Several crypto exchanges are suffering from FTX’s aftermath
The bankruptcy of the crypto exchange FTX escalates to the crypto industry. Huobi-related subsidiary is the latest victim.
Citing “No Withdrawal of Cryptocurrency Assets from Crypto Exchange FTX”, Hong Kong-listed company New Huo Technology Limited (HKEX: 1611) announced insider information on Monday that around $18.1 million in cryptocurrencies owned by its subsidiary Hbit Limited has been deposited in crypto exchange FTX, according to the latest announcement published on the Hong Kong Exchange.
Among the $18.1 million, about $13.2 million is “the client’s asset based on the client’s trade request and approximately $4.9 million is the asset of Hbit Limited”. The listed company warned that crypto assets “may not be able to be withdrawn from FTX” due to the bankruptcy protection filing declared by FTX on November 11, which is suffering from a liquidity crisis.
The board of directors of the company emphasized will continue to offer compliant, professional and safe virtual assets financial services to customers:
“The board is of the opinion that the incident does not currently affect the normal business operations of the group. Since Hbit Limited is legally and operationally separate from other business units in the group, other assets and business lines in the group will not be affected.”
The board acknowledged that its financial results could be affected if “the incident is not resolved”.
Meanwhile, another Hong Kong-based crypto exchange AAX is also suffering from the recent turmoil. AAX said on Sunday that the exchange is continuing the suspension of withdrawals for seven to 10 days due to “a planned system upgrade”, to protect users from malicious attacks
Ben Caselin, AAX Vice President, tweeted early Monday morning, acknowledging that this is “poor timing for a scheduled maintenance on @AAXExcahnge,” adding that the exchange “aims to address serious vulnerabilities, to be extended for more than 24 hours. Out of extra caution, this will take longer,” urging the public to allow AAX to gradually open.
However, AAX emphasized that the exchange has no financial exposure to FTX or ten affiliates, and its digital assets remain intact with a significant amount stored in cold walletsaccording to the statement.
FTX filed for bankruptcy protection last Friday after the exchange experienced a critical liquidity crisis, as its original token FTT experienced a massive price drop. FTX failed to complete an acquisition of its biggest competitor Binance, citing “the issues are beyond our control or ability to help.”
FTX was allegedly accused of unauthorizedly using its client’s capital to promote its sister trade Alameda Research. In addition, FTX also suffered from a hacking incident last Friday, over $600 million was bleached from its crypto wallets. Founder and former CEO Sam Bankman-Fried has stepped down.
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