Many Bittrex US Customers Fail to Claim Their Assets
A significant number of Bittrex US customers have missed out on claiming their crypto assets, resulting in millions of dollars left behind. The deadline for approximately 1.6 million customers to claim their assets on Bittrex US and Bittrex Malta exchanges has passed, but only 35,972 customers (less than 3% of the total) made claims, totaling $143.76 million in value. Surprisingly, Bittrex was not insolvent and had plans to return 100% of customer assets through bankruptcy proceedings.
Low Engagement Due to Inactive Accounts and Small Balances
Patty Tomasco, a bankruptcy legal counsel for Bittrex, explained that the lack of engagement from customers can be attributed to inactive accounts and low balances. Most of the remaining customer balances were below $100, with many accounts being inactive for over a year. Customers were reluctant to provide extensive personal information for small sums of money.
Users Face Challenges with Account Verification
To withdraw funds from the platform, customers had to undergo an extensive Know Your Customer (KYC) process and provide various personal details. Some customers faced slow and disjointed communication during the withdrawal process, leading them to give up on verifying their identity and retrieving their funds. However, it is important to note that some individuals eventually succeeded in withdrawing their funds after encountering similar difficulties with account verification.
Unclaimed Customer Funds Will Be Used for Other Claims and Fines
During the bankruptcy hearing, it was stated that unclaimed customer funds would be used to pay other claims and regulatory fines. Bittrex announced its shutdown in the US due to regulatory pressure and a lack of clear requirements. The SEC charged Bittrex for operating an unregistered national securities exchange, broker, and clearing agency. The platform filed for bankruptcy, but Bittrex Global will continue operations for customers outside the US.
Hot Take: Bittrex US Customers Miss Out on Claiming Crypto Assets
A significant number of Bittrex US customers have failed to claim their crypto assets, resulting in millions of dollars left behind. Despite Bittrex not being insolvent and planning to return 100% of customer assets through bankruptcy proceedings, only a small percentage of customers made claims. The lack of engagement can be attributed to inactive accounts and low balances, with most remaining balances below $100. Some customers faced challenges with account verification during the withdrawal process. Unclaimed customer funds will be used for other claims and regulatory fines. Bittrex’s shutdown in the US was due to increasing regulatory pressure, but Bittrex Global will continue operations for international customers.
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