HitBTC are apparently not the only ones who are “failing” the Proof of Keys event today. The event is intended to prove the Bitoin solvency of each exchange. Every user is encouraged to withdraw all Crypto to private keys that they control. However, according to Trace Mayer and the Proof of Keys’ event’s official page, , several exchanges leading up to or on the day of the event (today).
Not All Exchanges Actually Caught
Not all of the exchanges listed in the “failures” section of the official Proof of Keys site are currently having withdrawal issues. Coinbase pointed out that the issue reported back at the end of December was fixed not long after it was initially reported.
Service was restored at 19:30 PT, 1 hour after the original incident
— Coinbase Pro (@CoinbasePro)
was back up and running about an hour after it reported outages this morning:
We are back online. There was an issue with the order gateways during an upgrade, and have worked quickly to fix. We apologise and thank you for your patience
— Bitfinex (@bitfinex)
HitBTC has failed to comment via Twitter about ongoing withdrawal issues within it. As the below video, which was linked in lieu of CCN’s reporting on the Proof of Keys site, points out, HitBTC may actually have solvency issues:
, which is not an exchange but allows people to acquire and use Crypto via Amazon Prime, has not responded to the following “withdrawal issue” a user is experiencing:
It looks like has impacted somehow. They have halted withdrawals without reasonable explanation. 🔑
— Senior Crypto (@crypto_senior)
Clearly, some extra details on this issue would be interesting, such as the amount of Crypto being withdrawn. Even a small Crypto business would be capable of faking it with a small amount of cryptocurrency. Questions arise when large withdrawals are denied or “issues” arise around them.
Proof of Keys Not Yet Impactful Enough to Measure Solvency
Ultimately, for the full weight of the probing event to be felt by trusted third-party cryptocurrency exchanges, everyone with Crypto in any exchange would have to participate. This would essentially leave all exchange wallets empty except for money they have earned through trading fees. Whether this is even possible is a question – could the Crypto network process that many transactions in a 24-hour period?
There is the issue of the English-centric nature of Trace Mayer and his following, as well. A huge amount of Crypto is traded in Chinese exchanges or in global exchanges like . These people are less likely to subscribe to Trace Mayer. Being dedicated traders they may not even see the actual value in symbolically proving their coin ownership.
One thing is for sure: several for advertising purposes. CCN recently reported on one particularly egregious example . One less-notable figure in the crypto community about their volume due to the actual nature and size of the market.
If exchanges are willing to somewhat nakedly lie about their trading volume, is it possible they’re also lying about having funds securely on hand? History shows that it’s far from impossible. The first major incident of bubble popping and bloodshed in cryptocurrency was , which became insolvent and before eventually getting caught. Founder Mark Karpeles as a result.
Solvency is a seriously important issue in a financial system which is designed such that you must control the private keys in order to truly control the money. The Proof of Keys event is designed to remind the trading community that while decentralized exchanges are emerging, the majority of the volume still takes place on exchanges which have full control of the money traded. Crypto itself is designed to remove the need for trust in financial transactions. Perhaps the only hope can be that the event grows in popularity in years to come and that exchanges which do not “fail” it in any way are lauded.
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Published at Thu, 03 Jan 2019 23:15:10 +0000
