Bitfinex Fires Back Again After Report Claims the Exchange “Has No Legitimate Banking”


Bitfinex, one of the internet’s largest cryptocurrency exchanges, is firing back at controversial financing reports online. Despite claims that Bitfinex “has no legitimate banking”, the exchange claims they’re solvent and stable in a blog post earlier this week.

Bitfinex posted an article titled, “A Response to Recent Online Rumours” on its blog. That article sought to dispel rumors that the exchange is insolvent.

Last week, rumors about Bitfinex’s financial struggles came to a peak after it was revealed that the exchange’s banking partner, Stable Bank, is facing problems. Bitfinex dispelled these rumors with links to its bitcoin cold wallet, its Ethereum cold wallet, and its EOS cold wallet, claiming those public addresses “represent a small fraction of Bitfinex cryptocurrency holdings”.

The wallet addresses show a total of 148,467.26 BTC, down from approximately 226,000 BTC on September 9. That’s about $979 million USD worth of bitcoin. The ETH holdings are worth around $382 million, while the EOS is worth around $203 million.

Bitfinex added that the negative rumors surrounding Noble Bank “have no impact on our operations, survivability, or solvency.” Bitfinex didn’t deny that Noble Bank was facing troubles, but they did claim that Noble Bank’s troubles are entirely isolated from Bitfinex.

Meanwhile, it was reported earlier today that Bitfinex is seeking to partner with HSBC to provide banking services. HSBC, the world’s seventh largest bank, would replace Noble Bank as Bitfinex’s financial partner. That news, however, has not yet been confirmed.

“Technically, Bitfinex Has No Legitimate Banking”

Despite the Bitfinex blog post, Bitfinex’ed was not impressed, writing the following on Twitter:

“So… technically, Bitfinex has no legitimate banking. Explains why they hide everything.”

https://twitter.com/Bitfinexed/status/1049548487216558081

Bitfinex’ed’s tweet posted images of a report from the Central Bank of the Bahamas. That report was a standard warning against specific banks operating in the country.

“The entities listed below are not licensed under the Banks and Trust Companies Regulation Act, 2000 to conduct banking and/or trust business in or from within the Bahamas. Members of the public who transact business with these entities, do so at their own risk.”

There are dozens of banks listed in the document. One bank called “Deltec Financial & Trust Services” is reportedly being used by Bitfinex and Tether. It’s not clear, however, if that’s even true: that’s just another claim made by Bitfinex. We can’t find any public connection between Deltec and Bitfinex posted online.

Bitfinex’ed is an independent blogger and researcher who has been famously outspoken against Tether and Bitfinex. He claims that some of the largest crypto organizations and financial institutions are all connected and scheming together to scam ordinary investors.

One of his most notorious claims, for example, is that EOS’s $4 billion ICO from earlier this year was designed specifically to prop up Tether, and that Block.one, Tether, Bitfinex, and Noble Bank are all run by the same “scam artists”.

Withdrawals Are Working as Normal with Bitfinex

Ultimately, there are two possible outcomes after these last few weeks of controversy for Bitfinex:

Scenario 1) Bitfinex has struggled to find a financial partner, and this has led to minor problems and questions of solvency, but those problems will be solved within the next few days when Bitfinex officially announces its partnership with HSBC. Withdrawals are working as normal, and Bitfinex has plenty of financial assets to support withdrawals without issue.

Scenario 2) Or, Bitfinex is just days or weeks away from collapse and does not have the funds to support client withdrawals; everything Bifinex’ed has said is true, and Bitfinex is being run by the same people who are scamming the rest of the crypto industry and propping up USD Tethers. The public addresses posted online by Bitfinex today represent the entirety of the exchange’s holdings, and those holdings will be drained over the coming weeks.

Ultimately, it’s hard to know who to believe.

For the time being, however, Bitfinex appears to be operating as normal without issue. Stay tuned for a possible HSBC partnership announcement in the near future.

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