Since the collapse of several big crypto projects, FUD seems to dominate in the ecosystem. This week, it was the exchange platform KuCoin that was the subject of insolvency rumours. So much so that its CEO had to step in to reassure the community. Decrypting
KuCoin insolvent: the rumor of the week
While fear dominates the ecosystem, sometimes it doesn’t take much to create a rumor, and set Twitter ablaze. This weekend, several accounts were warning that it was impossible to withdraw funds on KuCoin. The fear was of course that the exchange would face insolvency. Several people therefore called on users to withdraw their funds:
BREAKING: KUCOIN EXCHANGE UNDER HUGE FUD ABOUT BEING INSOLVENT AND POSSIBLY HALTING WITHDRAWALS SOON!!!
GET YOUR MONEY OFF KUCOIN TO BE RATHER SAFE THAN SORRY!!!⚠️⚠️
– Kong Trading (@KongBTC) July 1, 2022
The anonymous Twitter account that raised the alert, Otteroooo, also confirmed that it was communicating directly with Johnny Lyu, KuCoin’s CEO, to confirm some data:
There were also reports of difficulties in withdrawing funds, with withdrawal times much longer than average. This has fuelled rumours over the past few days.
KuCoin CEO wants to stop the rumors
Johnny Lyu also took to Twitter to try to calm the community. He explained that KuCoin had never blocked withdrawals, and that the company was completely solvent:
Be aware of FUDs!
Not sure who’s spreading these sheer rumors, and what their intentions are, but KuCoin does not have any exposure to LUNA, 3AC, Babel, etc.
No “immense suffer” from any “coin collapse”, no plan to halt withdrawal, everything on KuCoin is operating well.
– Johnny_KuCoin (@lyu_johnny) July 2, 2022
” Beware of FUD! […] KuCoin has no exposure to LUNA, 3AC, Babel, etc. […] Everything works as expected on KuCoin. “
Lyu is of course referring to three project collapses that have shaken the crypto community very badly in recent months – Terra (LUNA), Three Arrows Capital, as well as Babel. The ecosystem has been on edge ever since, with prices falling sharply.
The CEO also said that the company had the right to take legal action against those who spread such rumours.
All of this is a reminder that at this time it is good to be cautious. Emotions and fear dominate the markets, so we must be attentive to both FUD, but also to potential projects that could be undermined.
