OKEx exchange has suspended the withdrawal of cryptocurrencies, and institutions may cause a shortage of bitcoins in the market
OKEx has suspended the withdrawal of cryptocurrencies
OKEx, the world’s second-largest crypto exchange, has suspended the withdrawal of all cryptocurrencies for an indefinite period.
The platform representatives said that one of the private key holders “ currently cooperating with a public security bureau in investigations/” OKEx plans to resume withdrawals of digital assets “immediately” as soon as the key holder “can authorize the transaction.” OKEx said it decided to suspend withdrawals under the terms of service, but added that these events “will not affect” the security of customers’ assets.
The head of the exchange, Jay Hao, noted that the cooperation of the key holder with officials is associated with a “personal problem” and the investigation will not affect the business. Chinese media Caixin reported that OKEx co-founder Star Xu was detained by the police at least a week ago and has not been seen since.
Institutions can cause bitcoin shortages in the market
In recent months, there has been a significant surge in demand for bitcoin from institutional investors. 10T Holdings co-founder Dan Tapiero believes this could lead to a BTC shortage over time.
Along with investments in bitcoin from Square, MicroStrategy and Stone Ridge, the investment fund Grayscale reported record inflows.
In the third quarter of 2020, the company’s bitcoin trust received $1.05 billion in investments. This marked the first quarter with over $1 billion in investments, which indicates record high demand from institutional traders. Based on these data, the fund buys about 77% of all coins mined by miners.
“Shortages of Bitcoin possible. Barry’s Grayscale Trust is eating up BTC like there is no tomorrow. If 77% of all newly mined turns into 110%, it’s lights out. Non-miner supply will get held off market in squeeze. Shorts will be dead. Price can go to any number, ” said the businessman.