Hi everyone. This article will cover how two of the top worldwide cryptocurrency exchanges, namely Bittrex and Bitfinex, are each rapidly beginning to close down many of their users' accounts. This seems to be affecting a huge pool of users for each of these exchanges, and may also be taking a toll on the Bitcoin price.
Let's see what's going on.
Bittrex Mysteriously Booting Thousands of Accounts
Bittrex, one of the most popular cryptocurrency exchanges and one of the altcoin exchanges with the most volume, has begun to mysteriously boot thousands of user accounts. According to users, the most affected countries may be in the middle-east and eastern Asia, namely India, Iran, Pakistan, Syria, Turkey, and Russia, with some from Afghanistan.
When an affected user attempts to log onto their account, they get a message like the one shown below. This affects all types of users, even verified ones:
Customer Support Taking a Vacation?
Bittrex customers affected by this are swarming to places such as Twitter, Bittrex's Slack Channel, their customer support, and other venues to try to get ahold of Bittrex. However, Bittrex seems to be simply ignoring all of these customer requests.
Some users have very large amounts of Bitcoin and altcoins stored on Bittrex, and are frantically trying to cope with the situation. We're all trying to avoid a situation similar to the one in early 2014, when infamous exchange Mt. Gox shut down, barring access to users' bitcoins.
Though we're not sure of the exact cause of the shutdown or the reason for Bittrex's silence, it's clear that things are not looking good.
Bitfinex Officially Closing Down US Accounts
Bitfinex, another super popular exchange, is now officially asking US customers to remove all coins from their exchange. Already, Bitfinex does not allow United States users to become "verified." However, this next step seems to be preparing for a total shutdown of United States service.
In Bitfinex's blog post, Bitfinex specifically notes that the message is, "with respect to terminating our business with U.S. individual customers."
Bitfinex has made it clear yesterday that they will not be operating in the US anymore:
As indicated in the announcement, we are terminating trading, deposits, and withdrawal functionality for U.S. individual customers by no later than November 9, 2017. U.S. customers are already barred from receiving financing from other users on Bitfinex’s peer-to-peer financing platform. This restriction will remain and, in addition, U.S. individual customers will no longer be able to provide financing on Bitfinex effective November 9, 2017.
All U.S. individual users must make arrangements to withdraw their Digital Tokens by November 9th.
It seems that November 9th, 2017 is the (latest) day when all functionality will be prohibited for US customers, even including withdrawals. If you are in the U.S. and you're using one of these exchanges, please immediately begin to secure your altcoins and bitcoins.
Bitfinex seems to be blaming this pull out of the US market, on tight rules and regulations. Bitfinex itself is not based in the United States, and it seems they feel a US-based exchange would be more ready to cope with such things.
Move your Bitcoins Immediately
As you can see, with exchanges, things can topple very fast. The old adage goes, "If you don't know the private key behind your bitcoins, they aren't yours."
When you deposit Bitcoins to an exchange, you give up all rights to the Bitcoin. The exchange "promises" you to let you trade with those bitcoins, but you don't actually own them on the blockchain.
This is why it's imperative that, in events such as hard forks and calamities like this one, you get your coins out of your exchange, and fast. If you wait too long, you may end up suffering huge financial damages and trauma.
Thanks for reading,
— @mooncryption
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Bitfinex made the decision to cut off US clients a few months ago, so I'm not surprised with that, but the Bittrex situation is quite bizarre.
Maybe the U.S. regulators, even the Trump admin, may be putting pressure on Bittrex to cut off certain users.
Remember how the Justice Department put pressure on PayPal, Visa and MasterCard to stop services to Wikileaks? It would not surprise me one bit if we see similar maneuvers regarding the crypto exchanges.
In August, Bitfinex basically told US Customers to "start packing your things," and yesterday they gave them their deadline to do so. This is why I believe, even though this situation isn't great, that Bitfinex handled things professionally.
However, Bittrex is a different story, because it seems they're randomly closing accounts without responding to requests and telling people the reason. Get your coins out of exchanges!
Oh no that's awful. I remember when cryptsy.com went down and had to withdraw everything via dogecoin and mooncoin. Finally withdrew mooncoin that was trapped on an online wallet after that about
Bitfinex has already been hacked once I do not know why people continue using that exchage!
YEAH THEY ARE! I just got my notice and I went ahead and transferred everything out immediately and closed my own accounts...
It's depressing that these exchanges are shutting down. We shouldn't let the lawmakers win the fight!
Also, it's great that you were able to withdraw everything on time. If anyone's on Bittrex or Bitfinex, start getting your coins out of the exchanges!
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The Bittrex situation is really beyond unfair. Least they could do is informed each user - yet, what happens is they get a generic message that their account is disabled because of reason A, B, C or maybe D, sucks to be you basically. WTF?
Hopefully decentralised exchanges will take off even more in the future. For altcoin-to-altcoin exchanges, there's really not much reason to go through a centralised exchange or is there. Only once you deal with FIAT is it really necessary to go through a regulated exchange.
Exactly. DEXs seem like the only way to rid ourselves of this problem. Hopefully as cryptocurrencies get even more popular, decentralized and altcoin-to-altcoin exchanges rule over the fiat ones, as nobody will be using the fiat ones anymore!
DEX have somewhat taken off this year actually. Last year there was barely any volume at all. Now - I just checked - Etherdelta and Bitshares traded about $5m in 24h not bad. Hoping the trend continues, I mean how awesome would it be for a DEX to be the #1 spot on coinmarketcap?
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Great article, I didn't even consider the possibility that the Bitcoin price dips in the last couple days could be related to fears about the future of exchanges, especially for customers in countries where regulations are likely looming on the horizon.
Let's hope that investor sentiment can remain positive despite all the issues we're currently facing with exchanges.
i can totally see Bittrex.com be forced by the IRS and Pentagon to shut down account due to many reasons such as terrorist prone countries using exchanges to money launder, have indirect access to the US and making mooney from it, the list probably goes on and on..