Is the Kucoin cryptocurrency exchange out of danger?

The cryptocurrency market has been in decline for months. Many players in the crypto space have filed for bankruptcy. This damaging situation has given rise to dubious rumors about the financial health of many cryptocurrency exchanges. The ultimate target is Kucoin, who vehemently denies the allegations against it.

Kucoin is not in danger the CEO says

In a tweet on Saturday, otterooo, the account that tweets about cryptocurrency developments, made the alarmist prediction. According to confidential information, he claimed that KuCoin would be insolvent. She added that the platform may not have sufficient resources to satisfy user withdrawals, suggesting Kucoin’s insolvency.

In this regard, Johnny Lyu refuted the claim that his company suffered losses due to the collapse of Terra. KuCoin CEO made it clear that most of the funds in KuCoin wallets do not belong to exchanges, but to users.

“It is our responsibility to keep them safe and to ensure that users can always withdraw all their funds whenever they want. Having a LUNA wallet doesn’t necessarily mean that KuCoin as a company holds a lot of LUNA tokens and I’m sure the difference is obvious.

KuCoin CEO Johnny Lyu firmly believes the exchange is by no means insolvent. In support of his statement, he highlighted his company’s progress despite the bear market that is forcing many other cryptocurrency companies to review their development plans.

Since the start of the bear market, the Kucoin platform has successfully raised $ 150 million in funds last May. Johnny Lyu also points out the continuous recruitment of new employees and the addition of new features on the platform.

As for the $ 500 million financial hole, Otteroooo’s Twitter account provided no evidence that the alleged employee actually worked at KuCoin.

KuCoin CEO invites his clients to form their own opinion on the situation. For many, in fact, it is difficult to choose which of these two personalities to believe. Johnny Lyu said he told Otteroooo. However, he refused to be convinced.

Solve the real news and the false rumors

Companies operating in the crypto space face enormous pressure on a daily basis. Between market volatility and onslaught from competitors, foreign exchange firms have to work harder to stand out. The current rumors against Kucoin are tarnishing the reputation of the exchange, causing some panic in the market.

Even in a healthy and bullish market, companies choose to ignore these attempts to create panic without evidence. This is to avoid paying attention to false information hawkers. However, the bear market and recent corporate failures are forcing companies to disprove some rumors that only fuel FUD and panic.

This is an opportunity for Kucoin’s CEO to issue a warning: “Beware of FUD attempts! I don’t know who is spreading these rumors or what their intentions are, but KuCoin has no exposure to LUNA, 3AC, Babel, etc. No “tremendous pain” from a “cryptocurrency crash”, no planned withdrawal interruptions, everything works fine on KuCoin.

Many interests, at least financial ones, want the cryptocurrency market crash to continue. Just recently, a massive short selling attack against USDT (Tether’s USD stablecoin) was exposed.

So the question is whether HODLers and bullish investors will catch on at current price levels, or whether panic will manage to push us deeper into the bear market.

Bear markets don’t just reduce investor returns. It also brings questions and questions. One thing is certain: transparency is the best way to ensure trust.

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