News Customers Angry as bitFlyer Holds Funds During Account 'Re-examination'

Customers Angry as bitFlyer Holds Funds During Account ‘Re-examination’

-

- Advertisment -

Customers Angry as bitFlyer Holds Funds During Account ‘Re-examination’

Customers Angry as bitFlyer Holds Funds During Account 'Re-examination'

BitFlyer’s Japan-based account holders are becoming concerned — the popular exchange has now frozen deposits and withdrawals to several customers for over a week, causing anger and frustration. The company has also stayed mostly quiet and hasn’t posted updates or explained the issues in detail, conjuring bad memories of 2014’s Mt. Gox fiasco.

Also see: Michael Terpin on ICOs: ‘We’re Big Fans of What They’ve Done in Singapore’

Subscribe to the Bitsonline YouTube channel for great videos featuring industry insiders & experts

Not a Mt Gox Repeat, but a Similar Nervous Feeling

To clarify, no-one is suggesting bitFlyer has lost any funds, crypto or fiat. The delays are likely due to ever-stricter regulatory requirements for digital asset businesses in Japan.

The problem became visible just over a week ago when, without notice or warning, bitFlyer froze deposits and withdrawals in both crypto and JPY. Some users, who had sent digital assets to their accounts and received a confirmation of receipt email, reported they only heard of the issue when the balance was never reflected in their main wallets. Some deposits were marked as pending, while one user claimed the amount vanished after appearing as pending for a few days.

Still no explanation appeared in public. A day later, customers who sent individual support queries started receiving replies saying bitFlyer was now “re-examining account information”, and that they should expect delays. No timeframe was specified, and subsequent responses said bitFlyer was “not sure when the verification process will be done”.

Some customers reported bitFlyer claimed there was a discrepancy between their identity documents and the account information on file — despite having already completed approval, and not changing anything since opening the account. BitFlyer and other exchanges had previously mailed physical postcards to all users in order to verify address accuracy.

What’s Causing the Delays, and Silence?

The delays are most likely due to a “business improvement order” issued to bitFlyer and five other Japanese exchanges in late June 2018 by regulator the Financial Services Agency (FSA). The catalyst was reported to be shortcomings in anti-money laundering (AML) practices found at the exchanges.

Some of the exchanges have halted new signups, and were told to strengthen their AML procedures. However, existing verified customers said they assumed this would be an internal matter, and the exchanges would work with the FSA in the background — not freeze access to much-needed funds for an indefinite period for account “re-examining” without warning.

It’s the lack of information and communication that has frustrated customers most. While many crypto enthusiasts would be happy to direct their anger at government agencies for creating bottlenecks, some told Bitsonline they wouldn’t have sent deposits to bitFlyer had they known what would happen.

BitFlyer Wanted to Be a Compliant, Professional Exchange

bitFlyer began operating in 2014, one of the first exchanges to open in Japan since the Mt. Gox shutdown in February that same year. It is famous for its colorful TV commercials and poster ads, and has been credited in the past with making bitcoin and cryptocurrency use more acceptable to the mainstream public.

Contrasts between bitFlyer and Mt. Gox couldn’t be starker — its founders and team were seasoned finance professionals, like CEO Yuzo Kano and several key staff members he recruited from big-name Wall St firms.

The exchange has always performed bank-style KYC identification procedures on new customers, which should have caught any problems if done properly.

Delays, Lack of Information the Biggest Problems

Lack of satisfactory explanations or updates from the exchange, and vague responses like “we don’t know when your account will be verified” are causing dismay and anger among bitFlyer’s user base.

The company has a Twitter account, which has only posted twice in the past nine days, both of which referred to routine maintenance — and the account has not replied to any of the numerous tweets of complaint from users.

Google Translation: “We will inform you that the maintenance which had been carried out from 4:00 am on June 29, 2018 was over. Currently, both bitFlyer Lightning (including API) and Bitcoin simple exchanges are available as usual. I apologize that the end time has been delayed from the schedule.”

“@ bitFlyer The situation has not changed, no reply, no payment reflected, all none. Today is a holiday. Everyone, including the president @ Yuzo Kano, @ bit Flyer, weather is nice and it will be slow.”

Translation: “Reflection of payment is too slow, please return money.”

That bitFlyer is withholding access to funds that haven’t even touched its exchange is particularly galling — customers sent money from private wallets all week that simply went into purgatory. Support has not responded to demands to return the unused money, or explained why access to deposited funds was removed while the re-examination takes place.

Another customer told Bitsonline they sent BCH to their bitFlyer account just yesterday, having not heard of the problems. It was instantly frozen. For those needing access to money and accustomed to bitFlyer’s usual quick turnaround times, such action could cause hardship.

There are already hints that some are preparing a repeat of the doorstop protest stunt that turned Mt. Gox into a meme back in 2014 — though bitFlyer’s more sophisticated management is less likely to turn up in the snow holding a large frappuccino.

Do trading exchanges have a duty to better inform and update users at times like this? Tell us what you think in the comments.


Images via bitFlyer, Twitter, Pixabay



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Make Fast and Secure Trades Using Bitengo.io

Bitengo.io is a Cryptocurrency trading platform that allows users to buy and sell their Cryptocurrency in a...

Network Security Using Cryptography: Everything you need to know

This article will describe what is Network Security Using Cryptography and everything you need to know before...

Mercuriex Cryptocurrency Exchange Launches New Utility Token, SURF

MercuriEx Cryptocurrency Exchange, originally developed in 2017, came under new ownership in December 2019. Since taking over the exchange,...

Fungibility: Bitcoin Mixers Favorite Term That No One Understands

Fungibility, perhaps the most important concept when dealing with a decentralized and anonymous currency, but does bitcoin...
- Advertisement -Customers Angry as bitFlyer Holds Funds During Account 'Re-examination'

Crypto can’t thrive in the real world – but stablecoins can

We can safely say that the hype about cryptocurrencies is pretty much over. The claims of Bitcoin...

How to double your crypto

Most of us have a small gambler deep inside our souls. We love to feel the thrill...

Must read

Make Fast and Secure Trades Using Bitengo.io

Bitengo.io is a Cryptocurrency trading platform that...
- Advertisement -Customers Angry as bitFlyer Holds Funds During Account 'Re-examination'Customers Angry as bitFlyer Holds Funds During Account 'Re-examination'

You might also likeRELATED
Recommended to you