- Bitforex resumes withdrawals after a 5-month suspension due to a police investigation and $56M user withdrawals in February.
- Users must complete KYC to withdraw funds from Bitforex; new registrations and deposits are suspended during the transition.
- Bitforex’s hot wallet activation with $43M in TRB tokens raises compliance concerns as former CEO Jason Luo resigns.
Cryptocurrency exchange Bitforex has announced that user withdrawals will once again be accepted after a five-month suspension; this restriction came after a large-scale financial withdrawal in late February and a police probe in China’s Jiangsu Province.
$56 Million Withdrawal and Platform Inaccessibility
On February 23, users withdrew approximately $56 million from Bitforex, which then became unresponsive. Consequently, the exchange ceased operations, preventing users from accessing their funds.
Bitforex claims that on February 23, the Jiangsu Province police arrested and questioned members of its team, rendering the platform unavailable. Although the exchange did not provide specifics about the investigation, it claimed to have resolved the issue through persistent efforts and communication.
On July 19, Bitforex said that consumers would soon be able to take their assets out. Nevertheless, during this time, the platform will not permit the purchase or sale of tokens. To withdraw money, users must finish the KYC (Know Your Customer) process and present identification. Additionally, during this changeover, the platform will not accept new registrations or deposits.
Regulatory Concerns and Compliance Issues
In March, Hong Kong’s securities regulator labelled Bitforex as a “suspicious” crypto platform. The lack of communication from Bitforex also led to legal threats from projects such as the memecoin CatCoin. This uncertainty surrounding the platform further fueled concerns among its users.
Moreover, former Bitforex CEO Jason Luo resigned in January, just weeks before the platform halted withdrawals. On July 19, he echoed the exchange’s message about the police investigation on his X account, formerly Twitter.
In addition, reports noted that Bitforex’s hot wallet, inactive until June, was activated with $43 million in TRB tokens. This activation raised concerns about the platform’s compliance status and future activities.
Bitforex has issued an apology to its users and assured them that measures have been implemented to safeguard their funds from further loss. As the platform begins to reopen withdrawals, users should consider transferring their assets to personal or third-party wallets to ensure their security.
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