Crypto exchange Kraken announced an update on Tuesday relaying that “deposits and withdrawals are currently not being processed” as the company continues to investigate an issue with its funding from Fidor Bank–an issue the exchange first disclosed three days ago.
In its website, Kraken explained that European funding provider Fidor is winding down its operations by mid-2024 and it is “working closely with Fidor to organize a seamless transition of our operations away from Fidor.”
However, three days ago, Kraken announced that it is investigating an undisclosed issue with the funding provider and thus, transactions will be delayed.
Since the announcement, reports from investors trying to withdraw from the platform are relaying the problems encountered in getting their money. However, some are clarifying that the particular issue only extends to withdrawals related to Fidor Bank funding and doesn’t affect the other assets from other funding sources.
When investors on Twitter ask Kraken’s support account about the issue, the platform said the “issue is with [the] funding provider Fidor.”
After the FTX implosion, many crypto investors have been wary and taking a hard look at other exchanges. The contagion has also sent many depositors to claim their money from these platforms, usually sending withdrawals at record high, causing some to experience liquidity issue and pause operations.
Most recently, Genesis Global’s lending arm announced that it is temporarily freezing redemptions and new loan originations after declaring it has around $175 million locked in FTX.
Ikigai Asset Management and BlockFi have also each revealed their exposure to FTX, resulting in the firms halting their respective withdrawals. In its Q3 2022 report, Galaxy Digital reportedly had around $76.8 million in cash and digital assets invested in the embattled crypto exchange, around $47.5 million of which is in the process of being withdrawn.
Even Kraken founder Jesse Powell reportedly told investors to “take their coins off exchanges” even those in Kraken.
Information for this briefing was found via 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.