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Just recently, after the exchange paused cryptocurrency withdrawals, the trading platform Okex finally enabled digital currency withdrawals last Wednesday. Since then, the exchange seems to be experiencing an exodus of funds leaving, as onchain data shows Okex’s crypto-asset reserves like bitcoin, ethereum and tether have depleted considerably during the last ten days.
Over the years a number of exchanges have had issues and have worried customers by stopping deposits and withdrawals for a period of time. Okex joined the list of exchanges that have halted withdrawals, as the cryptocurrency trading platform with more than 490 crypto trading pairs paused withdrawals on October 16, 2020.
“One of our private key holders is currently cooperating with a public security bureau in investigations where required,” Okex said at the time.
While customers waited and complained on social media and crypto-related forums, regional reports claimed that Okex’s founder Mingxing “Star” Xu was taken away by the police.
Following more than a month of uncertainty, Okex announced the exchange would open up withdrawals again on November 26, 2020. The exchange also revealed a compensation and rewards program at the same time.
“For users who have made deposits, held tokens, or traded during the period in which withdrawals were closed,” the company stated. “Okex will put 20% of its total income from futures and perpetual swap transaction fees over the last seven weeks into an incentive fund that will be issued as a one-time payment to users based on their assets and transaction conditions.”
Onchain data stemming from the firm Cryptoquant indicates that customers are withdrawing funds in droves. For instance, back in August Okex was one of the largest exchanges, in terms of bitcoin (BTC) reserves, but has since seen a significant decline.
Cryptoquant data shows on November 25, the exchange’s 101,583 BTC reserves dropped to roughly 98k by December 4, 2020. Additionally, the netflow of stablecoins leaving the exchange in contrast to deposits has been massive.
For example, onchain data shows on November 25, Okex had around 275 million ERC20-based tether (USDT) and by December 4, the exchange only held 19 million tether. Percentage calculations show that the metric indicates over 96% of the USDT held by Okex has been withdrawn in as little as ten days’ time.
Although, according to a report written by the financial columnist Muyao Shen, a spokesperson for Okex believes there’s a discrepancy with Cryptoquant’s data.
“A spokesperson for Okex said Cryptoquant’s data did not match the firm’s internal records, but Okex has yet to provide their own figures,” Muyao Shen said on Thursday.
Statistics from the web portal Bituniverse, which displays an “Exchange Transparent Balance Rank,” shows Okex is currently the fifth-largest crypto exchange in terms of assets held in reserves.
The data sets Bituniverse displays are parsed from Peckshield, Etherscan, and Chain.info statistics. The Bituniverse stablecoin stats for Okex also show the data is almost the same as Cryptoquant’s aggregated count, as the app indicates Okex only has 20.2 million USDT under management on December 5, 2020.