea for me to go into the cryptocurrency scene, but I may be able to help avoid something similar to what happened at Mt. Gox.

Russians criminals, and some Japanese. We also had some people who tried to deposit one million dollars in cash.

You mean by working in some form of security?

Not working in some form of security, but maybe acting as an advisor or releasing more information about what happened at the time.



How much more to the Mt. Gox story is yet to come out?

I’d say a third of the important information is not releasable yet.

Because people don’t know it or you’re not able to talk about it yet?

Some is just not releasable because there are ongoing investigations or legal cases.



How surprising will that information be when people find out? Will it affect their understanding of Mt, Gox?

There are some parts even I don’t know about. I was a little bit surprised when Vinnik was arrested, mostly because it sounded a lot like a spy movie. I just know exactly what will come next. I’m still wondering why part of the Vinnik indictment was redacted.

When you were at Mt. Gox, were you approached by Russian criminals?

Actually, quite a lot. Russians criminals, and some Japanese. We also had some people who tried to deposit one million dollars in cash.



What people tried to do that?

It’s probably better if I don’t say much more about those guys. But there were lots of very, well, unique people, the kind of people I never met before. People I probably will never meet again. I think it’s a good idea to not meet those people again.



Did you feel like you were in danger at the time?

Well, usually not too much, because within the office we had some basic security. But some people tried to organize things outside of the office, which really sounded bonkers.



What do you mean?

Well, for example, this person with this one million dollars wanted to meet in a separate town to pay this cash. That sounded very much like a bad idea.

At least someone is happy for my return. pic.twitter.com/PZmH30RwbI — Mark Karpelès (@MagicalTux) July 16, 2016

So you didn’t go?

Of course I didn’t go. I mean, receiving this amount in cash would be a violation of rules. And I’m pretty sure it would not have ended up nicely.



What do you think is the biggest misperception about you?

I don’t really know where to start. Lots of people think I play [the card trading game] Magic: The Gathering, which I don’t. There’s other misconceptions on how security was done at Mt. Gox at the time. But I’m not sure I can comment on this.



How’s Tibanne [the cat]?

So-so. He’s not so young anymore. We’re having trouble with his knees. It’s quite common with cats once they get certain age. Right now, I’m doing daily injections with medication I got from the hospital.



Do your friends stand by you or not support you?

I never had too many friends, but I’m happy to report that most everyone I know is still around. There are some people I cannot get in touch with, because of the bad conditions, but I still mostly feel good.