Hotbit Exchange Suspends Operations, As It Urges Its Clients To Withdraw Funds

The unexpected events in the crypto ecosystem have led crypto platforms, including Hotbit, to face substantial roadblocks.

Hotbit has revealed the cessation of its Centralized Exchange (CEX) operations effective May 22. The crypto platform notably has notified its clients to withdraw their funds before June 21, at 4:00 am UTC.

It's time to take a bow ?
For 5 years and 4 months, the Hotbit team has been proud to participate in a wonderful crypto show with 5 million users. However, it is with great regret that we have made the decision to stop all CEX operations from May 22, UTC 04:00. We kindly ask all…

— Hotbit News (@Hotbit_news) May 22, 2023

In the announcement, the Hotbit exchange cited deteriorating operating conditions, a shift in industry trends, and unsustainable risk management practices. In August 2022, a former member of its team was subjected to an investigation leading to the suspension of services for weeks. However, this move led to continuous fund outflows and worsened cash flows.

Additionally, Hotbit cited various incidents within the crypto ecosystem that have contributed to its downfall. Some include the FTX demise and the bank crises that caused the USD Coin de-pegging event. These were some of Hotbit’s reasons for its declining cash flow from centralized exchanges.

On the other hand, the Hotbit team affirms that centralized exchanges are becoming “increasingly cumbersome” and are “unlikely to meet long-term trends.” However, Hotbit has noted that the only option is to become more decentralized or embrace regulation. Nonetheless, the crypto exchange has put the blame on the non-ending cyber attacks and the exploitation of the project defects by malicious users as reasons for its decline.

The Crypto Community’s Feedback on Hotbit Downfall

Various crypto community members have reported that they cannot withdraw their funds from the exchange. However, some have also cautioned the community members of the phishing links that may deceive to be Hotbit exchange on Google.

How do we withdraw when the withdrawal option has been disabled? Please enable withdrawal so we can withdraw our assets https://t.co/gXlGpR4hOV

— laith (@laith2762) May 22, 2023

Huobi Ceases Operations

Meanwhile, Huobi Global faces significant penalties from the Securities Commission Malaysia (SC). The SC accused Huobi of running an unauthorized digital asset exchange within Malaysia’s jurisdiction. This has led to SC ordering the platform to cease all operations, disabling its mobile and web applications, and halted all promotional activities targeted at Malaysian investors. The CEO has been tasked explicitly with ensuring these directives’ execution.

These events underline the increasing regulatory scrutiny and operational challenges that the centralized cryptocurrency exchanges are facing globally.

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