Crypto Long & Short: The OKEx Drama Exposes a Weakness in Crypto Market Infrastructure

Crypto Long & Short: The OKEx Drama Exposes a Weakness in Crypto Market Infrastructure


This week saw more exchange drama rock the crypto markets. 

OKEx, one of the industry’s largest crypto-fiat exchanges, suspended all cryptocurrency withdrawals, saying one of the exchange’s key holders has “been out of touch” with the exchange because they are “currently cooperating with a public security bureau in investigations.” 

Coming hard on the heels of the BitMEX indictments from a couple of weeks ago, this surely will focus the market’s attention on the security of the withdrawal protocols of large exchanges.

At the time, concerns surfaced that withdrawals might be halted from BitMEX, one of the largest derivatives exchanges in the industry. The withdrawal protocol needed a certain number of authorized signatures, and one of the authorized signatories had been arrested. The concerns turned out to be unfounded, withdrawals continued without a hitch, but the possibility, combined now with OKEx’s reality, highlights how unique crypto asset market infrastructure is. 

Traditional market-infrastructure

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