I don't think the insolvency explanation holds any water. Even if they have less money than their all deposits are worth, they still have huge amounts of BTC and fiat. And there's no way their day-to-day operations would lose money. They're actually still making a lot of money from the trading fees. And they would make even more money if they'd be wise enough to fix their buggy software.

On the other hand, I do not trust their (or actually, Mark's) overall technical or business competence at all.