OKEx users move cryptocurrencies off the exchange while resuming withdrawals

November 25, 2020 Coin Payment

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After a five-week suspension of all user withdrawals, cryptocurrency exchange OKEx resumed normal services at 8:00 UTC on November 26th.

Having announced the reopening last week, OKEx then indicated that it would launch a compensation and rewards program to express its gratitude to customers for resisting during the outage.

These programs include Tether-denominated commission redemption cards (USDT), a one-time compensation payment based on users’ asset and transaction histories, and a doubling of the asset weight calculation for holders of the exchange’s native token, OKB .

Despite these efforts, today’s data shows that the programs have not been enough to prevent users from withdrawing their funds, having apparently lost faith in the exchange.

While withdrawals haven’t been open long, some initial revealing data is emerging on social media transaction trackers. Mason Jang, the chief operating officer of Crypto Quant, tweeted:

More data from CryptoQuant shows that “the first outflow of OKEx after opening the withdrawal reached 2,822 BTC within the block time period”, which is “the year high in the block time period”:

Total 10-day Bitcoin outflow for OKEx Source: Twitter

Cryptographic monitoring service also Whale Alert traced at least a couple of high value transactions within one hour of opening withdrawals:

As reported, OKEx had suspended withdrawals on Oct. 16 while one of the exchange’s private key holders cooperated in an investigation conducted by the authorities and was therefore unable to authorize transactions within the hot wallet system.

The exchange said it was not involved in illegal activities, although there were reports that its founder, Star Xu, had been questioned by the police that same week.

The sudden suspension of the withdrawal in mid-October caused significant volatility in the markets at that time, resulting in a 3% drop in the trading price of Bitcoin (BTC).

With the outflows continuing from the exchange to other exchanges and portfolios, bearish sentiment is circulating in the market. BTC / USD just lost support at $ 17,000, signaling its biggest losses since March.