29 November 2019 | AtoZMarkets – In the past few days, China has been increasing pressure on crypto exchanges operating within its jurisdiction. The move by the authorities now appears justified as IDAX crypto exchange suspended deposits and withdrawals after its CEO purportedly vanished.
IDAX CEO is missing
In an official blog post on November 29, IDAX said that the whereabouts of Lei Guorong were at present unknown. The cryptocurrency exchange had earlier in the week warned that it was seeing a run on withdrawals.
According to the blog post:
“Since we have announced the announcement on November 24, IDAX Global CEO has gone missing with unknown cause and IDAX Global staffs were out of touch with IDAX Global CEO.”
Multibank ReviewT&Cs apply, 18+eToro Review74% of retail investor accounts lose moneyCapital.com Review76% of retail CFD accounts lose moneyIDAX Global suspends deposits/withdrawals as its CEO has gone missing. The company was allegedly based in Shanghai https://t.co/DU1H09QXrl
— Larry Cermak (@lawmaster) November 29, 2019
It continues to read that the company’s cold wallet was on lockdown as a routine precaution to protect the user funds. The cold wallet is used to store almost all crypto balances on IDAX. Thus, it was restricted after the CEO went missing meaning that all deposit/withdrawal services cannot be provided.
IDAX never linked Lei directly to the cold wallet access. Also, it did not suggest that users’ money was in any way at risk.
Security issues or another exit scam?
At the moment, it is still unclear what could happen with the funds on the exchange. Nevertheless, this negative trend has got many in the crypto community to ask where is IDAX CEO? Some people are even calling it another “exit scam,” referring that the CEO has allegedly run away with the cold wallet’s private keys. Others appear more reserved in their opinions and are actually comparing it with the hack of UPbit.
As AtoZMarkets reported this week, the South Korean cryptocurrency exchange confirmed that hackers had stolen 342,000 Ethereum. It’s worth noting that the CEO of the company operating the exchange said that they will cover all lost assets.
In a similar development that occurred earlier this year, Gerald Cotten the CEO of Canadian cryptocurrency exchange QuadrigaCX reportedly passed away. He also took the company‘s private keys and $134 million worth of cryptocurrency with him.
From the foregoing, this seems like another case of CEO running away with all the money', but let's hope it's not. Nevertheless, this is a developing story and AtoZMarkets has reached out to IDAX for commentary. However, we have not received any comment from the company yet. We will update this article as comments are received.
What do you think about IDAX's missing CEO? Let us know what you think in the comments section below.