MOSCOW, August 17 (RIA Novosti) - Virtual economy expert, American Jesse Powell, plans to open a new bitcoin exchange named Kraken to replace failed Mt. Gox in the next month reports Bloomberg.
"It was clear after that hack at Mt. Gox, when they were down for like a week, that the exchange is really the most critical piece of the ecosystem," said Powell as reported by Bloomberg. The exchange, located in Japan, is set to be a new alternative to the failed Mt. Gox.
Mt. Gox, once the largest Bitcoin exchange in the entire world, has since been shut down and liquidated after a series of high profile security breaches resulting in the loss of approximately 450 million dollars, according to their website and Powell's Blog.
Powell is a virtual currency pioneer. His original venture, Lewt, was an online trading house for virtual objects in online games such as World or Warcraft and Diablo. Powell was hired by Mt. Gox in June 2011 to run their daily operations. He stayed with the company until February 2013 when the company filed for bankruptcy, Bloomberg writes.
Kraken has and is facing many regulatory burdens and difficulties, mainly from the US Department of the Treasury. According to Bloomberg, guidance set by the Financial Crimes Enforcement Network in March 2013, “set [Kraken] back by half a year” said Powell and “made it difficult to get custodial bank accounts to hold customer funds, limiting the company’s U.S. services to five states.” Powell is now planning on establishing Kraken in Japan, where he says he was “really surprised how open-minded Japanese politicians are,” in comparison to the US which is still “in the Dark Ages.”
Bitcoin is still facing many hurdles before it will be a common currency. There are many companies which still believe in its capacity and expect it to eventually gain a large enough part of the global market share.
The price of a bitcoin this morning was $491 according to Coindesk, down from its December highs of $1151.
