Hotbit Announces Suspension of Operations - Hong Kong-based cryptocurrency exchange announced earlier today that it would suspend its crypto services.
Hotbit Announces Suspension of Operations – Hong Kong-based cryptocurrency exchange announced earlier today that it would suspend its crypto services. The exchange company with over 5 million users worldwide made this known citing “deterioration of the operating conditions” as the core reason.
In the latest turn of events, Hotbit has joined other exchange companies that have seized operations recently. The announcement was made a few hours ago via its website.
“For 5 years and 4 months, the Hotbit team has been proud to participate in a wonderful crypto show with 5 million users. However, it is with great regret that we have made the decision to stop all CEX operations from May 22, UTC 04:00,” it said.
With the latest update, platform users have been given a timeframe to withdraw their funds. According to the release, users have a space of one month, until June 21 to remove all held funds.
“We kindly ask all users to withdraw their remaining assets before June 21, UTC 04:00,” it said.
Reasons for suspension
Furthermore, the team also cited three primary reasons for the decision. The first reason given was “deterioration of the operating conditions.” Recall that the Hotbit team was forced to suspend operations in August 2022 due to investigations. After that, the crypto industry suffered all kinds of crises which saw the shutdown of some notable players in the industry.
- Bittrex Seeks $7 Million Loan to Start Bankruptcy Case
- Struggling Crypto Lender Celsius Files for Chapter 11 Bankruptcy
- Hotbit Announces Suspension of Operations
- Voyager Working to Begin Payout by June 1: Reports
The second reason given was the changes in the crypto industry. It believes operating a centralized exchange (CEX) is becoming more difficult, especially with “highly complex and interconnected businesses that are difficult to comply with.” It also pointed to the effect of the collapse of large centralized institutions.
Thirdly, Hotbit cited the crypto industry uncertainties as another reason for suspending operations. Hotbit was the first exchange to list several upcoming assets like SHIB, KSM, GRIN, and others. It also was the first to “conduct Defi mining business using Compound.” However, the industry uncertainties also bring several risks. In the past, the exchange giants have suffered problems like continuous cyber attacks, which resulted in significant losses.
With these points, the Hotbit team thinks that the business model is “unsustainable,” looking at it from a risk management point of view.
Regardless, Hotbit still believes in the future of cryptocurrency and hopes they will still fight for it.