The cryptocurrency exchange ”liqui.io” could very well be in the midst of an exit scam. That is at least the case according to a vocal Redditor, who alleges that the exchange is liquidating customers’ assets.
However, some brief backstory is needed to fully understand the current situation. First and foremost, the exchange has delisted 25 different token pairs between September and October of this year.
Reddit user suspects exit scam and sell-off
According to the Reddit user, ”liqui.io has been delisting a lot of their coins lately. Including some of their top 10 volume coins like BAT. Meanwhile, they give customers just 15 days to withdraw after delisting (approx a month after announcement) to withdraw the coins.”
The user, entitled ”mastertim1”, goes on to note that ”people that are on vacation / hodling / sick are likely to miss their announcements. It seems like this short announcement time has a reason: Liqui has already started to liquidate 300k USD++ assets!”
Moreover, BAT was in the first series of 13 tokens that Liqui delisted. The Reddit post also references a specific address – 0xcc5570e7d39BA1738333782Fb0C5623fb6a6b1f2 – which supposedly belongs to Liqui.
Furthermore, ”mastertim1” alleges that this would indicate Liqui is now selling stolen balances that belong to clients who didn’t withdraw. Nevertheless, it is worth noting that it is currently unsure whether the address actually belongs to Liqui.
Liqui reportedly moved 1.4 million of the tokens
Adding insult to injury, the decision to delist BAT from Liqui came mere weeks prior to Coinbase’s listing of it. Furthermore, this announcement drove up the price of the asset. In effect, once Liqui reportedly moved 1.4 million of the tokens, the price had risen from 16 cents to 24.
In addition to this, Liqui’s more than 290,000 users were only given 29 days to withdraw their funds.
The case could be made that if 1.4 million tokens indeed remained on Liqui, it would be logical to extend the withdrawal time frame.
Speculation on the matter has tentatively suggested that Liqui itself might have been trading BAT. If this was the case, then this surplus could be explained by Liqui’s trading. However, Liqui does not mention that they trade against clients anywhere on their website.
Moreover, Liqui’s blog post on the subject states that users will it would be unable to process withdrawals. Nonetheless, the blockchain supposedly bears witness to how Liqui has tens of thousands of BAT at their disposal. It remains to be seen how this story continues to develop.
Image Source: “Flickr”
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.