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MT. Gox and CoinLab team up for US Bitcoin push; Silicon Valley Bank onboard

28 February 2013  |  6692 views  |  0 buy and sell button

The world's biggest Bitcoin exchange, MT. Gox, has inked a deal that will see Silicon Valley-based CoinLab handle its North American operations.

Despite its global dominance of the market, Japan-based MT. Gox has struggled to gain real traction in the US, prompting it to outsource operations to CoinLab.

CoinLab has gained credibility through a recent $500,000 funding round and also has a relationship with Silicon Valley Bank, which will provide "back-end banking features" for the exchange, says CEO Peter Vessenes.

"We'll be using an in-house key generation process for Bitcoins, combined with real (and realistic) physical controls for Bitcoins and cash," he adds in a statement.

Gox customers in the US and Canada, don't have to do anything, and will be notified when their funds have moved over to America, "and from then on, sending and receiving money in and out of the exchange will get a lot easier".

Although MT. Gox was hacked in 2011, causing a spectacular market crash, Vessenes says that he decided to work with the exchange after visiting Japan and determining that it has "by far the best security record" of potential partners.

That hack saw the value of Bitcoin fall from $17.5 to pennies on MT. Gox within minutes but the currency has been doggedly recovering ever since and hit a record high of more than $32 this week.

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