Gemini Exchange to be In the New Scandal Now

2 OTC traders reported on account closure on the exchange without any warnings
06 February 2019   475

The Gemini exchang is in the center of a new scandal after operators of two over-the-counter trading platforms (OTC) said their accounts were closed without any explanation when trying to pay off Gemini Dollar (GUSD). This is reproted by CoinDesk.

The platforms that complained about the closure of accounts wished to preserve anonymity in order to avoid damage to their reputation.

So, in one of the cases, Gemini closed an account of an OTC-trader from Latin America after he said that he wanted to convert several million dollars cash to GUSD. Additionally (also on condition of anonymity) a confirmation was received from a large exchange that the mentioned OTC-trader is conducting professional activities and enjoys a good reputation.

Nevertheless, Gemini said that after studying the details of the account to be closed, adding at the same time that the specific reasons for the exchange can not be called.

In another case, the US-based OTC platform also lost access to its account, although before that it managed to withdraw several million dollars from GUSD. Representatives of the company suggested that all of this is part of Gemini’s strategy to "maximize its status on CoinMarketCap."

Representatives of another OTC platform, which has a valid Gemini account, confirmed that this problem is widely known and therefore they are not in a hurry to convert GUSD into dollars.

Gemini is a New York trust company. As a result, some potential customers will be unable or unwilling to pass our robust compliance program. This is a feature, not a bug, and what makes Gemini different. We understand this may frustrate some, but this is necessary to build trust in the future of money.
 

Exchange's Reply

Gemini also reported that by today had repaid $ 133 million worth GUSD, which is more than half of the token emission, and some customers managed to withdraw up to $ 40 million at a time.

Nevertheless, CoinDesk notes, it is known that last year Gemini offered OTC-platforms and market makers to purchase GUSD tokens with a 1% discount. This was done in order to increase the share of coin in the market. In particular, under the terms of the agreement, Gemini partners had to agree to certain restrictions that would not allow them to withdraw into dollars immediately after the tokens were credited.

The aforementioned trader from Latin America refused this offer, as he planned to use GUSD to transfer assets to Fiat, and acquired tokens through his own channels. At the same time, representatives of the exchange warned him that withdrawal of large amounts of funds could cause damage to stablecoin.

Hacked Zaif Exchange to Resume Operations

It was hacked in September last year,  about $60 million in cryptocurrency was stolen from its platform
22 April 2019   88

Japanese cryptocurrency exchange Zaif announced that it will complete the transition from the Tech Bureau to the Fisco Digital Asset Group (FDAG) on April 22 and resume normal operation the next day, Cointelegraph reportes.

In September last year, the exchange underwent a hacker attack when about $ 60 million in cryptocurrency was stolen from its platform, including Bitcoins, Bitcoin Cash and Monacoin. As part of the compensation plan to users, FDAG exchange acquired a large stake in Zaif business and transferred to the Tech Bureau over $ 44.6 million.

According to an earlier announcement of the exchange, 40% of the lost funds will be compensated to users by Fiat, and the remaining 60% - to the cryptocurrency, which will be available for withdrawal on April 23.