OKEx has denied that it uses a single signature cold wallet to house the funds on its platform, contrary to reports by a local Chinese website.
OKEx has halted withdrawals since October 16, after its founder was arrested by authorities. Since then, customers have grown increasingly worried over when their funds will be available to them.
Even though OKEx has allayed fears and told them their funds are safe, it is only a matter of time before customers finally get tired. In this vein, a Chinese blockchain platform, Jinse Caijing, said that the latest withdrawal issues witnessed by the crypto exchange platform are because it uses a single signature cold wallet.
OKEx says withdrawal issues are a result of security policies
However, OKEx has come out to rubbish the blockchain websites report, blaming their withdrawal woes on the company’s security policies. The story, which was first seen by Matthew Graham, CEO of Sino Global Capital, has an iota of truth.
Around the same time that withdrawals were paused on OKEx coincided with when the exchange founder, Xu Mingxing, who holds a private key, was arrested. Even though users are still keeping their frustrations under wraps, they do not know when withdrawals will resume.
When contacted on an update regarding the issue, a spokesperson of OKEx said he could not reveal any information that will put user’s funds at risk. The publication by Jinse Caijing is, however, not a real story but just fabricated thoughts.
Matthew Graham later took to Twitter to announce that he would delete the original post because it might be photoshopped. “I’m deleting this tweet because it may be photoshopped. I’m sorry about the FUD,” Graham said. Jinse Caijing has also deleted the post from its website.
95% of total funds are stored in various cold wallets
When asked if OKEx uses a single signature Bitcoin wallet, the spokesperson talked about the recent Ethereum Classics 51% attack, which occurred in August. He spoke about the withdrawal process, including its semi offline multi-signature for hot wallets.
The report released showed that about 95% of the total funds are stored in various cold wallets. On a page that talked about cold wallet security, the Advanced Encryption Standard password is in the care of two executives of OKEx. One of the executives is located in their office in Beijing, and the other executive is located in the United States.
To make a withdrawal from OKEx, a staff member goes to “the bank safe near the office and retrieve[s] the appropriate number of unused encrypted private keys.” They then scan the keys’ QR code into two separate offline computers. Then “the holder of the AES master password decrypts the encrypted private key on a completely offline computer” before scanning the QR code into another offline computer.
According to the report, the final step is the “signing trading on another computer completely offline, and after the transaction, signature synchronized to a computer with internet broadcast transaction through USB drive.”
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