AEX Crypto Exchange Halts Withdrawals of BTC and Reputed Altcoins
The global cryptocurrency exchange, AEX, took a significant decision, a few days ago. It decided to halt the withdrawal of Bitcoin and well-known altcoins for 2-3 days. The decision is the answer to a happening that is affecting cryptocurrencies. To learn more about Bitcoin trading, visit bitiq.org.
However, before examining the order, it is important to know something about AEX, itself.
The AEX Digital Currency Exchange
AEX came into being in October 2017. It refers to a cryptocurrency exchange owned by the Chinese. However, operations are carried out in English too, since it caters to a global audience. Additionally, the exchange is not headquartered in China. Instead, it is based in the Seychelles Islands. Nonetheless, most of the clients are Chinese. The remaining clients are based in the U.S. and the rest of the world.
Users are very happy with AEX, for it permits anonymity. They need not provide any know-your-customer details or any information related to their personal bank accounts. AEX has the advantage of avoiding adherence to any type of regulatory compliances, since it is rather new, in comparison to so many other global exchanges.
The digital currency exchange governs two web-based trading platforms. One of them is the standard and basic one mainly meant for beginners. The platform displays simple charts that provide information about the pricing of various cryptos. There is even a trading history outlined below the chart. A simple order book is in place, too. As for the interface of the platform, users find it straightforward and simple to navigate.
The second platform is greatly advanced since it caters to experienced investors/traders. The display charts cover the entire screen and are advanced in nature. Other features include diverse drawing tools, 50+ technical indicators, analytical tools for judging the pricing, an order book, trading history, etc.
It is possible to trade the digital currencies listed on AEX, in six markets across the globe. These currencies stand within the list of the top 20-50, in terms of market capitalization. All the important coins are there, including Ether, BTC, Tether, etc. Newer altcoins, and ICO coins, are also in evidence.
Reasons for the Halt
Apart from focusing on BTC, the AEX exchange is also concentrating on well-known altcoins. They include Solana (SOL), Polkadot (DOT), Ethereum (ETH), etc. AEX has also issued the same order to Stablecoins too, such as USDC, USDT, etc.
However, why has the exchange taken this decision?
A significant reason is, mounting up liquidity. Liquidity is an easy/efficient way to convert a security/asset into ready cash, such that the market price remains unaffected. In other words, liquidity refers to the extent to which an asset may be sold/bought, wherein the price reflects the asset’s intrinsic value.
Cash is the best liquid asset of all since it is possible to change it into any other kind of asset rapidly and easily. It is unlike tangible and illiquid assets, such as collectibles, real estate, fine art, etc. Similarly, financial assets, such as partnership units, equities, etc., occupy varied positions on the liquidity spectrum.
The crypto market only seems to be crashing further and further, as evident by the dropping prices of Bitcoin, Ether, and diverse altcoins. These drops are occurring within the span of 24 hours.
For instance, Bitcoin displays a price of $20,709, indicating that it has gone down by 3.5%. Ether is even worse, revealing a price of $1,092, indicating a price reduction of 3.15%.
Investors and stakeholders are becoming jittery, as they view the market capitalization moving below $1 trillion. It is resulting in panic withdrawals. In turn, crypto-based platforms, and several cryptocurrency exchanges across the globe, are facing bankruptcy.
Regarding AEX, its overall market capitalization stands at $2.85 billion. Nonetheless, the digital currency exchange is sending out a message that within 2/3 days, it will display a mitigation plan that will set everything into place.
The AEX exchange states that the rapid withdrawals are creating a scenario of almost 100% liquidation. Therefore, halting has become necessary.
At the same time, the exchange declares that the order is only for altcoins that are highly prominent. These coins have been mentioned earlier. Investors may withdraw the lesser-known altcoins for use, whenever they wish, without hesitation.