OKEx, one of the leading exchanges for spot crypto and its derivatives, has suspended all withdrawals indefinitely and blamed the loss of connection to one of the private key holders. In an official statement released on Friday morning, the exchange said it had suspended all 4 pm Hong Kong withdrawals on October 16.
The statement highlighted that one of their private key holders has been out of touch with the exchange but is currently working with the Public Security Bureau on an investigation. OKEx’s CEO later said the research is due to the key holder’s issue.
Customer Priority at OKEx
The exchange points to a service contract that allows it to take such drastic action. It further emphasizes that all decisions made are in the customer’s best interest.
It states that in relevance to 8.1 Modification of Service and Termination of the Terms and Conditions, OKEx may at any time, with or without notice, change the Service and interrupt, suspend or terminate the Service.
Meanwhile, this sudden pause in downloads has created discontent in the crypto community. Many took to Twitter to criticize the move.
Bitcoin Price Plunge
Bitcoin prices on exchanges also fell sharply by 3 percent after the suspension. Interestingly, before the closure, large removals of bitcoin, Ether, and Tron from OKEx-related wallets, according to Whale Alert, a blockchain tracker, and analytics service.
Transfers out, including 1,180 BTC worth $ 13.6 million, 50 million Tron (TRX) worth $ 1.3 million, and 21,000 ether (ETH) happened over six hours, together with incoming transactions of approximately USD 13.9 million. According to Whale Alert’s feed, the transfers occurred in the same period of coin movement from the Bitfinex hack. However, it may be a coincidence, given the many transactions that happen every day.
The Incident’s Possible Link to Money Laundering
Beijing reporter Colin Wu suggested the OKEx investigation’s probable link to money laundering. He said the Chinese government cracked down on money laundering using cryptocurrency for telecommunications fraud and that centralized exchanges were in a very dangerous state.
However, Wu’s information has not been verified at this early stage, but we will keep you updated on new developments.
The situation with OKEx arises from a 48 hour period in which at least 33 arrests were observed as the result of separate law enforcement operations against global money-laundering operations in North America, Oceania, and Europe.
All in all, OKEx’s other functions remain normal and stable, and the security of all assets at OKEx will not get affected. Resumption of digital assets/cryptocurrencies withdrawals will continue immediately once the concerned private key holder can authorize the transaction.