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OKEX Suspends Withdrawals Causing a Bitcoin and OKB Token Price Plunge

Leading Asian cryptocurrency exchange OKEx has caused a mild selling panic in the crypto markets after suddenly suspending its services to cooperate with an investigation. The suspension of services immediately stirred a reaction in the Bitcoin price which plunged 3% while OKB took a 15% hit.

According to an announcement by the major crypto exchange today, OkEx has suspended all cryptocurrency withdrawals as one of its private key holders is now cooperating with a public security firm in regard to an ongoing “investigation.”

Per the OKEx statement:

“One of our private key holders is currently cooperating with a public security bureau in investigations where required […] In order to act in the best interests of customers and deliver exceptional longtime customer service, we have decided to suspend digital assets/cryptocurrencies withdrawals as of [October 16, 2020 at 11:00 (Hong Kong Time)]. We assure that OKEx’s other functions remain normal and stable and the security of your assets at OKEx will not affected.”

OKEx serves many Chinese retail investors and is one of the three largest Chinese crypto exchanges along with Huobi and Binance.

The company’s CEO, Jay Hao addressed the withdrawal suspension on Weibo:

“Please be assured that the company, operation, and business are not impacted. It’s a matter of a private key holder’s personal issue, which is why we suspended withdrawal.”

The exchange has not been able to contact the private key-holder in question and claims to be unable to complete the associated authorization requests—OKEx assures the public that cryptocurrency withdrawals can resume as soon as the key-holder is able to authorize the transaction in question.

The Bitcoin (BTC) price has fallen nearly 3% following the news and OKEx’s own token OKB has crashed around 15%.

Is it Money Laundering?

While the information is largely unverified—a Beijing based reporter named Colin Wu has been following the event and tweeted:

“OTC merchant on OKEx had mistakenly received 500,000 CNY from the fraud group and was hunted by the police across the provinces.”

Wu also reported that the notice of the end of the withdrawal suspension fluctuates constantly between 12pm and 3pm. He further suggested that the events may be related to money laundering.

Wu wrote:

“The Chinese government is cracking down on money laundering using cryptocurrency for telecom fraud, and centralized exchanges are in a very dangerous state.”

More updates will come soon as more information on the OKEx suspension is revealed.

OKEx Founder Star Xu Arrested After Crypto Exchange Suspends Withdrawals

According to Caixin news, OKEx founder Mingxing ‘Star’ Xu has allegedly been arrested by police following the major crypto exchanges sudden suspension of its withdrawals as one of its private key holders was said to have been cooperating with a public security firm in regard to an ongoing “investigation.”

The news of leading Asian cryptocurrency exchange OKEx suddenly suspending its services to cooperate with an investigation drove the crypto markets into a panic—and it has now been reported that the person cooperating with authorities was the founder of the exchange Star Xu.

The suspension of services immediately stirred a reaction in the Bitcoin price which plunged 3% while OKB took a 15% hit.

The exchange reported at the time of the service suspension, that it had been unable a private key-holder in question and claimed to be unable to complete the associated authorization requests. The private key holder in question was Mingxing Xu, who has now been taken into police custody.

Two other sources close to OKEx told Caixin News, that they confirmed the key holder under investigation was Star Xu, OKEx’s founder, who was “cooperating with the investigation by the public security authorities” per the exchange announcement.

One of the sources also reported that Xu had been taken for questioning by authorities last week and did not appear at work for several days. The source described Xu as being very detail-oriented in financial expenditure management and it seems obvious to them that the delays were due to his inability to authorize the withdrawals as one of the main private key holders.

Ant Group's IPO Delay Bigger Concern for Asia Tech than US Election

Could the suspension of Ant Group’s $34.5 billion IPO have a greater impact on Asia’s FinTech ecosystem than the United States election?

Ant Group was meant to hold its record-breaking initial public offering (IPO) today, that was until the IPO was abruptly suspended after a meeting between Ant executives and the People’s Bank of China along with Chinese financial regulators, following some regulatory criticism from founder and China’s second-richest man Jack Ma.

A day after the meeting between Ant Executives and China’s financial watchdogs, the Shanghai Stock Exchange announced the suspension stating that Ant Group’s actual controller, chairman, and the general manager were being interviewed by regulators.

In addition, the exchange said that Ant Group’s reported changes in the regulatory environment of financial technology may cause the Ant Group to fail to meet the issuance and listing conditions or information disclosure requirements. Therefore, the Shanghai Stock Exchange has decided to suspend Ant Group’s listing.

According to a report from CNBC on Nov. 04, the CIO of Reyl Singapore, Daryl Liew believes the suspension of Ant Group’s initial public offering (IPO) in China and Hong Kong could have a far greater impact on Asian financial technology (FinTech) than the United States election results.

Global Trend Of FinTech Scrutiny

Liew is the Chief Investment Officer for Reyl Singapore and thinks that Ant Group’s IPO suspension could represent a rising global trend of increasing regulatory scrutiny of FinTech companies. Liew told CNBC that as a result of this trend, investors may begin to reevaluate the valuations of tech firms.

Ant Group is the parent company of Alipay, the largest payment platform in China. The company offers lending, credit scoring, and other financial related services. Unlike traditional financial institutions like banks, Ant Group has stressed the importance and adoption of technological innovations like blockchain, IoT, Database, AI, and Security technologies.

Regulators have been showing increasing interest in Ant Group’s operations. The head of consumer protection division and Chinese banking regulator, Guo Wuping recently said that the rights of users of Ant-owned consumer loan companies Huabei and Jiebei deserve close scrutiny.

Guo also said that a fintech like Ant Group could be seen as a technology-driven multi-purpose bank, and should therefore be under the same regulatory scrutiny as a bank.

China’s Problem Too

Liew told CNBC, that prior to this suspension most regulatory concerns appeared to be the problem of the United States, with FinTech giants in China appearing to have more government support, like Tencent and Jack Ma’s Alibaba.

Ant’s record-breaking IPO would have led the way for future Asian fintech public listings, and would have been a huge achievement for China’s technology sector.

Liew asked:

“Is this something that has thrown a huge spanner in the works — not just for Ant but for other tech companies?” he added, “The fact that the Chinese are also now looking into this is a concern.”

Another expert, Winston Ma, adjunct professor of law at New York University told CNBC that he believes:

“The increased scrutiny of internet lending is just the beginning, as more regulations such as the anti-trust and the personal data privacy protection are also coming to the picture […] In short, the age of (exponential) growth in the wilderness for internet finance is over — and that’s the reality the fintech investors have to embrace.”

Don’t Focus on US Election

Currently, no clear winner has emerged from the US presidential election and the race has become more a dogfight than the landslide Biden supporters were expecting.

While many in the markets have their eyes firmly on whether President Trump will serve another four years or if former Vice President Joe Biden will assume the oval office—Liew argues that investors should not be “overly concerned about who is going to be president.”

The head portfolio manager instead recommends that investors analyze the fundamentals and valuations of firms at this point, as there are too many moving parts in the election.

Binance Exchange Halts Major Crypto Services in Singapore

Binance, the biggest exchange in the world, has announced that with effect from October 26, the trading platform users in Singapore will not be able to access the most basic functions of the Binance.com platform.

Per the announcement shared, the services include fiat deposit services, spot trading of cryptocurrencies, the purchase of cryptocurrencies through fiat channels, and liquid swap or the known Regulated Payments Services.

Amongst the trading platforms operating in Singapore, Binance has been at the centre of attraction for the Monetary Authority of Singapore (MAS) in the past weeks. The market watchdog flagged the exchange for operating illegally, a move that forced Binance to halt payment services that feature the Singapore Dollar. The current action to suspend most of its benefits is geared at pacifying regulators while restoring trust to continue its business in the Asian nation.

Binance advises all traders to close all of their positions before the defined deadlined based on this premise.

“As the market leader, Binance constantly evaluates its product and service offerings. We will be restricting Singapore users regarding the Regulated Payments Services in line with our commitment to compliance. Users in Singapore are advised to cease all related trades, withdraw fiat assets and redeem tokens by Wednesday, 2021-10-26 04:00 AM UTC (Noon UTC+8) to avoid potential trading disputes,” the exchange’s announcement reads.

Binance struggles across several jurisdictions, including the Netherlands, South Africa, and Italy, appear compounding. However, Chief Executive Officer Changpeng Zhao (CZ) has reiterated the trading platform’s primary determination is to comply with local regulations in the coming months. While the move to suspend its services in Singapore signifies a show of responsibility by the firm, talks are notably ongoing with authorities intending to restore its operations, according to several media reports.

Nexo AG Says Interested in Acquiring Celcius Network's Remaining Qualifying Assets

Nexo AG has released a Letter of Intent showing its potential interest in the possible acquisition of certain assets of crypto firm Celcius Network LLC and Celsius Lending LLC.

In the letter, Nexo, a major cryptocurrency lending platform based in Switzerland, stated that the company, its partners and affiliates are interested in acquiring “certain remaining qualifying assets, mainly collateralized loan receivables secured by corresponding collateral assets, brand assets and customer database of the business”.

The proposal is a non-binding bid. The letter noted that the offer is valid until 4:30 a.m., UTC (Coordinated Universal Time) on Monday, June 20, unless accepted or rejected by the seller or withdrawn by the buyer before that time.

This comes following the crypto lending platform’s Monday announcement to pause all withdrawals and transfers between accounts due to extreme market conditions.

“In service of that commitment and to adhere to our risk management framework, we have activated a clause in our Terms of Use that will allow for this process to take place,” the official company blog reads.

Celcius has not replied to Nexo’s interest yet.

The platform, one of the biggest crypto lenders, said customers can continue to accrue rewards during the pause in line, reiterating that the network is “taking necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets,” the blog post added.

Reportedly, up to 50,000 Ethereum (ETH) and 3,500 Wrapped Bitcoin (WBTC) were being moved to an address located in FTX a few hours ago before the suspension, according to an alert citing King Data’s Etherscan. The transfer is worth around $63.64 million and $86.499 million respectively based on the current price.

The announcement has come during one of the many bumpy weekends in the crypto market. Crypto space was suffering from multiple bearish events recently, including the collapse of LUNA and UST events.

According to the latest announcement, the Celsius token (CEL) once tumbled 60% within an hour, reaching the bottom at $0.1554. It is now trading at around $0.1883 during the Asia trading section.

Furious sentiments are being shared among investors, some customers are blaming Celsius for having no response to the request of withdrawing tokens and questioning its reserve if it might result in bankruptcy.

Some market participants are now concerned about the ability of the firm, the New Jersey-based crypto lending platform, to meet its long-term debts and other financial obligations. Celsius is known in the past to have made its name by offering above-average interest rates on deposits.

According to Blockworks, Celsius was valued at $3.35 billion when it closed its “oversubscribed” Series B financing to $750 million last November. The company had processed $8.2 billion worth of loans and had $11.8 billion in assets, its website showed.

In April, Blockchain.News reported that the Network has stopped paying interests to unaccredited investors, meaning new retail investors are not able to earn interests by joining its program.

The network remains full of uncertainty ahead in recovering its price and winning confidence among investors.

-With the assistance from Nicholas Otieno-

Vauld Suspends Withdrawals, Exploring Restructuring amid Market Downturn

Vauld, a crypto lending and exchange firm headquartered in Singapore, announced on Monday that it has suspended withdrawals, trading, and deposits on its platform, citing the current “financial challenges”.

Vauld admitted that it is witnessing financial woes amid the ongoing market downturn, which it said prompted customers to withdraw about $198 million since June 12.

Darshan Bathija, the founder and CEO of Vauld, said that the company is exploring restructuring options and so far, has engaged Kroll, a New York-based corporate investigation and risk consulting firm, for financial advisory services, and has hired Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as legal advisors in India and Singapore respectively.

“We are confident that, with the advice of our financial and legal advisors, we will be able to reach a solution that will best protect the interests of Vauld’s customers and stakeholders,” said Bathijaand, adding that the firm will make specific arrangements for certain clients who need to meet their margin calls.

Vauld is a three-year-old crypto lending startup, which counts Peter Thiel-backed Valar Ventures, Coinbase Ventures, and Pantera Capital among its key backers. According to July last year, Vauld had raised a total of $27 million, from investors such as Peter Thiel’s Valar Ventures, Coinbase, Pantera Capital, and Cadenza Capital.

Vauld has been offering lending services and serving as an exchange. The platform enables clients to earn what it describes as the “industry’s highest interest rates on major cryptocurrencies.” On its website, Vauld claims to offer 12.68% annual yields on staking several stablecoins, including USDC and BUSD and 6.7% on Bitcoin and Ethereum tokens. The platform allows customers to borrow against their tokens and facilitates many other trading services.

Crisis in Crypto Lending Landscape

The announcement regarding Vauld’s suspension of customer withdrawals and trading comes after the lender laid off its employees by 30% one week ago.

The job cut came as a surprise. On June 16, Bathija assured Vauld customers that the platform had no exposure to prominent lending platform Celsius Network and high-profile crypto hedge fund firms Three Arrows Capital.

In recent weeks, crypto veterans, including Binance CEO Changpeng Zhao, have warned that many more DeFi platforms are in danger of collapsing amid the current market crash.

On 13th June, Crypto lending platform Celsius Network paused all withdrawals and transfers for customers as the firm faced insolvency and bankruptcy fears. Last Friday, Three Arrows Capital filed for Chapter 15 bankruptcy in New York after weeks of speculation that it was insolvent.

In addition, another major crypto lending platform, Maple Finance, recently halted customer withdrawals after facing liquidity-related issues.

Digital assets lending firm Genesis Trading is reportedly facing losses in the hundreds of millions after the company had significant exposure to financial woes facing Three Arrows Capital and crypto lending platform Babel Finance. BlockFi also experienced substantial losses related to its exposure to Three Arrows Capital.

Such lending firms normally collect crypto deposits from retail customers and invest them in the equivalent of the wholesale crypto market, including “decentralized finance (DeFi) sites that use blockchain technology to offer services such as loans, insurance, among others outside the traditional financial sector.

Okcoin Halts U.S. Dollar Deposits After Signature Bank Shutdown

Okcoin, the U.S. affiliate of cryptocurrency exchange OKX, announced on March 13 that it had no exposure to defunct U.S. tech bank Silicon Valley Bank (SVB). However, Okcoin CEO Hong Fang stated that the platform’s U.S. dollar wire and ACH deposits had been “immediately paused” due to the regulatory intervention in Signature Bank, Okcoin’s primary partner for customer transactions in dollars.

On March 12, New York state regulators closed Signature Bank, a major financial institution for fiat-crypto on-ramping, citing a “systemic risk exception” in the wake of SVB’s collapse. In addition to suspending dollar deposits, Fang wrote that “over-the-counter services will be temporarily paused too,” including its quick buy and recurring buy functions. Okcoin also stated that the suspension extends to “crypto transactions by credit card” and “trading USD-crypto trading pairs.”

Fang reassured users that “all corporate and all customer funds are safe” and that “USD withdrawal not affected. The processing pace will be subject to bank operation.” All crypto deposit and withdrawal functions remain intact, including those of U.S. dollar-pegged stablecoins. Furthermore, the suspension appears limited to dollar deposits, as other fiat deposit methods, such as those made in euros, are unaffected.

Okcoin is working to find alternative channels and solutions in real-time, and the suspension is not expected to impact crypto transactions significantly. Fang emphasized the platform’s commitment to its users, stating, “If this weekend has told us anything, it’s the significance of the future that we are building. Our commitment to you hasn’t changed either.”

The crypto-friendly Signature Bank was a key partner for many crypto firms, including Coinbase, Celsius, and Paxos, which have since disclosed that they held balances in the bank. U.S. federal regulators have stated that Signature Bank depositors will receive their balances in full post-shutdown.

The shutdown of Signature Bank has raised concerns in the crypto community about the risks associated with fiat-crypto on-ramping and the importance of selecting reliable banking partners. While Okcoin has assured its users that their funds are safe, the incident highlights the need for greater transparency and accountability in the crypto industry.

web3 gaming METAPIXEL Suspended Indefinitely

On October 10, 2023, Kate, a core member of the METAPIXEL team, announced via Twitter that the project has been “suspended indefinitely due to various circumstances.” Daniel and Nathan, other key figures in the project, echoed this sentiment in their own statements. All team members have ceased to represent METAPIXEL and will no longer be part of the project.

Kate expressed her emotional struggle with the decision, stating, “My heart feels heavy, as I had never dedicated myself so wholeheartedly to a project in my entire career.” Daniel and Nathan also shared their personal disappointments, emphasizing the “pinnacle” of their careers that METAPIXEL represented.

While the exact reasons for the suspension remain undisclosed, the team cited “recent shifts in both internal and external circumstances” as contributing factors. Daniel mentioned that these shifts have made it impossible for the GSU project, a subset of METAPIXEL, to continue its journey.

The METAPIXEL community has shown immense support for the departing team members. Community moderator Zesti thanked Kate for her dedication and expressed hope for future collaborations.

Although the METAPIXEL project has come to an abrupt end, team members are optimistic about future endeavors. Kate looks forward to “crossing paths” with the community again, while Daniel plans to take several months to reflect on his career and future directions.

The indefinite suspension of the METAPIXEL project marks a significant moment in the blockchain space, leaving questions about the future of the team and the technology they were developing. As the team members take time to regroup and plan their next steps, the community remains hopeful for what the future holds.