This is only half true. From Wikipedia [1], the name did originally stand for Magic The Gathering Online eXchange, but the domain was only used for that purpose for a couple months in 2007.

When it launched as a Bitcoin exchange in 2010, the unused domain was "Mt. Gox" from the beginning.

[1]: https://en.m.wikipedia.org/wiki/Mt._Gox#Founding_(2006%E2%80...