Chief executive of bitcoin exchange Mt Gox sentenced by Japanese court

The former chief executive of defunct bitcoin exchange MT Gox has been sentenced to two-and-a-half years in jail by a Japanese court after being found of guilty of falsifying electronic records.

Mark Karpeles was on trial for a number of charges but was found innocent of the more serious allegations of embezzlement and aggravated breach of trust and is unlikely to go to prison with his sentence being suspended for four years.

Read more: Central banks warned over cryptocurrency risk

It brings a close to the saga around the world's previously biggest cryptocurrency exchange, which went bankrupt in 2014.

The exchange lost around 850,000 bitcoins from his accounts, which are worth $3.3bn at today's market value of $3,865.

The Tokyo District Court found Karpeles guilty of altering Mt Gox's records but did not find him guilty of the prosecutors main argument that he embezzled millions of dollars of customers money.

It was revealed that the French national had “the purpose of falsifying the company's paperwork” on 21 occasions as he increased the sum record in a US dollar account by $33.5m, but accepted it was plausible he intended to pay the money back.

Karpeles was not charged for the missing bitcoins, which he alleges were stolen by a hacker.

Read more: Most UK consumers unable to define cryptocurrency, City watchdog finds

Alexander Vinnik of Russia was indicted by a US court in 2017 for allegedly receiving funds from a hack on Mt Gox and laundering them from other exchanges.

It was a moment that signified cryptocurrency's vulnerability to hacking and saw the price drop before it spectacularly rose to almost $20,000 in 2017.