OKEx CEO Arrested in China

OKEx CEO Arrested in China 1024 500 Crypto Rand Group
OKEx ceo

According to the local Chinese press, Xu Mingxing, CEO of the OKEx crypto stock exchange, was arrested on 16 October by the police. About 1.1% of the Bitcoin in circulation is now frozen on the exchange’s wallets.

On 16 October, OKEx, one of the 5 largest exchanges in the world with more than 6 billion dollars of trading per day, announced the closure of crypto cash withdrawals. And the company is unable to say when operations will be able to resume.

In a terse message, the crypto stock exchange merely indicated that a private key holder was no longer reachable. The latter is cooperating with an investigation by the authorities. According to reports in the Chinese press, it is now known that it is Xu Mingxing, the founder of OKEx.

OKEx’s CEO with the police, but not for money laundering

Rumors attributed the questioning to investigations in the context of a money laundering case. However, an OKEx spokesperson denied this hypothesis to Coindesk.

“We are not free to discuss any matter under investigation, but we can reveal that it is not in any way related to the fight against money laundering or to OKEx,” he says.

As Decrypt points out, this is not the first time Xu Mingxing has been heard by the police. In September 2018, he was cooperating with the authorities on charges of fraud involving a low capitalization crypto-money.

After the proceedings against the BitMEX exchange in the United States, the forced shutdown of OKEx is a severe blow to the crypto market. Even more so since the platform was one of the most active to date.

200,000 Bitcoins stuck on OKEx wallets

The daily trading volume on OKEx exceeded $6 billion. In addition, notes Glassnode, the exchange holds around 200,000 bitcoins in its wallets, which represents a value of almost 2.3 billion dollars.

This is approximately 1.1% of the Bitcoin in circulation. However, for customers who hold this asset in a wallet on OKEx, this money is unavailable until withdrawals are reopened. This prospect is unknown at the moment.

However, Glassnode is still observing Bitcoin withdrawals in the two days following the arrest of the OKEx CEO – but prior to the closure. “According to our data, a total of 10,000 BTCs (~$113 million) were withdrawn in two large batches in the last 48 hours,” Glassnode tweeted.

Other reports indicate that some bitcoin continues to flow out of the exchange to other exchanges. However, WhaleAlert suggests that these may be internal transfers.

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