Bitfinex suspended fiat deposits on the platform amidst claims of insolvency. The popular cryptocurrency exchange platform says deposits should resume in a week’s time.
EUR, USD, JPY, and GBP Wire Deposits Suspended
According to several reports on social media platforms, Bitfinex suspended all fiat wire deposits on the platform. Different Bitfinex users took to Twitter and Reddit to post screenshots showing the suspension order on the website which said:
USD wire deposits temporarily paused. We expect the situation to normalize within a week. We apologize for this inconvenience.
Many observers say the development is part of a larger crisis within the exchange caused by issues with its banking relationship with HSBC. According to sources at The Block, it appears that Bitfinex’s account with HSBC is inactive, hence the reason for the fiat deposit suspension.
Cryptocurrency Exchange Faces Banking Crisis
The banking brouhaha will likely intensify the rumors circulating about Bitfinex’s insolvency. Recently, Live Bitcoin News reported a rebuttal of those rumors by the platform. At the time of the Noble Bank crisis, the platform assured its users that their operations wouldn’t be impacted in any way.
The decision to suspend fiat deposits coming on the heels of Noble Bank going under might suggest a crisis for the popular cryptocurrency exchange platform. For one thing, it leaves Bitfinex without a fiat deposit lifeline. Given the generally negative disposition of banks towards virtual currency businesses, resolving the problem in one week would be an admirable feat by the platform.
Fluctuating Bitfinex Tether and Bitcoin Wallets
Meanwhile, reports suggest massive fluctuation in Bitfinex’s Tether (USDT) and Bitcoin (BTC) wallets. Reportedly, 110 million USDT left the exchange on October 10th.
Bitfinex, which has the second-richest Tether wallet, is showing the movement of large Bitcoin sums ending up in Bittrex wallets and other cryptocurrency exchanges. These BTC transactions all move via privately-held wallets.
For any cryptocurrency enthusiast, the fear is that a failure occurring in a platform like Bitfinex could have far-reaching implications for the entire cryptocurrency market. Liquidity problems for Bitfinex could adversely impact the effective price of USDT.
Despite the many assurances from the platform’s team, the situation appears to be devolving. Hopefully, Bitfinex keeps its word and resumes operations in a week’s time as promised.
Do you think there is more going on behind the scene at Bitfinex? Let us know your thoughts in the comment section below.
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