cryptopolitan.com
Bitforex, a prominent crypto exchange based in Hong Kong, has come under scrutiny as it abruptly halts withdrawals for its users, leaving them in a state of uncertainty. The exchange’s actions have sparked concerns among its user base, with many reporting issues ranging from difficulties accessing their accounts to a lack of responsiveness from the company.
Bitforex suspension of withdrawals saises alarms
Bitforex’s decision to suspend withdrawals without prior warning has left its users stranded, unable to access their funds for at least three days. The exchange’s X account has not seen any updates since May 2023, adding to the growing apprehension among customers.
Seeing some suspicious activity with the crypto exchange @bitforexcom.
— ZachXBT (@zachxbt) February 26, 2024
On Feb 23 their hot wallets saw outflows of ~$56.5M. Shortly after this time withdrawals stopped processing with no official announcements having been made since.
Currently users are asking questions on… pic.twitter.com/gFEcwExHKh
On Bitforex’s official Telegram channel, users have been vocal about encountering problems with their accounts, including the inability to log in and the dashboard failing to display their assets. Furthermore, some users have reported being blocked from accessing the company’s website altogether, compounding the frustration and distrust among the community.
Lingering concerns amidst operational challenges
While certain sections of Bitforex’s website remain accessible, such as an announcement revealing the departure of former CEO Jason Luo, the lack of updates and communication from the exchange has raised red flags.
This comes in the wake of Bitforex’s once-prominent position in the global crypto exchange landscape, with a daily trading volume of approximately $2.6 billion in crypto recorded in September 2023. However, CoinMarketCap currently does not provide live data on Bitforex, exacerbating concerns about the exchange’s operational status.
Regulatory scrutiny and past incidents
Bitforex’s troubles are not without precedent. In April 2023, Japan’s Financial Services Agency (FSA) accused the exchange of violating the nation’s fund settlement laws by operating in the country without proper registration.
Despite this, Bitforex managed to evade significant regulatory consequences or media attention since then.
The crypto industry has witnessed similar incidents in recent times, further highlighting the challenges faced by exchanges. Last week, Atom Asset Exchange (AAX), another Hong Kong-based exchange, made headlines after moving around $55.6 million worth of Ether from its wallets. AAX had ceased all operations on November 13, 2022, shortly after FTX filed for bankruptcy.
The former CEO and a board member of AAX were subsequently arrested by Hong Kong police in connection with the incident. Notably, the founder of AAX, whose identity remains undisclosed, is alleged to be evading authorities with millions of dollars belonging to users.