Yet another crypto-related firm is closing its doors.
Hotbit, a cryptocurrency exchange established in 2018, has recently announced its decision to suspend all operations starting from May 22nd.
Consequently, the crypto exchange urged customers to withdraw funds by June 21st, 4:00 am UTC.
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The announcement reveals that Hotbit's operating conditions have been severely impacted since an investigation into a former team member commenced in August 2022.
At that time, the company halted a selection of services, including trading, deposit, withdrawal, and funding. In August, Hotbit revealed that its former employee, who left the company in April of 2022, was involved in a project that violated criminal laws. As a result, many Hotbit managers were called to testify.
Apart from this, Hotbit points to a series of unfortunate events within the crypto industry that have further exacerbated its decline.
Specifically, the crypto exchange mentions the collapse of FTX and the banking crises that led to the de-pegging of USD Coin (USDC), both of which have negatively impacted Hotbit's cash flow by causing continuous fund outflows from centralized exchanges.
On top of that, Hotbit attributed its decline to a series of cyberattacks and the exploitation of “project defects by malicious users.”
With its statement, Hotbit underscored its belief that centralized exchanges are becoming "increasingly cumbersome" and are not aligned with long-term trends.
According to the crypto exchange, the available solutions are to transition towards a more decentralized model or fully embrace regulatory norms.
Interestingly, the announcement has led to concerns within the community as several users reported difficulties withdrawing their funds from the crypto exchange.
While Hotbit's halt in operations signifies a significant shift in the crypto industry, users are urged to safeguard their funds by withdrawing promptly.