Home Crypto News KuCoin CEO Denies Withdrawal Freeze Rumors

KuCoin CEO Denies Withdrawal Freeze Rumors

by Cryptoroz

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Key Takeaways

  • KuCoin is rumored to be going through insolvency points within the fallout from Three Arrows Capital’s collapse.
  • The agency’s CEO has denied the claims, saying that “all the pieces on KuCoin is working nicely.”
  • The event follows a wave of crypto corporations halting buyer withdrawals in response to excessive market situations and the Three Arrows disaster.

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The rumors surfaced hours after Voyager Digital introduced it was freezing buyer withdrawals amid the continued Three Arrows Capital disaster. 

KuCoin Working as Regular, CEO Insists 

Rumors that KuCoin could possibly be getting ready to collapse are unfaithful, in accordance with the agency’s CEO. 

Johnny Lyu addressed hypothesis that the agency could possibly be going through insolvency in an early Saturday tweet storm, affirming that “all the pieces on KuCoin is working nicely” and the trade had no plans to halt withdrawals. Lyu additionally described the circulating chatter about KuCoin’s doable liquidity points as “sheer rumors” and confirmed that the agency has no publicity to the Terra ecosystem, Three Arrows Capital, or Babel Finance. 

Rumors of KuCoin’s inside issues surfaced late Friday, hours after Voyager Digital turned the domino to fall as a part of crypto’s ongoing Three Arrows saga. Voyager introduced Friday that it was halting buyer withdrawals, deposits, and buying and selling and “exploring strategic options” for the way the corporate might transfer ahead. Final month, it was revealed that Three Arrows had defaulted on a mortgage of 15,250 Bitcoin and 350 million USDC price round $665 million from Voyager. Three Arrows is but to make the repayments. 

KuCoin raised $150 million in a funding spherical in Could, valuing the agency at $10 billion. As Lyu famous in his Saturday announcement, the agency can be actively hiring regardless of the continued market hunch. Lyu added that “being clear is at all times one in every of [KuCoin’s] key rules” and closed his publish with a optimistic word: “Don’t FUD, BUIDL.” 

The Three Arrows Disaster 

Till the disaster started to unfold in early June, Three Arrows was one in every of crypto’s largest hedge funds holding greater than $10 billion in belongings beneath administration at its peak. Because the crypto market plummeted, it got here to mild that the agency was going through main liquidity points because it had taken on leverage from crypto lenders with out factoring for a big downturn. The agency’s co-founder Kyle Davies mentioned that it had misplaced $200 million on its Terra guess when LUNA crashed in Could, and a number of crypto lenders have since revealed that that they had publicity to the agency. BlockFi loaned Three Arrows an undisclosed sum and has since inked a deal to be acquired by FTX.US for as much as $240 million with a further $400 million rolling credit score facility. Babel Finance, CoinFLEX, and Celsius additionally responded to the market downturn by halting withdrawals, although none of them confirmed that that they had Three Arrows publicity. On Friday, the troubled hedge fund filed for Chapter 15 chapter in New York. 

Although the complete scale of the Three Arrows disaster stays unknown, a number of corporations have been laborious hit to this point, and the market hasn’t proven a lot signal of life within the fallout. Bitcoin tumbled once more Saturday after per week of rocky worth motion. It’s at the moment buying and selling at $19,260, about 72.1% down from its $69,000 peak. 

Disclosure: On the time of writing, the writer of this piece owned ETH and a number of other different cryptocurrencies.

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