In cryptocurrency news that has caught most crypto enthusiasts by surprise, cryptocurrency exchange Hotbit has today (May 22, 2023) announced that it is halting its operations with immediate effect.
In its official communication, the exchange has asked its users to withdraw their funds before June 21, at 4:00 am UTC.
Deteriorating operating conditions
Hotbit has said that its operations have greatly deteriorated since August 2022 after a former team member was subjected to an investigation. The investigation had caused the centralized exchange to halt operations for weeks.
Hotbit has also cited several other negative incidents within the crypto industry among them the FTX collapse and the recent banking crisis that temporarily caused the USD Coin (USDC) stablecoin to depeg. According to the crypto exchange, the mentioned incidents lead to a continuous outflow of funds from centralized exchanges.
The exchange’s team also believes that centralized exchanges are becoming “increasingly cumbersome” and that they are “unlikely to meet long-term trends.” They noted that the only options would be to embrace regulation or become more decentralized.
Repeated cyber attacks
Hotbit has also blamed the repeated cyberattacks where hackers have repeatedly exploited its defects. On the same note, the team has warned community members to be wary of phishing links pretending to be the official Hotbit exchange on Google (NASDAQ: GOOGL).
Hotbit’s announcement came at a time when several community members started complaining that they could not withdraw their funds from the exchange.
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