Hotbit ceases operations as centralized exchanges are becoming ‘increasingly cumbersome’

Shanghai-based cryptocurrency exchange – Hotbit – announced its decision to cease all its operations with effect from May 22.

The team behind the platform believes that centralized exchanges are “becoming increasingly cumbersome.” It further said that highly complex and interconnected businesses are difficult to manage, whether for compliance or decentralization, and are “unlikely to meet long-term trends.”

• The crypto exchange explained that the steady decline of large centralized institutions has prompted the industry to either embrace regulation or become more decentralized. This change in trend in the crypto industry is a significant factor that has prompted it to shut shop.
• in the blog PostHotbit informed its users to withdraw their remaining assets before June 21 this year, saying that its decision was based on other reasons as well.
• The platform also attributed the deterioration of operating conditions as a result of a series of crises that followed, including the FTX collapse and the bank crisis that led to USDC off-peg events.
• These events led to a steady outflow of funds from CEX users, including Hotbit.
• The announcement comes nearly a year after the platform halted its trading, withdrawals and deposits after law-enforcement authorities froze some of its assets in connection with alleged criminal misconduct by a former employee.
• Hotbit has repeatedly suffered from cyber attacks and project flaws exploited by malicious users that caused significant losses. Because of this, the team said that its current operating model of supporting a wide variety of assets is unsustainable from a risk management perspective.

Shanghai-based cryptocurrency exchange – Hotbit – announced its decision to cease all its operations with effect from May 22.

The team behind the platform believes that centralized exchanges are “becoming increasingly cumbersome.” It further said that highly complex and interconnected businesses are difficult to manage, whether for compliance or decentralization, and are “unlikely to meet long-term trends.”

• The crypto exchange explained that the steady decline of large centralized institutions has prompted the industry to either embrace regulation or become more decentralized. This change in trend in the crypto industry is a significant factor that has prompted it to shut shop.
• in the blog PostHotbit informed its users to withdraw their remaining assets before June 21 this year, saying that its decision was based on other reasons as well.
• The platform also attributed the deterioration of operating conditions as a result of a series of crises that followed, including the FTX collapse and the bank crisis that led to USDC off-peg events.
• These events led to a steady outflow of funds from CEX users, including Hotbit.
• The announcement comes nearly a year after the platform halted its trading, withdrawals and deposits after law-enforcement authorities froze some of its assets in connection with alleged criminal misconduct by a former employee.
• Hotbit has repeatedly suffered from cyber attacks and project flaws exploited by malicious users that caused significant losses. Because of this, the team said that its current operating model of supporting a wide variety of assets is unsustainable from a risk management perspective.