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OKEx CEO Jay Hao assured OKEx customers that their funds are safe and the investigations are being carried out.
Malta-based cryptocurrency exchange OKEx has announced that all digital assets withdrawals are suspended indefinitely after one of its private key holders went missing. The unfortunate incident leaves OKEx customers in the hand of the private key holder, although their funds are reportedly safe.
“One of our private key holders is currently cooperating with a public security bureau in investigations where required. We have been out of touch with the concerned private key holder,” OKEx indicated in a note to its customers.
The company has clarified that other services in the exchange remain unaffected and traders can continue without fear. However, things cannot continue normally until the case is resolved.
OKEx Withdrawals Suspension
Disagreements at the top management should not affect customers’ business if it was not included in the Terms of Service. The unfortunate incident has triggered fear among cryptocurrency investors as Bitcoin and other digital assets had dropped considerably during Asian and London trading sessions on Friday.
As for Bitcoin, it was trading around $11,264.42 having dropped more than 2% in the past 24 hours.
The sell-off has occurred in leading altcoins including Ethereum that was trading around $364, 3.46% down, XRP around $0.23974 having dropped approximately 2.59%. OKEx crypto exchange has defended its action, citing it was all included in the terms and conditions to interrupt, suspend or terminate services without prior notice.
“Pursuant to 8.1 Service Change and Interruption of the Terms of Service, OKEx may change the Service and/or may also interrupt, suspend or terminate the service at any time with or without prior notice,” OKEx explained
This is malice of the highest degree putting in mind there were innocent traders who might need their capital urgently.
Notably, media outlet Coindesk has reported that hours before the announcement, significant withdrawals were completed from known OKEx-affiliated addresses. OKEx CEO Jay Hao, through his official Twitter page, assured OKEx customers that their funds are safe and the investigations are ongoing.
All operations @OKEx except digital asset/cryptocurrency withdrawals remain unaffected.
All your funds and assets are safe.
The investigation concerns a certain private key holder’s personal issue only. Further announcements will be made.
— Jay_OKEX_CEO (@JayHao8) October 16, 2020
Such incidents drag behind the crypto industry that has tremendously grown over the past decade.
OKEx has been focused on Asian markets that have largely adopted digital assets and blockchain technology to improve the payment system. It is suspected that the raid on OKEx has been initiated by Chinese authorities who are cracking down on fraudulent activities on crypto exchanges. Although it is a single out case, it is high time other crypto exchanges seek to decentralize their services to avoid similar cases in the future.
Decentralized exchanges alias DEXs ensure no single person is in control of customers’ funds. Therefore giving customers personalized responsibilities to take care of their funds by safely storing their security private keys.
Such downtimes can be avoided if all crypto exchanges upgraded their systems to complete decentralized systems.