KuCoin, a crypto-exchange that uses KuCoin as a currency has come under fire recently due to rumors by Reddit users about funds held on the platform. Reddit was the first place where this user vented his frustrations. After failing to make any progress with customer service, he wrote an open letter to Johnny Lyu. According to the user’s statements, the exchange was withholding ≈$50K worth of crypto on the exchange.
KuCoin, according to the user, had stated that they will be supporting a new BCH Fork called eCash. (XEC) This encouraged them as well as many other investors to buy the asset from the exchange. When the exchange was short of funds for cryptocurrency, problems arose. KuCoin customers realize they cannot sell their cryptocurrency holdings at significant losses (sold for cents per dollar).
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But, they discovered they were unable to transfer the coins. Since then, the user claimed that they have had ≈$50,000 worth of crypto being withheld by the exchange for over six months and still have not been allowed to move their coins.
Open Letter To KuCoin CEO
Reddit user, u/BCHcain, first raised the concern when they wrote an open letter about the matter to CEO Johnny Lyu around four days back. The open letter includes screenshots showing their communication with support staff over the past six months. The user explained that KuCoin had been giving them the runaround with no real indication of solving the issue and had ‘receipts’ to back this up.
Three days had passed since the open letter was posted. CEO Johnny Lyu responded with a very low effort response to an obviously distressed user.
“Thanks for bringing it up. The upgrade is underway, and since it’s not just a simple rename or rebrand, we still need some time to complete it. Thanks for your patience and understanding,” Lyu wrote.
Reddit users had called the CEO to complain about the reply. They pointed out that it proved all that was claimed by the user in the post, and that there wasn’t any interest in resolving their problem.
Calling on the Community
The open letter was posted on Reddit four days later. The u/BCHcain appealed to the community for help in amplifying the issue. This post received significantly more attention that the open letter.
Concerns were raised about the control centralized exchanges have on users’ funds. The centralized exchanges can control the user’s funds much like banks. That is what crypto-lovers are determined to end.
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A user had called KuCoin on the same platform and claimed that KuCoin was using Cloudfare in order to prevent access during bull rallies. This would allow users to take advantage of these liquidations to make a profit.
KuCoin has yet to reply to this second post. It continues to generate conversations about issues related to KuCoin, CEXes and general topics. The post received 5.3K likes and 1.6K comments as of this writing.
Featured image by CoinDesk. Chart from TradingView.com