The former head of MtGox faced fresh criminal charges on Friday over allegations he stole $2.6 million from clients, as police questioned him about hundreds of millions of dollars worth of missing Bitcoins.
Japanese authorities issued a fresh arrest warrant for Frenchman Mark Karpeles, over claims he stole millions from clients before the Bitcoin exchange collapsed, police told AFP.
He spent most of that money on buying software rights, but also splashed out about $48,000 for a luxury bed, local media said.
Karpeles, 30, who has reportedly denied the allegations, was initially taken into custody this month over the affair and has been held without formal charges for three weeks, as allowed under Japanese law.
With his time in custody set to end this week, a fresh arrest warrant would reset the clock on how long police can hold and grill the self-described computer geek over the missing money.
Karpeles was first taken into custody over claims he fraudulently tinkered with data and transferred funds to other firms controlled by him dozens of times between 2011 and 2013.
However, police are also reportedly interested in questioning Karpeles about the disappearance of 850,000 coins last year, valued at around $480 million then and $387 million at current exchange rates.
Tokyo-based MtGox froze withdrawals in early 2014 and was later shuttered over the missing money, which it said was linked to a bug in the software underpinning Bitcoins that allowed hackers to pilfer them.
The exchange -- which once boasted it handled around 80 percent of global Bitcoin transactions -- filed for bankruptcy protection soon after the cyber-money went missing.
Karpeles later said he had found some 200,000 of the lost Bitcoins in a "cold wallet" -- a storage device, such as a memory stick, that is not connected to other computers.
Investors have demanded answers from Karpeles and called on the firm's court-appointed administrators to make its data public so that experts around the world can help analyse what happened at MtGox.
But the complex case has presented a big challenge to Japanese police, as financial watchdogs around the world struggle to work out how to regulate digital money.
In response to Karpeles' initial arrest, Tokyo said it would boost efforts to regulate the crypto-currency in coordination with other G7 countries.
Bitcoins are generated by complex chains of interactions among a huge network of computers around the planet, and are not backed by any government or central bank, unlike traditional currencies.
Backers say digital currencies allow for an efficient and anonymous way to store and transfer funds online. But critics argue the lack of legal framework governing the currency, the opaque way it is traded and its volatility make it dangerous.