The leak of an internal MtGox document has revealed that the theft of nearly 750,000 ($377m) Bitcoins has left the exchange on the verge of bankruptcy.
A crisis strategy draft for MtGox explained that thieves have been exploiting a loophole in the site for years to steal Bitcoin, meaning that by the time the vulnerability was discovered and fixed, the damage had already been done.
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The strategy draft, leaked on the internet by Bitcoin blogger Ryan Galt, said: "At this point BTC744,408 are missing due to malleability-related theft which went unnoticed for several years.
"The cold storage has been wiped out due to a leak in the hot wallet.
"The reality is that MtGox can go bankrupt at any moment, and certainly deserves to as a company".
The company has now suspended trading altogether.
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By GlobalDataMtGox previously suspended withdrawals on the 7 February after reporting "unusual activity" on the platform.
Following MtGox’s decision to suspend Bitcoin trading, the digital currency’s values slumped from their mid-January high of $1,000 to about $540.
According to MtGox’s investigation into the "unusual activity", thieves were using a loophole to fool the transaction process into sending double the correct number of Bitcoins.
In a statement released by MtGox on 19 February the company explained that thanks to Blockchain.info it had managed to issue a unique identifier with each transaction.
MtGox announced that it would issue another update on the resume of Bitcoin trading by 20 February at latest, but the Tokyo-based company has not yet issued any update or resumed trading.
Six other Bitcoin exchanges, including BTC China and Coinbase have issued a statement distancing themselves from MtGox.
They said: "This tragic violation of the trust of users of MtGox was the result of one company’s actions and does not reflect the resilience or value of Bitcoin and the digital currency industry."
"As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today.
"We are confident, however, that strong Bitcoin companies, led by highly competent teams and backed by credible investors, will continue to thrive, and to fulfil the promise that Bitcoin offers as the future of payment in the internet age."
Meanwhile MtGox’s leaked strategy draft cast doubt on the future of Bitcoin as a whole.
"With Bitcoin/crypto just recently gaining acceptance in the public eye, the likely damage in public perception to this class of technology could put it back 5-10 years, and cause governments to react swiftly and harshly.
"At the risk of appearing hyperbolic, this could be the end of Bitcoin, at least for most of the public.
"This isn’t about saving MtGox anymore."
At the time of writing, Bitcoin value stands at $502 on Bitstamp, while it stood at $135 on MtGox shortly before trading was suspended.
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