OKCoin and Huobi announced that they will postpone bitcoin and litecoin withdrawals for approximately a month. Although, deposits and withdrawals in regular fiat and other services will not be affected at all.
Of course, bitcoin reacted to the news with a sharp drop... likely before realizing nothing has actually happened and press headlines were designed for alarm.
Sudden AML Concerns
The sudden adjustment is so that they can improve anti-money laundering (AML) capabilities in an effort to not get fined or shutdown which would be possible without adhering their platforms to regulatory requirements.
Did these folks just realize bitcoin might just be used to launder money? Other China based exchanges seem to have things in order, but not these two, they're in such bad shape they have to stop withdraws for a month.
Thus, if you OKCoin or Huobi your coin in China, well, you're SOL since you can't really move it to one of the more prepared platforms. However you can still trade and still take profit as needed so this is really a big deal about nothing.
Reading Between the Lines
So let's get to the root cause of it all.
Today's events come after China's central bank issued a warning to exchanges that not following their guidance may result in unpleasant occurrences.
Naturally, OKCoin and Huobi are doing what just about every other business on earth would do ... covering their ass.
Can't blame them really, but here's the problem.
OKCoin and Huobi took as much profit as they possibly could for as long as they could possibly get away with it and then just before they were about to get bitch-slapped, they pull an unexpected, unannounced, and immediate action of freezing other peoples bitcoin and litecoin subsequently resulting in thousands of innocent helpless users without coins for a month, a market crash with millions in loss, and overall just sticking everyone else with the consequences of their own deliberate negligence and/or unpreparedness.
If this industry had a Raspberry Award, OKCoin and Huobi would certainly be contenders. Perhaps regulators in China need to take a closer look as these two ....and bitch-slap them anyway.
Report by dinbits
Image by dinbits.com staff
The opinions expressed by authors of articles linked, referenced, or published on dinbits.com do not necessarily express, nor are endorsed by, the opinions the of dinbits.com or its affiliates.
Post a Comment