Hotbit Exchange Accused of Rugpull as Selling Rampage Raises Concerns in Crypto Community.
Hotbit Exchange, a prominent cryptocurrency trading platform, is facing allegations of engaging in a selling rampage that is suspected to be a rugpull attempt. The accusations have emerged after decentralized finance (DeFi) project RichQuack took to Twitter to announce that it had fallen victim to a rugpull orchestrated by Hotbit. According to the tweet, the exchange allegedly sold a staggering 256 trillion QUACK tokens, which rightfully belonged to $QUACK holders on the PancakeSwap platform.
At the time of writing, the total value of the tokens sold off by Hotbit amounted to approximately $153,800. This incident has raised concerns within the crypto community regarding the integrity and trustworthiness of the exchange.
Hotbit’s Shutdown Amid Crypto Winter And Deteriorating Conditions
It is worth noting that Hotbit had previously announced its decision to shut down its centralized exchange operations in June, citing deteriorating operating conditions and changes in the broader crypto ecosystem. In light of this, all users were advised to withdraw their assets before June 21st. However, prior to this decision, Hotbit had already suspended withdrawals and deposits on its platform since August 2022, during the challenging period commonly known as the crypto winter.
To make matters worse, the exchange had also faced setbacks due to a criminal investigation involving a former employee, which resulted in law enforcement agencies confiscating its assets. Additionally, the collapse and subsequent bankruptcy filing of FTX Derivatives Exchange in November further exacerbated Hotbit’s financial woes. The exchange explained that the FTX collapse led to “continuous outflows of funds from CEX users…and deteriorating cash flow.”
Since the cessation of its centralized exchange operations, Exchange has largely remained silent, with little information available regarding the defunct crypto exchange. The recent rugpull allegations have shed new light on the exchange’s activities, prompting concerns about the safety and security of users’ assets.
In response to RichQuack’s claims, Hotbit has not issued an official statement to address the accusations or provide any clarification regarding the alleged rugpull incident. This lack of communication from the exchange has only fueled further speculation and mistrust among the crypto community.
Apart from RichQuack, no other projects or investors have come forward reporting any breach or attack by exchange thus far. However, some on-chain data insights have revealed suspicious dumping activities by the exchange across various projects. BSC Scan, a blockchain explorer, indicates that Hotbit dumped 4,000 Binance Coin (BNB) worth of BabyDogeCoin (BABYDOGE) on PancakeSwap, as well as an additional $500,000 worth of DogelonMars (ELON) on Uniswap.
As the situation unfolds, concerned users and investors are eagerly awaiting an official response from exchange regarding the allegations. The incident serves as a reminder of the risks associated with centralized exchanges and the importance of conducting thorough due diligence when entrusting funds to such platforms.