Bitcoin (virtual currency)
The risks of cryptocurrencies are exposed as MintPal is rocked by the apparent theft of 3,700 bitcoins Reuters

Around 3,700 bitcoins have allegedly been stolen from the cryptocurrency exchange MintPal and are being held in a personal wallet belonging to the firm's former CEO Alex Green.

The true identity of Green was called into question last week, with some claiming that he was in fact known-scammer Ryan Kennedy. In response, Green has issued a statement admitting that he had legally changed his name from Ryan Kennedy in what he described as "an attempt to start my life over and have some peace".

It has been claimed by some within the cryptocurrency community that under the name of Ryan Kennedy, Green previously formed the company and subsequently stole investors funds.

"He claimed to have suffered a heart attack and received death threats, similar to the serious health problems and death threats Alex Green claimed to have experienced, and then disappeared," Jackson Palmer, creator of the digital currency dogecoin and long-time critic of Alex Green, said in a file released last week to expose Green's past.

"According to comments in a scam accusation thread on Bitcointalk, he was accused of taking over 500 BTC."

MintPal situation the equivalent of a 'nuclear bomb'

Under his new identity Green formed Moopay, the parent company of Moolah and MintPal, and has now announced that the company is entering liquidation following the passing of a winding-up resolution.

The latest claims that Green has stolen 3,700 bitcoins - equivalent to $1.4 million (£0.87m) - from MintPal customers and is keeping them in a personal wallet were raised by former Moopay employee Eoghan Hayes.

"What happened to MintPal is the equivalent of a nuclear bomb being dropped on a city, and a two-man hazard crew consisting of Mike and Ferdous (MintPal's primary shareholders) are now in charge of the clean up - and attempting to follow the trail of a 3,700BTC transaction from MintPal, which is now accused of being lodged into a personal account of Ryan Kennedy," Hayes said.

Palmer has described the MintPal debacle as "essentially the new MtGox", referring to the embattled Tokyo-based cryptocurrency exchange that collapsed earlier this year.

Ben Doernberg, former member of the Dogecoin Foundation, has echoed these sentiments, saying in a recent interview that Green appeared to be a pathological liar.

"I believe he is flailing wildly trying to avoid legal consequences for the many crimes he has been accused of committing," Doernberg told Cointelegraph.

MintPal fall-out

MintPal is no longer controlled by Green and the firm have issued several statements on Twitter to address the issue of the missing funds and to encourage customers to contact UK Action Fraud.

Green is yet to respond to a request for comment from IBTimes UK but has issued his own statement in a blogpost released by Moolah on Sunday.

Claims that funds have been stolen were not addressed, but a "giant technical oversight" was cited by Green for the reason Moopay had been "bleeding funds from the core platform".

"I do not believe I can ever apologise enough to customers of MintPal, investors in Moolah, third parties who trusted us, and the general digital currency community at large," Green said in a blogpost on Sunday.

"This situation should have never occurred, and I intend to never again take a position of leadership in a financial-related company of any kind.

"I do not expect that the general populace will believe anything I have said here, and as the sole director of Moopay, I fully intend to cooperate with any and all law enforcement and regulatory agencies as required.

"I am shocked and upset that this has happened, and I am fully aware that I deserve the general sentiment in relation to me. Again, words cannot express how sorry I am. I will be taking any and all possible action in order to mitigate the damage caused by this event, in turn likely caused by poor management by myself.

"And yes, I know sorry isn't good enough. I know I have f****d up on a catastrophic level. There should have been better procedures in place."