BitForex, a cryptocurrency exchange in Hong Kong, suspended withdrawals for three days without explanation. According to on-chain analysis, approximately $56 million worth of cryptocurrency was transferred from BitForex’s wallets.
ZachXBT, an on-chain investigator, reported on February 23rd that three BitForex hot wallets experienced total outflows of around $56.5 million in digital currencies before the exchange stopped processing transactions. BitForex’s X account has not been active since May 2023.
On BitForex’s official Telegram channel, users have reported various account issues, ranging from inability to log in to dashboards showing zero balances. Several users shared screenshots demonstrating being blocked from the exchange’s website.
While some BitForex webpages were still accessible, the main site did not load. January 31st, the announcement that BitForex CEO Jason Luo had departed remained live. In September 2023, BitForex ranked among the top global exchanges by trading volume, which reached approximately $2.6 billion daily. Presently, CoinMarketCap displays no live BitForex data.
In April 2023, Japan’s Financial Services Agency accused BitForex of conducting unregistered business in the country, violating settlement laws. However, since then, regulators and the media have paid little to no attention to BitForex.
Last week, another Hong Kong exchange, AAX, transferred around $55.6 million worth of Ether from its wallets before halting operations indefinitely on November 13th, 2022. Subsequently, the Hong Kong police arrested AAX’s former CEO, Thor Chan, and board member, Haoming Liang.
The recent cluster of Hong Kong-based exchanges restricting withdrawals has raised concerns surrounding centralized exchange solvency and may accelerate the crypto industry’s gradual migration toward decentralized models. However, the exact reasons behind BitForex’s current issues remain unclear, pending further announcements.
Also Read: Hong Kong Alerts Crypto Investors to Verify Platform Status
