FTX-owned crypto exchange Liquid Global has announced that it is suspending all crypto and fiat withdrawals as the FTX collapse continues to affect the markets.
FTX acquired the Japan-based crypto trading platform and its subsidiaries earlier this year.
Halting All Withdrawals
The ongoing crisis faced by centralized exchanges continues, as Japanese cryptocurrency exchange Liquid Global announced that it is halting all deposits and withdrawals, including fiat. The Japan-based exchange and all its subsidiaries had only just been acquired by FTX as recently as February 2022.
Liquid Global announced on their official Twitter handle, stating,
“Fiat and crypto withdrawals have been suspended on Liquid Global in compliance with the requirements of voluntary Chapter 11 proceedings in the United States. Until further notice, we would suggest not to deposit either FIAT or Crypto.”
The exchange added that it would provide users with further updates as and when they are available and stated that the suspension is not related to any security-related issue. FTX had given Liquid a $120 million loan in 2021 after the exchange was the subject of a crippling $90 million hack. After extending this loan, FTX agreed to purchase the exchange outright.
QASH Token Plummets
The Liquid Exchange was among the first cryptocurrency exchanges to be fully licensed by the Japan Financial Services Agency. Additionally, it had also applied for a license with the Monetary Authority of Singapore. The platform also features a utility token, QASH, that users can use to avail of discounts on exchange fees. Following the news, QASH plummeted 25%.
The announcement to halt all withdrawals and deposits came after the exchange claimed that the FTX collapse did not impact customer assets on Liquid. Liquid stated in a tweet,
“We have conducted initial checks and see no unusual activity.”
However, Liquid announced an immediate suspension of withdrawals on Liquid Global, calling it a precautionary measure put in place until additional security checks are completed.
FTX Collapse Reverberates Across Markets
The collapse of the FTX exchange has become a significant talking point, both in and out of crypto circles. The collapse saw FTX and its associated trading company, Alameda Research, saw Sam Bankman-Fried’s crypto empire collapse in days after a report revealed an estimated $10 billion hole in its finances, which spooked an already troubled crypto market.
Liquid halting withdrawals sees the company join a host of others that recent events have adversely impacted. Crypto lending and trading platform, BlockFi had also announced that it was pausing withdrawals thanks to its FTX exposure. Sino Global Capital, a crypto venture firm, also announced a significant seven-figure exposure to FTX. Crypto investment and trading group CoinShares also revealed that it had a $30 million exposure to the bankrupt exchange.
Additionally, court documents have shown that over a million creditors have claims against the exchange.
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Sourced from cryptodaily.co.uk.
Written by Amara Khatri on 2022-11-16 09:10:00.