Volatile market conditions and withdrawal pauses in cryptocurrencies
Hello dear readers and followers, this time I will expose my views on the pauses in cryptocurrency withdrawals, a practice that has been gaining strength since the current bear market began, the truth is that this type of expertise adopted by the exchanges to pause withdrawals in cryptocurrencies is something that somehow affects the credibility of the economic and financial structure of the crypto world.
There is no doubt that pausing cryptocurrency withdrawals affects the credibility of the economic and financial structure of the cryptocurrency market, since it creates excessive distrust among investors and traders, who, not finding a guarantee and availability of their cryptocurrencies, end up distrusting the market.
In recent months platforms such as Celsius paused cryptocurrency withdrawals, and other platforms joined this unfortunate action claiming that the volatile market conditions prevent them from the normal operation of the services provided by their exchanges.
Adding to this unhealthy practice was cryptocurrency exchange Zipmex, which earlier this week prevented its user pool from taking direct custody of its cryptocurrencies citing volatile market conditions.
Specifically cryptocurrency exchange Zipmex announced on its Twitter account the following; "Due to a combination of circumstances beyond our control, including volatile market conditions and the resulting financial difficulties of our key trading partners, in order to maintain the integrity of our platform, we would pause withdrawals until further notice."
At the end of the week Zipmex reactivated cryptocurrency withdrawals leaving doubts about the real reasons that led it to initially block withdrawals.
Decisions like these made by Zipmex is a recurring practice that several platforms have been taking in recent weeks, blaming the market turbulence and the resulting counterparty risks, an action that in my opinion creates unfavorable conditions for the health of the cryptocurrency market.
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