CoinFLEX Halts Cryptocurrency Withdrawals, Indian Exchanges Brace For Drawn-Out Crypto Winter
Meanwhile, WazirX has also cut down all “non-critical costs.”
CoinFLEX has become the latest crypto exchange to temporarily halt withdrawals, citing the overall cryptocurrency market’s extreme volatility as the primary concern. The announcement comes nearly a week after Indian crypto exchange CoinDCX said it has restricted deposits and withdrawals for several users in order to strengthen its “compliance and risk framework.” The move was made without prior communications, sending waves of panic among users of the platform. Popular Indian exchange WazirX has also put its expansion plans on the back burner for now as several companies in the country are preparing for a drawn-out crypto winter.
CoinFLEX CEO Mark Lamb said in a blog post last week, “Due to extreme market conditions last week and continued uncertainty involving a counterparty, today we are announcing that we are pausing all withdrawals. We fully expect to resume withdrawals in a better position as soon as possible. We will fully communicate with you as we find out more.” He added that crypto withdrawals are expected to be resumed by June 30.
Lamb clarified that the “counterparty” in question is neither crypto hedge fund Three Arrows Capital (3AC) nor any lending platform. The 3AC was reportedly looking to consider options, including the sale of assets and a third-party bailout.
Meanwhile, WazirX said it has cut down all “non-critical costs,” as reported by Bloomberg. The company’s vice president Rajagopalan Menon said, “We have cut down all our non-critical costs. We are hiring only critical hires, we aren’t spending money at all. It’s literally crypto winter here.”
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Apart from WazirX, Indian rivals Unocoin and BuyUCoin are also reportedly responding to quickly vanishing trading volumes.
Earlier this month, Coinbase, the largest crypto exchange in the US by trading volume and the first crypto company to get listed on Fortune 500, laid off around 18 percent of its global workforce. A total of about 1,100 employees were relieved. Coinbase CEO Brian Armstrong tweeted, “The broader market downturn means that we need to be more mindful of costs as we head into a potential recession.”
Crypto Winter: When will it be over?
There are no definite indicators that can help ascertain when a crypto winter period will exactly be over.
However, if we look at historic trends, this isn’t the first time the market has seen a crypto winter. And it’s safe to speculate that the crypto winter will be over at some point of time, when the crypto market will stabilise again. The last crypto winter lasted for about two years, from January 2018 to December 2020, when Bitcoin lost over half of its market cap, as per Forbes.
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.
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