OKEx users will have to wait for another month before they get their money back


  • OKEx users are still in trouble as the cryptocurrency exchange co-founder remains under investigation.
  • Other Chinese trading platforms may face similar issues, as Chinese authorities tighten crypto market regulation.

OKEx, one of the world's largest cryptocurrency exchanges, stopped trading and froze withdrawals on October 16, after the Chinese police launched an investigation against the company and arrested one of its co-founders. Several days later, the platform re-activated the P2P trading, but withdraw functionality is still unavailable.

Users are growing desperate as there is no information for when they will get their money back. Some of them even have taken their credentials outside of the exchange and are trying to sell their USDT and BTC locked on OKEx with up to 20% discount.

Read the in-depth story of what happened to OKEx here.

No hope, no money

According to the popular Chinese cryptocurrency reporter Colin Wu, the OKEx official who is under investigation, Star Xu, will stay under residential confinement while he is suspected of a criminal offense. In this case, the investigation period might last from 37 days to half a year.

Shedding light on how the process is arranged in China, Wu notes that Xu may be locked in a small room with white walls on all sides, no windows, and no sunlight all day long.

 

The expert also explained that the authorities often resort to residential confinement to avoid the 30-days limitation applicable to the ward detention prior to sentence. In the case of residential custody, they can keep the suspect under control for up to six months. 
 
Considering that Star Xu is the one who holds the private keys of the cryptocurrency exchange wallets, this development may further frustrate OKEx users who can't get a hold of their funds. 

Huobi next in the line?

The senior officials of another Chinese cryptocurrency exchanges may face the same issues. Earlier this week, rumors of the Chief Operating Officer of Huobi, Zhu Jiawei, being under investigation hit the market and spooked the cryptocurrency traders. 

While Jiawei is a less critical person for Huobi, the news caused massive cash outflows from the exchange and crashed its native token Huobi Token (HT) by over 10% in a matter of hours.

The trading platform denied the rumors and confirmed that it continued operating as usual. However, the harm was already done. At the time of writing,  HT/USD is changing hands at $3.3, down over 5% since this time on Tuesday.

Huobi Token price chart in USD

HT/USDT 1-hour chart

According to Colin Wu, Huobi is the exchange with most Chinese users and the most extensive Bitcoin trading platform in the world. Thus, the troubles will not pass unnoticed.

China cracks down on crypto

The recent developments may signal that the Chinese authorities are taking a strict approach to the industry before the official launch of its own central bank digital currency (CBDC). 

As it was earlier reported, China has proposed draft legislation to ban issuing, selling, and buying private cryptocurrencies on the country's territory. If the law is enacted, all digital coins except for the digital yuan will become illegal in the mainland.

Also, some of the local media outlets reported that purchasing crypto with RMB and selling it for the foreign currency may be considered as money laundering, as well as selling crypto purchased with foreign currency to withdraw RMB.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

ADA could retrace in the short-term before massive 20% breakout

Cardano has been trading sideways since its high of $1.48 established on February 27. The digital asset just had a significant breakout from an important pattern and aims for a high of $1.5 in the long-term.

More Cardano News

Ethereum price poised for greatness as on-chain metrics suggest move to $2,000 is approaching

On January 14, Ethereum price had a significant spike and started to outperform Bitcoin for the first time since July 2020. However, the trend didn’t last long and ETH started to fade away in February despite Bitcoin price also falling. 

More Ethereum News

VET hints at a 75% bull rally

VeChain price has been consolidating in an ascending parallel channel for over the past two months. The pattern’s lower trendline cushioned the recent 42% crash. Bouncing off this support level now suggests the possibility of a 75% upswing towards the channel’s upper trendline at $0.084.

More VeChain news

Crypto bull market warming up as Bitcoin heads for $58,000

The cryptocurrency market seems to be flipping bullish after Bitcoin made a real move above $50,000 on Wednesday during the European session. BTC's move also poked Ethereum bulls to join the market from the sidelines, pushing the price past $1,600. 

More Bitcoin News

BEST CRYPTO BROKERS/EXCHANGES




Bitcoin Weekly Forecast: BTC journey to $100,000 might be easier than expected

This past week has been extremely beneficial for Bitcoin which jumped by 30% since Monday 8. Several positive announcements, especially Tesla purchasing $1.5 billion worth of the digital asset propelled the flagship cryptocurrency to new highs.

Read the weekly forecast

BTC

ETH

XRP