Cryptsy CEO Denies He Moved Millions Of Dollars In Funds From Service

Paul Vernon, chief executive of now-defunct digital currency exchange Cryptsy, is denying allegations he took millions of dollars in funds from the service and moved it to his personal accounts.

According to a report by CoinDesk, Vernon said statements issued by a court-appointed receiver earlier in August were misleading, and the money movements were due to a mingling of business and personal accounts. “This is an interpretation by the plaintiff with the sole purpose of strengthening their case,” said Vernon in the report. “Were there business mistakes made during the course of Cryptsy’s operations? Of course, every business makes mistakes. One mistake that was made, which is a common mistake in small business, is mixing personal and business accounts.”

According to the report, Cryptsy shuttered its doors earlier this year, citing a hack in 2014 that the company claims left it with no money and millions of dollars in liabilities. The report noted the digital currency exchange operator also faced growing complaints for months about withdrawals. While Vernon would not address some of the allegations put forth by the court-appointed receiver, including claims that the CEO deleted information from Cryptsy’s servers before the receiver took possession of the company’s assets, he did claim the receiver intentionally ignored information that could have helped his case and denied claims the exchange improperly handled funds that were in alternative digital currencies. “I do not know why the receiver, who is supposed to be neutral, is cherry-picking information that only benefits the plaintiff,” Vernon said in the report.

While it’s unclear what really happened at Cryptsy, there are recent cases of hackers infiltrating an exchange. This summer, Bitfinex, a Hong Kong-based bitcoin exchange, was hacked, with bad guys making off with $65 million of the virtual currency. The hack resulted in a plummeting in the price of bitcoin and Bitfinex putting all trading and deposits on hold while it investigated it. The exchange is operational again.