Hong Kong-based crypto exchange AAX has reiterated that its suspension of withdrawals on the platform has nothing to do with the ongoing fallout from FTX’s collapse and rumors to the contrary are false.
The crypto community reported seeing a “System Upgrade Notification” message on November 13, stating that a system upgrade is “taking longer than usual,” which will delay withdrawals. Some shared concerns about whether the exchange was the next domino to fall after FTX and BlockFi.
However, in a November 13 post, AAX reiterated that the temporary shutdown of services was to fix a problem in a system upgrade.
The exchange said it was understandable that users might have panicked about the halt in withdrawals on Nov. 13.
“In light of the insolvency of one of our industry’s largest players last week, crypto users are rightly concerned about the operational and financial stability of centralized digital asset exchanges.”
We hope that as a community we can weather these troubling times, together.
— AAX (@AAXExchange) November 13, 2022
The crypto exchange, which is said to have 2 million users worldwide, explained that the planned system upgrade is the result of “the failure of our third-party partner”, which led to the balances of some users are “registered abnormally in our system”. ”
As a result, it has limited its services to prevent further risks, including a seven- to 10-day suspension of withdrawals “to prevent fraud and exploitation”.
Contagion fears from FTX’s fall have prompted many in the crypto community to advise others to withdraw their funds from centralized exchanges and into self-custody solutions.
AAX Vice President Ben Caselin in a November 13 Twitter post acknowledged the inopportune timing of the upgrade, but said it was aimed at addressing “serious vulnerabilities.”
Bad timing for scheduled maintenance at @AAXExchange, aimed at addressing serious vulnerabilities, to be extended for more than 24 hours. As an added precaution, this will take longer. Wait for the official announcement.
— ₿en Caselin HODL (@BenCaselin) November 13, 2022
Caselin also pointed out that the task was “not easy while the market is fearful”:
“Given the already frightening circumstances in the industry, the opening will require some caution and will be gradual, as sentiment cools.”
Related: FX Outflows Reach All-Time Highs as Bitcoin Investors Self-Hold
In a previous Twitter from November 11 Publish AAX said they had “no financial exposure to FTX and its affiliates.”
“Most importantly, all digital assets on AAX remain intact with a substantial amount stored in cold wallets, and user funds are never exposed to counterparty risk from any funding or venture capital activity,” a- he added.