A cryptocurrency exchange called CoinList has responded to “FUD” after a blogger alleged users were unable to withdraw funds for over a week, leading to speculation that the company is insolvent or has liquidity issues.
The reason behind the difficulty in withdrawing the fund
According to Colin Wu, a cryptocurrency blogger with 245,000 followers, users of CoinList have not been able to withdraw for over a week because of maintenance.
“Some community members reported that Coinlist, the largest cryptocurrency crowdfunding platform, was unable to withdraw coins. The official reason is that the custody partner is undergoing maintenance, but it has lasted for more than a week. Coinlist incurs $35M loss in 3AC crash,” he said on Twitter.
Some community members reported that Coinlist, the largest cryptocurrency crowdfunding platform, was unable to withdraw coins. The official reason is that the custody partner is undergoing maintenance, but it has lasted for more than a week. Coinlist incurs $35M loss in 3AC crash
— Wu Blockchain (@WuBlockchain) November 24, 2022
In an announcement, CoinList explained that its internal systems are being upgraded, and wallet addresses are being migrated across “multiple custodians.”
“We are upgrading our internal ledger systems and are migrating wallet addresses involving multiple custodians. This is one of many efforts we are undertaking to offer our customers around the world better products and services while maintaining compliance,” said CoinList.
The unnamed custodian partners experiencing an outage
1/ There is a lot of FUD going around that we would like to address head on.
CoinList is not insolvent, illiquid, or near bankruptcy. We are experiencing technical issues that are affecting deposits and withdrawals.
— CoinList (@CoinList) November 24, 2022
Unknown “custodian issues” have caused a selection of cryptocurrencies to take longer than expected to migrate, according to the company, with a custodian partner suffering from an “outage” on November 23. Tokens on the platform were impacted on 23.
“As with any big undertaking, there are bumps along the way. Custodian issues mean some tokens are taking longer than anticipated to migrate (ROSE, CFG, FLOW, MINA). One of our custodians had an outage yesterday unrelated to the migration that impacted many tokens on CoinList.”
The firm could, however, be Anchorage, Bitgo, Gemini Custody, or Silvergate Bank, which are Coinlist’s custody partners, according to Wu.
Recently, Gemini’s Gemini Earn service froze withdrawals after Genesis Global Capital, one of Barry Silbert’s Digital Currency Group subsidiaries, had issues.