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BitForex Suspend Operation Following $57M Transaction

The Hong Kong-based crypto exchange BitForex has ceased operations. News concerning the closure of business elicited mixed feelings among the crypto community. Shocking to many, the BitForex team had not informed the community about the plans to wind down the operation.

Some of the BitForex users lamented that they could not access their funds. Other speculators argued that BitForex had suffered an exit scam where the key stakeholders abandoned the project to fulfill their interests.

BitForex Suspend Withdrawals

The unexpected closure of BitForex operations grab the attention of key industry players. In a subsequent report, the renowned on-chain investigator ZachXBT identified a high-value transaction on the hot wallet.

ZachXBT noted that approximately $56.5 million was transferred from the BitForex wallet on February 23. The probing team indicated that after the multimillion-dollar transaction, the BitForex trading volume on CoinMarketCap and CoinGecko dropped to zero.

The indefinite withdrawal suspension forced the ZachXBT team to review the BitForex website thoroughly. In their observation, the ZachXBT team noted that a few pages on the BitForex webpage were still accessible.

The investigators observed official announcements, including the departure of the former chief executive, Jason Duo.The ZachXBT lamented that other announcements containing important information were inaccessible.

BitForex Community Express Concern of Indefinite Closure of Exchange

The unexpected suspension of withdrawal and depository services ignited embroiled debates on Telegram. One of the Telegram users complained that he could not access his BitForex account. Others lamented that after signing in to their respective BitForex wallet, the dashboard recorded zero balances.

The BitForex Telegram account was bombarded with multiple complaints from the affected costumers. Market critics argued that the BitForex team deleted messages concerning the matter instead of responding to the numerous queries.

They observed that the BitForex community manager has been silent concerning the matter. Also, the speculators noted that the community manager changed their user details and remained hushed.

Impact of Exit Scam

The long silence of BitForex impacted the creation of the Telegram group dubbed “scammed by BitForex.” This group deliberates on matters concerning the unplanned closure of the BitForex.

Following the launching of the Telegram group, around 150 users have joined to find the way forward. The group has remained active for the past few days, and the affected customers are exploring suitable collective action to address the BitForex concern.

In the Telegram message, the BitForex customers urged the affected customers to report the matter to experts.

Apart from this, other BitForex users have reported the matter to the local authority. According to the report, the Securities and Futures Commission (SFC) in Hong Kong confirmed receiving multiple complaints from BitForex customers.

Upon contacting the BitForex team to inquire about business closure details, the crypto exchange did not comment. Hours after the incident, the BitForex team updated the OMI community on the unscheduled maintenance affecting the withdrawal and depository services on the exchange.

In its update, the BitForex team explained that the unscheduled maintenance interrupted the withdrawal services. The BitForex team vowed to keep the community up-to-date concerning the development of the ongoing maintenance.

Legal Charges Facing BitForex

A review of the crypto exchange website demonstrated that BitForex owns nearly 7% of OMI supply. According to the announcement, OMI is considered a utility token for the Veve marketplace.

Surprisingly, this was not the first time the BitForex team has indefinitely halted operations. In 2023, Japan’s financial service agency (FSA) took legal action against BitForex for failing to comply with the registration requirements.

Earlier, the FSA accused BitForex of providing fake information concerning the trading volume. Besides being caught on the wrong side of the law, the BitForex speculators suspect that the Hong Kong-based crypto exchange conducted an exit scam.

They argued that if the disgraced crypto exchange was involved in an exit scam, it would be among the first platforms to escape with customers’ funds.

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