My take on this is that they probably were insolvent for a long time already due to previous hacks/theft. The CEO just decided to lie about the supposedly 137M in funds 'safely' stored on his laptop.
This is also what happened at MtGox, except that at MtGox they 'lost' wel over a million BTC.
This is also what happened at MtGox, except that at MtGox they 'lost' wel over a million BTC.
Edit: relevant listening: https://darknetdiaries.com/episode/9/