Why You Should Not Use HITBTC Exchange

March 23, 2019 11:52 AM    Tobyy   By Tobyy
840
Why You Should Not Use HITBTC Exchange

Why You Should Not Use HITBTC Exchange

March 23, 2019 11:52 AM     Tobyy   By Tobyy
840

The negatively painted crypto exchange, HITBTC is once again under the spotlight for yet another alleged scam. There has been a significant outcry on social media platforms and in the crypto space about this particular exchange.

This time around, this outcry involves the bitcoin private BTCP being delisted from the HITBTC exchange platform. This has caused many traders with blocked withdrawal and no access to their funds on the platform.


Legal Matters Between HITBTC And BTCP 

According to the Bitcoin private team official statement, a sum of about $500,000 was paid to the platform to be among the digital currencies up for trade. The recent turnaround and coin-burn from the exchange platform have caused a lot of unjustifiable and unanswerable questions. This claim was further backed by legal actions that have been filed for a further actionable move.

In response to these claims, HITBTC explained that the delisting of the Bitcoin private (BTCP) was due to complications which were caused by the planned bitcoin burn which occurred a day after it was forecasted on 17th of February.

However, according to the published letter that was made public the day BTCP was delisted from the HITBTC platform, they allege that the HITBTC attempted some sort of extortion. This extortion on BTCP was as a result of unresolved issues from the planned coinburn.

Back in March of last year, BTCP was created because of a fork that occurred between ZClassic and Bitcoin. This came with a notification of a possible future coinburn in its published whitepaper. This notification came as a scheduled removal of unclaimed coins meant for removal or burn since the fork. The next day, HITBTC charged the BTCP team half a million for the listing of their coin on their exchange platform.

HITBTC then took to announce on twitter that the new coin BTCP was created as a resultant action of a fork. Users were, therefore, promised not to be affected by the coinburn. A day following the expected coinburn, HITBTC reportedly contacted BTCP asking for compensation of about 58,920 BTCP as expected loss from the coinburn. This was tagged as a form of user protection funds.

However, it is worth to note that the documents made public already stated that BTCP’s address will not be affected in case of the occurrence of any coinburn. This made it evident that the exchange should not be concerned with funds lost by its BTCP users. This situation should just not exist. From the published document, it pointed out that HITBTC secretly held on to the total requested compensation cost of 58,920 BTCP in a BTCP segwit private wallet.

On February 21, the HITBTC exchange again demanded that the BTCP team compensated them 58,920 BTCP or risk delisting of their crypto on the platform. HITBTC has since released a statement boldly stating that the BTCP team were unable to provide a safe platform to which funds were to be moved before the scheduled coinburn. They further pointed out that the exchange has compensated all custody loses. 


The Resulting Effect On The Platform's Users

This issue has affected a lot of traders as they have not been able to access their fund nor transact with their funds. Various users have been asked to submit their KYC and other credentials such as identity card number, account details, etc., but the issue is still yet to be resolved.

As seen on the Reddit platform, a HITBTC user is planning a class action against the HITBTC exchange platform for the unlawful holding of user’s funds. He claimed his funds have been locked up right after registration without any probable cause. The user is currently making a list of all the allegedly scammed users on the platform.


Some Other Accusations Against HITBTC

Another user has also voiced out frustrations like many others on when the trading account will be unblocked. They all have been complaining about this same issue which is the inability to gain access to their crypto funds. This is after they have complied with the requirements that were asked of by the crypto exchange platform.

Often times, the narrative is quite different from the feud between the HITBTC and BTCP. Some customers also complained about frozen accounts. One of the users complained that the transaction from the user’s account has been frozen and could not be accessed. There has been a number of trials to get the transaction done from the account to no avail.

The major point of complaints here is HITBTC withholding of user’s funds without proper jurisdiction. These actions are without given reasons and the users whose funds are withheld are not being able to transact. HITBTC, however, seem unconcerned as they have not given any form of a reply to the different cases of filed ticket cases.

HITBTC is also well known for its high rate which is tagged on all transactions. Their trading algorithms whale clog the trades made in the platform. This causes a ling waiting time for both withdrawal and deposit transactions. Sometimes, this lasts only hours while on other scenarios, it lasts for days before transactions are completed.


McAfee’s Take On HITBTC

Quite frankly, all these woes could be traced back to when the crypto godfather John McAfee complained about the high charges on their minimum buy-ins. This was as far back as 28th of June 2018. McAfee argued that the outstanding fee was more than the monthly income of low earning investors on the platform.

McAfee, who is a strong advocate for the complete elimination of centralized exchange authorities, usually stresses that the level of power they exert over users assets should be further decentralized to avoid issues like this. The further decentralization will give maximum freedom to crypto users on the blockchain network.

With a recent survey carried out in the crypto sphere, about 20% of the traders were satisfied with the services offered by HITBTC. While 80% of the users were not satisfied with their services.


In Conclusion

The lawsuits are not yet granted any appropriate response by the crypto exchange platform. They are instead looking at expanding their crypto exchange services to add recently created digital currencies to their exchange platform. What next then? We just have to wait and see.

Updated 02:00 PM UTC+8, 20 Aug 2019

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