There have been recent reports that Crypto.com users in Canada seem to be unable to withdraw from their accounts.
“I requested an etransfer on Friday and yesterday support told me that the feature is not working at the moment; they’re working on restoring it [at the moment],” a Reddit user complained.
“Any Canadian experiencing delayed e-transfer withdrawals?” asked another Reddit user in a separate thread. “Typically, e-transfer withdrawal would have been deposited into my bank with 12 hours of request. Usually over night and next business day. This time I requested 2 business days ago and its still pending.”
Even Crypto.com’s customer service Twitter account is getting complaints about being unable to withdraw in Canadian dollars. The customer support account mostly just asks complainants to send a direct message to take a closer look into the transaction.
Does this spell a bigger issue?
This isn’t the firm time the firm has faced withdrawal issues. In January, the Bank of Lithuania ordered Transactive Systems UAB, a local payment processor, to stop providing services to existing clients “whose operations are related to virtual currencies.” This came after the Bank inspected Transactive and “identified significant violations and shortcomings of the Law on the Prevention of Money Laundering and Terrorist Financing.”
Crypto.com, one of Transactive’s digital asset customers, responded to the outage by alerting users that Euro deposits and withdrawals had been “temporarily disabled.”
The crypto firm stated that it was “in the process of migrating our EUR Fiat Wallet to a new provider and estimate this transition will be complete in approximately 72 hours.”
Many Crypto.com customers were still waiting for the exchange to complete this ‘transition’ more than a week after announcement. Angry customers took to social media to vent, noting that Crypto.com was attempting to portray this hiccup as a planned event despite the company saying nothing about it until the day after customers publicly complained about their inability to conduct Euro-based transactions with the exchange.
By asking clients to deposit money to a Malta-based firm called Foris DAX MT Ltd, Crypto.com was able to recommence certain Euro transactions. However, it appears that many traditional banks are unwilling to do business with Malta-based financial institutions, which has resulted in a flurry of stories of Crypto.com customers’ transactions being canceled when they attempted to deposit to Foris DAX MT, while at the same time serving as an example for how Crypto.com chooses to communicate with its clients in times of crisis.
Meanwhile over here in Canada, Crypto.com delisted Tether (USDT), including all trading pairs with the stablecoin earlier this year, signaling regulatory issues. This follows after the Canadian Securities Administrators (CSA) provided an update last December on “strengthening its approach to oversight of crypto trading platforms.”
“The CSA is of the view that stablecoins, or stablecoin arrangements, may constitute securities and/or derivatives,” the agency said in its statement. “Crypto trading platforms that are registered or that have entered into a pre-registration undertaking are reminded that they are prohibited from permitting Canadian clients to trade, or obtain exposure to, any crypto asset that is itself a security and/or a derivative.”
Come February, the CSA said it would tighten requirements for cryptocurrency exchanges operating in the country.
Twitter user @Cryptadamist meanwhile also highlighted that another possible reason for the frozen accounts is that the crypto exchange is experiencing liquidity issues, rather than it being regulatory related at all, citing recent on-chain transactions as evidence of potential funding problems being experienced by the company.
Information for this briefing was found via Coingeek, Reddit, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.