Mark Karpeles (Bitcoin guy) keeps his name out on WSJ Real Time, but can’t say much.

That’s what I took away from this interview with the Wall Street Journal’s Japan focused blog.

What went wrong is that people invested in this man’s company, as “depositors”, and lost millions. Bitcoins were billed as an online currency, but in fact, were not a currency. In my view, this made the transaction more like investing in a security. But apparently, Mt. Gox never registered as a securities dealer in Japan—nor does Japan seem to have any interest in pursuing this matter as an illicit securities one. (Probably because most of the victims / creditors in bankruptcy were foreigners?)

“I can’t say much because it’s a police matter” doesn’t give me a lot of confidence that Karpeles is going to bounce back from this “no regrets because I learned a lot!” computer project. I think the local English-language media spin around Tokyo is trying to put a geeky face on an activity that should have been well-regulated from the start. That is, I don’t think that Japan would have allowed someone to come to Shibuya Ward and set up a bank, and just learn as they go along. They wouldn’t allow someone to pitch securities from a store front.

Again, it seems like another situation in Japan with foreigners and the computer. And since it involves foreigners and computers, it gets to have its own unique definitions and its own unique set of game rules.

I think there has to be a penalty for misfeasance. Otherwise, you get malfeasance.