Posted 2 years ago | by Ben Armstrong
Cryptocurrency Exchange IDAX Global CEO Missing Amid Reports of Exit from Chinese Market
Following a week of speculation, IDAX Global made a statement confirming that their CEO was missing and that the situation had forced them to put a lockdown on their cold storage solution.
The statement comes just days after IDAX had announced its intentions of entirely withdrawing it’s operations from the Chinese market. A statement released on the 25th of November 2019 confirmed the company’s intention of exiting the Chinese market.
Tougher Regulation and Customer Withdrawal at IDAX
The company cited customer withdrawals and tougher crypto regulations in China as some of the reasons behind their exit. The exit will deal the exchange a massive blow since a large portion of its trade volume originated from China.
Chinese crypto operations have been in a state of flux, as the recent stance on blockchain by the Chinese government has rasied hopes that the nation would be open to cryptos. However, this doesn't appear to be the case.
Current State of Operations
It was also reported that several employees had been laid off but this was yet to be confirmed at the time of reporting. Other reports suggested that the exit strategy was a scam and that the intention was to lay off a chunk of its labor force.
Several employees tried to get in touch with the CEO but they didn’t succeed. The CEO’s absence has destabilized operations at the crypto exchange. For one, users cannot make withdrawals or deposits but their website is still live.
But how is the exchange trying to remedy this current situation? IDAX plans to come up with an emergency plan to ensure customers can withdraw and even deposit their funds. Meanwhile, the company warned users against using the services in its platform.
This is yet another major crypto exchange problem, and it may further the use of decentralized platforms in the future. While centralized crypto platforms offer better pricing for traders, the risk of total loss makes those advantages less appealing.
The exchange can only hope for the return of their CEO and an optimal operation status. Meanwhile cold storage seems like the way to go. Cold storage has a more secure system and no funds have been reported missing to date.
The situation at IDAX should however serve as a daily reminder of how volatile and unpredictable crypto exchanges are especially in an environment without established regulations. While it is reassuring that the exchange's funds are likely safe, it remains to be seen if clients' funds are returned without hassles.