Singaporean cryptocurrency exchange COSS has suspended trading on its platform, a move that has many of its users fearing the worst. The exchange stated that it was carrying out maintenance on its site. This has done little to expel its users’ fears, with many fearing it could be pulling off an exit scam.
Formally known as the Crypto One Stop Solution (COSS), the exchange stated in a blog post that it would be conducting maintenance on its site for the next three to four weeks. Thus, it would suspend all trading, withdrawals and deposits during this time.
It stated, “During this time, we will be migrating all our users to a brand new platform. All open orders will be cancelled, balances and accounts will be migrated, and your funds will be safe. There is no need to panic. Please do not believe in rumours or FUD spread by false messages and groups across any channel.”
The announcement was abrupt and unexpected, and unsurprisingly, many of its users immediately thought they were about to lose their money. The exchange has around 200,000 users, with over $2 million in deposits.
It wasn’t just the users who were caught unawares, some of the staff members too didn’t know of the closure until a few hours before it happened. A COSS spokesperson told Decrypt that the company had told some of its developers that a new API would launch soon. It didn’t tell them of the impending shutdown. “Everyone was kept in the dark,” the spokesperson stated.
He further revealed that the users have been very worried, to say the least, about their funds. He had stayed up all night to respond to user queries, assuring them that it wasn’t an exit scam. “We are not running away. I’m still there. We deal with everything and we stay as transparent as possible,”according to the COSS spokesperson.
The spokesperson also shed a light on what could possibly have led to the system upgrade. He revealed that the exchange had recently received the interest of a new investor who agreed to fund its transformation last week. With the new cash flow, the exchange could now attend to some issues it has shelved for years due to a shortage of funds.
Despite having over 200,000 users, COSS is still way below the standards that its peers adhere to. He stated, “We do not have a solid API, we do not have a trading engine, our UI is horrible…it’s been in need of massive improvement.”
The exchange has been on a steady decline in recent months, especially since it has failed to meet the latest exchange standards. It now processes around $1 million per day in trades, down from over $13 million per day in 2019. The upgrade is therefore critical if it wants to stay competitive.
The manner with which COSS conducted the exercise is considered unethical by some members of the crypto sector. Oliver G, a product manager at CoinMetro crypto exchange remarked, “I cannot agree with their communication today and this practice. Without any warning at all they have frozen client funds for 4 weeks. There is no excuse or reasoning for this. I suspect they do not have the client funds available to withdraw or there is another serious problem within their organization.”
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