For about a week, uncertainty about why OKEx suddenly stopped withdrawing cryptocurrency on October 16 remained unresolved. The current commentary was confusing to many, but exchange officials say the move only happened because one of the company’s key holders worked with a Chinese security agency. With one of the three OKEx key holders currently in question, the multi-signature authorization process cannot be implemented in the exchange, so the revocation function is blocked.

After reports that OKEx founder Mingxing Xu was under investigation by the Chinese authorities, the price of bitcoin fell by about 3% in less than half an hour. Not only that, but the original OKEx cryptocurrency offering – the OKB token – was also there, with the coin’s value depreciating by about 25% after the accident occurred.

It should be noted that just hours before OKEx stopped giving up services, transaction monitoring platform Whale Alert noticed several large transfers between OKEx and some unknown wallet addresses. In total, the transfer of 1,180 bitcoins (BTC) was followed by another 3,500 – for a total of about $ 53.2 million. In addition, $ 50 million Tron (TRX) worth $ 1.3 million was transferred, as well as $ 21,000 ETH worth $ 7.9 million, and an incoming transaction of approximately $ 13.9 million was transferred to Tether (USDT ).

Jay Howe, CEO of OKEx, directly addressing the issue, told Cointelegraph that while he was well aware that the company’s current actions could negatively impact customer sentiment, the decision was made with user safety in mind:

“We sincerely apologize. As a leading global exchange company, OKEx cannot and will never give up on user safety. We will do our best to quickly restore this service and provide updates as soon as possible. ”
Hao went on to emphasize that apart from withdrawals, all of OKEx’s other services such as deposits, spot trading, derivatives and rates remain unchanged. On October 21, Tron announced that it will facilitate an alternative 1: 1 “internal transfer” for all TRX holders directly affected by the withdrawal freeze.

Why is it so imperceptible?
It is understood that the company is not obligated to share confidential survey data with its customers immediately after a sudden power outage, customers began to feel that it would be desirable to bring more clarity given that OKEx’s withdrawal ban has been in effect for more than four days.

An OKEx spokesman shared his thoughts on the case with Cointelegraph, saying that due to some unforeseen circumstances, the company is unable to disclose the nature of the ongoing investigation. Like Howe, she stated that despite the inconvenience, it is important for the company’s customers to understand that the decision to stop using cryptocurrencies was made to ensure a high level of security. She added:

“We will provide status updates and restore full service as soon as possible. There is no reason to worry about the security of cryptocurrencies for our users and that no other activity on our platform has been stopped. Although we have worked as usual, with the exception of the withdrawal, we apologize if you feel that we are silent. We provide updates. Daily on Twitter. ”
Ben Zhou, CEO of ByBit, a Singapore-based cryptocurrency exchange, believes that while it is harmful to draw conclusions too early, central exchanges should better avoid a single point of failure in the future and create resilient contingencies to ensure maximum security availability. and service throughout. time. He added: “Transparency is key, especially in the field of cryptography, where there are many uncertainties and potential risks. Trust goes both ways and is built on openness. ”

Cryptocritics say it’s theirs
While Bitcoin continued to grow impressively after the price fell 3%, there was still a reason why the overall cryptocurrency market sentiment was negatively impacted by OKEx’s stance, as well as what happened to the BitMEX cryptocurrency exchange.

Earlier this month, several federal agencies in the United States indicted top BitMEX officials Arthur Hayes, Samuel Reed and Ben Delo. As a result, the 100x Group, the parent organization that manages BitMEX’s day-to-day operations, announced that it would no longer have leadership roles in the company. On September 26, KuCoin likely contributed to the market position as it announced that it was undergoing a major hack that saw the company’s hot wallets Bitcoin, Ether and ERC-20 plummet to more than $ 275 million.

Source: CoinTelegraph