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Embattled Bitcoin exchange Mt. Gox continues to crumble.

A Tokyo court has prohibited Mt. Gox from beginning civil rehabilitation procedures, forcing the exchange to file for liquidation, according to a statement from a court-appointed administrator.

“The Tokyo District Court recognized that it would be difficult for the company to carry out the civil rehabilitation proceedings and dismissed the application for the commencement of the civil rehabilitation proceedings,” attorney Nobuaki Kobayashi wrote in the statement.

The court may investigate Mt. Gox CEO Mark Karpelès for liability in the exchange’s collapse.

“It is expected that, if the bankruptcy proceedings commence, an investigation regarding the liability of the representative director of the company will be conducted as part of the bankruptcy proceedings.”

Tokyo-based Mt. Gox was once the world’s largest Bitcoin exchange, handling 70 percent of all Bitcoin transactions by 2013. But marred by bugs and regular shutdowns, the exchange slowly became less popular among Bitcoin traders and evangelists — then a massive February hack changed everything.

The firm lost 850,000 Bitcoins (worth roughly $454 million today) and had another $63 million in debt. It quickly filed for bankruptcy protection.

Mt. Gox has since recovered 200,000 Bitcoins, but its future prospects remain bleak — as do those of the company’s 127,000 creditors. If the Tokyo District Court approves Mt. Gox’s liquidation application, a trustee will take control of the exchange’s remaining assets. In that likely circumstance, it may be more difficult for creditors to obtain their lost Bitcoins than if Mt. Gox was still operating.

There is still a chance that Mt. Gox will consider a buyout offer from investors. But “at this time, there are no prospects for the restart of the business,” a Mt. Gox representative said in a statement.

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