Crypto Exchange AAX Looking at Potential Incoming Bankruptcy

Cryptocurrency influencer Lark Davis recently tweeted that he senses a potential bankruptcy announcement from crypto exchange AAX. The bankruptcy could happen due to recent turmoil within the company, including liquidated trader future positions, halted withdrawals for two weeks, deleted Youtube channel, and executives stepping down.

#crypto exchange AAX has liquidated trader future positions, withdrawals have been halted for two weeks, deleted their Youtube channel, executives fleeing…

Looks like the next bankruptcy will be announced soon!

— Lark Davis (@TheCryptoLark) November 29, 2022

Following the news of AAX pausing withdrawals, Vice President of global marketing and communications, Ben Caselin announced his resignation from the crypto exchange. Caselin further shared his reasons as to why he has decided to leave the organization.

He highlighted a lack of empathy and an overtly opaque attitude exhibited by those handling the platform. He adds that the brand is over, and the trust is brown, hence, there’s nothing to be done except wait for actions. Concluding in a note, he mentions,

AAX stood for something, but all that is now hollow

The Hong Kong-based AAX initiated the suspension of withdrawals on November 14 on account of a system upgrade to fix a glitch. The crypto exchange even confirmed that the halt has nothing to do with the collapse of Sam Bankman-Fried’s exchange FTX.

Moreover, the exchange addressed its 2 million users across the globe saying that the scheduled upgrade was due to “the failure of our third-party partner,” resulting in abnormally recorded users’ balances in the AAX system.

Despite confirming no relation to the FTX collapse, AAX soon shared its need for additional capital as its investors are removing funds due to uncertainty in the market caused by SBF’s failed exchange. The team highlighted that withdrawals of investor funds could cause a serious capital deficit, that will require attention before continuing with regular operations.

Source