AscendEX Faces Withdrawal Issues as ZachXBT Questions Reserves
Vexoda Newsroom
Multiple users reported delayed withdrawals from AscendEX after blockchain investigator ZachXBT flagged potential liquidity issues and urged the exchange to explain its reserves.
In recent days, multiple cryptocurrency traders have faced significant delays in withdrawing funds from AscendEX. These complaints emerged following a warning by blockchain analyst ZachXBT who highlighted what he perceived as insufficient large-cap reserve holdings on the platform.
One user identified as Lorenzo Navarro Rodriguez reported that a 4,196 USDT withdrawal remained stuck in an 'initiating' state since June 10th. Several other users echoed similar experiences over the following days, indicating widespread dissatisfaction with AscendEX’s service.
In response to these issues, ZachXBT posted on Telegram expressing concern about AscendEX's liquidity and urging the exchange to clarify its reserve status. The analyst pointed out that AscendEX's reserves were heavily skewed towards small-cap tokens like UNITE and REUR, suggesting a potential shortfall in key assets such as Ether (ETH) and USDT.
According to blockchain data analyzed by Arkham, AscendEX’s largest holdings included $10 million worth of UNITE tokens, followed by smaller amounts of REUR ($5.24 million), ASD ($2.9 million), and Reservoir rUSD stablecoins ($600,000). This distribution indicated a lack of substantial reserves in more liquid assets.
Questions about exchange liquidity have been highly sensitive since the collapse of FTX in 2022, which exposed significant reserve shortfalls leading to its bankruptcy. The incident sparked widespread customer withdrawals and increased regulatory scrutiny on exchanges worldwide.
The implications for AscendEX are severe if these reports prove accurate. Delayed withdrawals could erode user trust and lead to further outflows of funds. Additionally, the exchange may face pressure from regulators who have become more vigilant in monitoring reserve adequacy following FTX’s failure.
Traders should closely monitor how AscendEX addresses these concerns. A swift response with transparent disclosure of its reserves would be crucial for restoring confidence among users.
Source: Cointelegraph. Summarized and rewritten by the Vexoda Newsroom. This is market news, not financial advice.