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    Assets of US Bitcoin affiliate frozen

    CHICAGO — Mt. Gox Inc., the American affiliate of the bankrupt Bitcoin exchange that lost track of hundreds of millions of dollars’ worth of virtual currency, had its US assets frozen by a federal judge in Chicago.

    District Judge Gary Feinerman Tuesday issued a temporary order tying up money and property belonging to the affiliate, its corporate parent, Tibanne KK, and principal Mark Karpeles.

    He issued that order without opposition from Tibanne or Karpeles, who were not represented in court, and in the presence of lawyers for the parent, Tokyo-based Mt. Gox Co., which filed for bankruptcy in Japan last month. Feinerman’s order doesn’t cover the bankrupt entity and expires on March 25.


    Once the world’s biggest Bitcoin exchange, Mt. Gox Co. said in a US court filing that almost 750,000 customer Bitcoins and 100,000 of its own, about 7 percent of all Bitcoins in existence worldwide, were missing and probably stolen.

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    Almost at the same time it was filing for bankruptcy in Tokyo last month, the company, its affiliates, and Karpeles were being sued in the United States by Gregory Greene of Skokie, Ill., a depositor claiming he had lost access to about $25,000 worth of currency.

    Suing on behalf of the businesses’ US customers, he accused the companies and Karpeles of misappropriation and fraud.

    The parent company has also sought protection from creditors in the United States and has obtained an order from US Bankruptcy Judge Harlin Hale in Dallas shielding it from litigation.

    Hale declined to extend that protection to the other defendants sued by Greene, which Feinerman took into account when he approved the asset freeze. Feinerman said Greene established a ‘‘sufficient likelihood of success’’ on his claims to warrant the freeze but warned that there may be no assets left.

    Bloomberg News