There is a great amount of fear being felt throughout the cryptocurrency industry due to the FTX exchange’s latest crash.
This is the reason why if any other exchange or crypto firm faces a problem that is somehow similar to that of FTX, it raises many concerns.
AAX Ran into Trouble
Something very similar has happened to AAX, a cryptocurrency exchange based in Hong Kong. The exchange reportedly got into trouble as it ended up facing an issue with the withdrawals
The exchange recently had to suspend withdrawal access for the users on its platform.
It raised many concerns among the users who bombarded the social media platforms alleging the exchange of going out of business.
There were several claims about the exchange having its holdings at the FTX exchange, just like a firm named BlockFi.
This meant that the regulatory authorities would launch an all-out inquiry against the exchange in Hong Kong. This could prove to be extremely bad for the exchange to run its operations in the country.
AAX Denied the Rumors
As the matter caught fire really fast, the executives at the exchange knew the severity of the matter. Therefore, they promptly addressed the issue denying all the negative claims made by the communities.
They claimed that their exchange pausing the withdrawals had nothing to do with the collapse of the FTX exchange. They completely denied the accusations and rumors that linked AAX with FTX.
Users were notified on November 13
According to the market observers, the confusion around the entire matter was mainly because of the users’ fears due to the FTX exchange.
Due to the recent FTX crash, the entire crypto industry has become very sensitive. The trust level of the investors and users has plunged in almost every exchange due to the recent event.
This is the reason why there is a huge outflow of funds recorded from the cryptocurrency exchanges since November 7.
It was on November 13, when the users of AAX saw a system upgrade notification on the exchange’s website. The message did intimate the users that the system upgrade was taking more than the usual time.
It further added that due to the system upgrade being delayed, the users would face a delay in carrying out withdrawals from the exchange.
They had to fix a certain glitch in the system, which required them to temporarily pause the withdrawal and other services.
Impact on the Native Token
The exchange has over 2 million users worldwide and it was a big deal for the exchange to fix the glitch as soon as possible. However, it soon became a bigger matter to clarify any confusion.
Although the officials tried to fix the problem and clarify the misinterpretation, it had already done its damage. The native token of the AAX exchange “AAX Token – AAB” ended up facing a decline.
In a matter of 24 hours, AAX Token has plunged 13.06% and it is now trying to recover from the loss. However, as the investors took it for something else, it is expected that the price of AAB would soon rise.