Hotbit cryptocurrency exchange announced on May 22 that it would cease operations. The exchange has requested that all its users withdraw their funds before June 21, 2023.
The exchange stated in an announcement that its operating conditions have deteriorated since a former team member was investigated in August 2022. According to the exchange, the investigation caused the company to cease operations for weeks.
In addition, Hotbit cited several crypto-related incidents as contributing to its decline. The exchange cited the FTX collapse and the banking crises that led to the USD Coin depegging as reasons for its declining currency flow. According to Hotbit, the incidents caused a continual outflow of funds from centralized exchanges.
Additionally, the Hotbit team believes centralized exchanges are becoming “increasingly cumbersome” and “unlikely to meet long-term trends.” According to the exchange, the only options are to become more decentralized or adopt regulation.
The exchange also cited repeated cyberattacks and “project defects exploited by malicious users” as contributing factors to its demise.
Several community members reported that they could not extract their funds from the exchange as the announcement was made.
Some community members were also warned about phishing URLs that pose as the official Hotbit exchange on Google.
While Hotbit is closing its doors, other exchanges continue to operate, with some launching initiatives to address problems in the cryptocurrency industry. Recently, Coinbase cryptocurrency exchange published a campaign to “update the system.” OKX has gone further; it intends to “rewrite the system.”
