On the morning of October 16th, digital asset exchange OKEx suddenly froze withdrawals from the platform.
The exchange announced at the time that one of its “private key holders” was currently “cooperating with a public security bureau” due to ongoing investigations. Due to said investigations, which purportedly involved a personal matter, the holder was unable to sign transactions for withdrawals.
Eleven days after this announcement, on October 27th, withdrawals remain frozen.
In an announcement revealing an update to its WebSocket System, OKEx asserted that its staff remains committed to “doing the maximum to resolve” the withdrawal issues “as quickly as possible.”
“Withdrawals on OKEx are still paused. The security of user funds is our top priority. All user funds remain safe and unaffected. We are doing everything we can to ensure that the platform returns to full functionality.”
Days earlier, OKEx asserted that “all products are up and running except those that directly involve withdrawals.” The platform resumed its peer-to-peer trading service on October 20th, as that service does not require the withdrawal of coins from centralized holdings. There was speculation online that the peer-to-peer service, which caters to the Chinese audience, was responsible for the “investigations.”
Digital asset analytics firm Glassnode reports that the exchange likely holds 200,000 bitcoin, currently valued at approximately $2.75 billion. The exchange likely holds hundreds of millions more worth of other digital assets, especially stablecoins.
No funds have been moved from the exchange’s known Bitcoin addresses since the original announcement on October 16th, on-chain analysts have said.
It can be surmised that the unnamed private key holder remains unavailable to sign withdrawals, meaning coins on the exchange are stuck in limbo for the time being. Local Chinese media, namely the outlet Caixin, have reported that the holder is potentially Xu Mingxing, better known as Star Xu.
These reports have not yet been substantiated.