After watching the riveting and entertaining nearly two-hour film documentary Effortless French, about the rise and fall of Mt. Gox, the infamous Bitcoin exchange, there are two questions (one big, one small) that are never fully answered. (Full disclosure: I was interviewed for this film and appear in multiple scenes, but I did not see any rough cut or portion of the film until I was recently sent a screener.)
First, we still don’t have a complete understanding of exactly what happened at Mt. Gox. We probably never will. It’s clear that the exchange’s Tokyo-based now-ex-CEO Mark Karpelès doesn’t really seem to know what happened either. Nor, for that matter, does he seem to be emotionally affected by it in any way that was captured on film.
Launched as a Bitcoin exchange in 2010, Mt. Gox quickly became the world’s most popular place to trade. But by February 2014, the site pulled the plug and filed for bankruptcy. Mt. Gox blamed its huge losses on hackers who had pilfered 850,000 Bitcoins (now worth over $8 billion), taking advantage of a major security flaw. At the time, Karpelès became the most hated person in the Bitcoin world for letting it happen right under his nose.
As for my second question: the filmmakers never directly address the question of the title of the film, which is derived from the T-shirt that Karpelès bizarrely wore the day in 2015 that he was arrested in Tokyo. He also agreed to wear that same T-shirt during the entire time that he sat for interviews for the film. If the French filmmakers, Vincent Gonon and Xavier Sayanoff, ever asked him about the T-shirt, the scene never made the final cut of the film.
Normally, the English word “effortless” implies making something difficult look easy. But here, Gonon and Sayanoff, who are both fluent in the language, seem to suggest a different and more literal meaning of the word: that there was a lack of meaningful effort on the part of this one Frenchman.
As for speculator Bitcoiners who lost their money in the crash—too bad. That’s the price of gambling in the digital Wild West. Yes, Mt. Gox’s bankruptcy proceedings remain ongoing (see: mtgoxlegal.com), but no one knows what, if any, money will be recovered to its creditors, even though the Bitcoins are now worth a lot more than they were at the time.
By the end of Effortless French, Karpelès’ quiet and naïve humanity shines through—he admits it’s “well possible” that he has Asperger’s or is on the spectrum somehow. There’s an extended sequence in the final scene where he discloses that he has spent years mimicking the social cues of others. In short, I was left with the impression that Karpelès got way in over his head and oversaw the collapse of his company, but probably will come out more or less OK.
A trailer for Effortless French.
The film opens with Karpelès’ arrest on August 1, 2015—this is depicted in the film through a montage of news footage. (He was eventually released on bail in July 2016.) Within the first minute, there’s also footage of Karpelès in 2007 (well prior to his involvement in Mt. Gox) saying to the camera that he wants to “take over the world,” but he admits that he’s “probably not the only one.”
Then, we dive into Bitcoin‘s origin story, as told primarily by Jeffrey Tucker, a libertarian economist (and Bitcoin evangelist), The New York Times’ Nathaniel Popper, and Roger Ver (aka “Bitcoin Jesus”).
At about minute 15 of Effortless French, Karpelès himself is finally interviewed. Frankly, I was a bit surprised that he even agreed to appear, given that his legal case is still ongoing in Japan. For nearly the entire film, he appears seated at a wooden table in a strange space that looks like a cross between a cave and an interrogation room. At first, he briefly speaks in Japanese before switching to his native French. Karpelès then explains that, when he took over Mt. Gox in 2011, it only had about 2,000 to 3,000 customers, but that number skyrocketed to about a million within two years.
Astonishingly, Karpelès says that Mt. Gox wasn’t meant at all as a bank or a proto-Coinbase. Rather, it was simply a way for people to buy Bitcoins using bank transfers and then withdraw them. He didn’t intend for people to keep their Bitcoins there for any meaningful period of time, despite the fact that that’s exactly what people did.
The rise of Mt. Gox was in parallel to the rise of Silk Road, the underground (and also now-defunct) drug website. Karpelès admits that Mt. Gox “indirectly” benefited from Silk Road before casually noting that “a third to a half of transactions on Mt. Gox were linked to Silk Road.” Then his interview immediately cuts to a separate and direct shot of him, with an almost blank stare on his face, looking right at the camera, shrugging his shoulders.
Through coworkers, the Mt. Gox of that era is described as a place that grew fast but was only meaningfully controlled by one person. Karpelès himself…