Why are Bitfinex’s Fiat Deposits Temporarily Suspended?

Bitfinex is a cryptocurrency exchange that is operated by iFinex Inc., based in Hong Kong. The crypto exchange is currently the 4th largest digital currency exchange according to the Coinmarketcap, with a daily trading volume of $668 million. Back in 2016, Bitfinex fell victim to a hack attack that resulted in the loss of 119,756 bitcoins. Today, the sources of the news outlet the Block reported that Bitfinex has temporarily suspended all fiat wire deposits for the British pound, Japanese Yen, and Euro. This news could have added extra pressure on the bearish Bitcoin, which experienced a sudden drop last night.

The cryptocurrency exchange is yet to make an announcement about the situation. Meanwhile, on the social media platform Twitter, people have shared screenshots of their Bitfinex’s account, after an unsuccessful attempt to deposit funds in their account. According to the screenshot of @crytpoSqueeze, Bitfinex’s message says:

“USD Wire Deposits Temporarily Paused. We expect the situation to normalize within a week. We apologise for this inconvenience.”

AtoZMarkets’ team has reached out to Bitfinex’s media for a comment on the case, and we will update this post as soon as Bitfinex’s team replies.

Bitfinex Partners with HSBC

One of the reasons why the users of Bitfinex may not be able to deposit is due to the recent partnership with HSBC. Reported on the 6th of October, the head analyst at The Block, Larry Cermak stated that Bitfinex has partnered with HSBC, through a private account of Global Trading Solutions. Cermak also mentioned that “all EUR, JPY and GBP deposits are paused, but Bitfinex ‘expects the situation to normalize within a week’”.

Experts believe that the partnership between Bitfinex and HSBC will be beneficial in the long-term, as it can stabilise the operations of the crypto exchange, which in turn could have a positive impact on the overall cryptocurrency market.

Bitfinex Is Not Insolvent

The controversy started last week after allegations were made that the crypto exchange is facing insolvency issues. Following these allegations, Bitfinex prompted to release an official statement, denying the case. The statement of Bitfinex against the rumours reads as follows:

Bitfinex is not insolvent, and a constant stream of Medium articles claiming otherwise is not going to change this. As one of only a very few exchanges operating since 2013, with a small team and low operating costs, we do not entirely understand the arguments that purport to show us to be insolvent without providing any explanation about why. How any rational party can claim insolvency when the opposite is there for all to see is interesting and, once again, perhaps indicative of a targeted campaign based on nothing but fiction.”

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