A certain platform closed on September 23. The whereabouts of its $270 million insurance fund remain a mystery, of which about $239 million is in $BTC and $31 million is in $USDT. To date, the exchange has not disclosed how it will handle this money, and the community has begun to speculate that it will ultimately end up in the pockets of existing shareholders.
The original purpose of the insurance fund is to cover losses for users who get liquidated—it's not a severance bonus for the founding team. This platform shut its doors without a word, leaving its largest asset before the closure hanging in the air. That is yet another drain on trust in CeFi exchanges.
This long-established derivatives platform has not crossed regulatory red lines for the first time. Before leaving, it also kept the destination of users’ funds under wraps. In effect, it tells everyone with its actions: your funds’ safety ultimately comes down to the platform’s own explanation.
The original purpose of the insurance fund is to cover losses for users who get liquidated—it's not a severance bonus for the founding team. This platform shut its doors without a word, leaving its largest asset before the closure hanging in the air. That is yet another drain on trust in CeFi exchanges.
This long-established derivatives platform has not crossed regulatory red lines for the first time. Before leaving, it also kept the destination of users’ funds under wraps. In effect, it tells everyone with its actions: your funds’ safety ultimately comes down to the platform’s own explanation.