One of the largest crypto derivatives exchanges in the world, OKEx has finally resumed its operations after an abrupt suspension of its operations last month. In a blog post on Thursday, the exchange confirmed that they had lifted the withdrawal freeze and they are now working towards compensating their clients who were left disgruntled and stranded by the whole debacle. Problems for OKEx had begun on 16th, October this year, when it suspended customer withdrawals on its platform. The company had explained at the time that one of its private key holders was cooperating in criminal investigations with a public security bureau.
The exchange also informed its clients that they had been unable to reach the holder due to which they couldn’t process authorized withdrawals. The exchange cited its terms of service and suspended all withdrawals via its platform. Even though it did reassure the public that all customer funds were safe, it still prompted concerns because the company was moving funds. Whale Alert, the asset movement tracker had confirmed that outgoing transfers made from the exchange included 1,180 BTC, 21,000 ETH, and 50 million TRON tokens, which were all worth a value of $35 million at that time.
Likewise, there were also incoming transactions on the exchange of about $13.9 million Tether tokens. A few days after the freeze was implemented by OKEx, it was confirmed by news sources that one of the exchange’s officials had been taken into police custody. It was reported that one of the exchange’s co-founder, Mingxing ‘Star’ Xu, had been questioned by the police. The location of the questioning was not revealed. As the divisional office of the exchange is only located in Hong Kong, it was unclear whether the questioning took place there or in OKEx’s home of Malta. Likewise, there was no report of whether he was still in custody.
It had been reported by Colin Wu that the case was related to a money-laundering investigation. Wu said that the Chinese government was cracking down on the use of crypto in money laundering, which puts centralized exchanges in a very risky position. However, his statement was contradicted by a Mars Finance account, which said that Xu had been questioned regarding a backdoor listing for OKEx’s parent company, OK Group, last year in Hong Kong. The report also said that OKEx had cut their ties with Xu and the exchange claimed that it hadn’t worked with the co-founder for a long period of time.
During all this time, customers were scrambling to figure out what was going on. The silence of the exchange certainly made things worse. It appears that OKEx is now ready to provide compensation to its users. Last week, the exchange had announced its return and explained that it would launch a loyalty and rewards program, as an apology for its radio silence. The loyalty program that has been introduced features issuance of debit rebate cards, discounts, and more. The rules and criteria of the program have been explained in detail in a blog post.
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