Cryptocurrency market update: Frozen accounts on Bitcoin HitBTC exchange

A report that first appeared on CCN, a crypto news outlet details that HitBTC moved to freez all its customers’ accounts in readiness for yearly proof of keys event. The news websites stated that the information has been confirmed by various sources.

This comes after the firm send a reply to a customer who was complaining of a withdrawal requests not going through. The customer directed the concerns via Reddit and notes that he has successfully passed the know your customer process on the exchange including the 6 months waiting period for a trading account. The customer made it clear that a huge chunk of his funds had been withdrawn, however, he is still holding a substantial amount in the public address that is used by intraday trading.

“After months of sending 40 plus emails, HitBTC finally unfroze my account,” PEDXS said in his complaint. “I immediately withdrew most of my funds but left a small amount to day trade. I did that because HITBTC promised that “No further automated restrictions will be applied.”

The complaints do not only come from one Reddit user, another user had expressed similar concerns after his withdrawal transactions failed to go through.

“Submitted all my documents/evidence for KYC days ago and now support [is] going cold on me. Have I been scammed? I have been trading crypto for years on all kind of exchanges and never had my funds locked without warning like this. Support [was] fast to respond when asking for additional (over the top) information but since I have given them everything they have asked for they’ve just disappeared on me.”

It is believed that the exchange company is suspending customer’s accounts in order to control the withdrawals as the annual proof of keys event approaches. The proof of keys event was publicized by Trace Mayer. The event encourages investors to make withdrawals of the assets kept with third party custodians every January 3. This allows the investors to ensure that the third party custodians pass the solvency test.

In regards to HitBTC suspended accounts, a reviewer called Harsh Agrawal said:

“HitBTC was something that began as a promising crypto exchange and got lucky with the big crypto wave in 2016 and 2017, but it [definitely] failed to keep up with the innovation and user demands.” He continues “They are barely surviving, and this can have a major impact on users who are using HitBTC as their crypto exchange.”

Another leading expert in the market, John McAfee reckons that:

“The crypto exchanges have become the thing that we have originally fought against. Their power is immense. Hitbtc, for example, has increased suffering for millions of poor people who cannot afford the minimum buy-in since it is greater than their monthly income. Boycott them.”