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Major Crypto Exchange Goes Dark For 48 Hrs While Bitcoin Wobbles On South-Korea Crackdown

The fifth-largest cryptocurrency exchange, Kraken, is back online after a scheduled two-hour maintenance wiped out the network for two days – effectively freezing the assets of users unable to access their accounts or withdraw funds. While trading has resumed, withdrawals were disabled “for a minimum of 12 hours” as Kraken monitors their restored network for anomalies. Status updates can be found here.

We apologize for the uncertainty our downtime has caused. The scheduled downtime was to replace our old trading engine with a brand new trading engine – an improvement that customers have long asked for and that we have long been working hard on. –Kraken

According to Cointelegraph’s David Dinkins, “Kraken has arguably suffered the most problems of all major exchanges. Users, including myself, have experienced multiple connection errors and extraordinary difficulties placing and cancelling orders. It’s sometimes necessary to refresh Kraken’s page 10-15 times before being able to execute an action. Numerous users have complained that Kraken posted their orders multiple times (after telling them their order failed initially), in some cases costing them thousands of dollars.”

Kraken’s unexpected downtime hit amid Cryptocurrency gyrations after South Korea – which accounts for approximately 20 percent of global bitcoin transactions – announced that it was preparing legislation to close the country’s online exchanges due to rampant speculation in digital currencies. South Korean authorities raided several of the country’s largest cryptocurrency exchanges – Coinone and Bithumb.

An official at Coinone said that National Tax Service investigators had paid a sudden visit, while an employee at Bithumb said the company was asked to disclose paperwork. The Coinone official added that the exchange has been under scrutiny since last year by local police who “think what we do is gambling.” –QZ.com

According to Coindesk, the public backlash against the proposed move appears to be accelerating. On the Korean president’s Blue House website, more than 4,000 petitions have been filed related to “virtual currencies” since Jan. 10.

One petition asking the Minister of Justice to step down in light of the move received more than 30,000 signatures on its own. According to Reuters, one petition alone has attracted more than 100,000 signatures and the website itself became inaccessible at one point due to excessive traffic.

In mid-December, South Korean cryptocurrency exchange, Yapian, suspended digital currency trading and filed for bankruptcy after its systems were hacked. The exchange trades 10 virtual currencies including Bitcoin and Ethereum.

Yapian said in a statement that the latest security breach caused it to lose 17% of its total assets. The company didn’t specify the type of virtual currencies that were stolen or the financial value of its losses. In April, Youbit, formerly called Yapizon, lost 4,000 bitcoins now worth $73m to cyberthieves.

Users of the exchange with digital coins in their online accounts were told by Youbit on Tuesday that they could withdraw about 75% of their cryptocurrency for the time being. The remaining balances would be returned after the company goes through bankruptcy proceedings, it said.

It said it was “very sorry” that it had been forced to shut down.

 


Back on US soil, Kraken is waiving all trading fees through the end of the month to make up for the outage during the volatile period, according to a blog post published Saturday, in which the San Francisco-based company also assured clients that funds were kept safe during the incident.

“We apologize for the uncertainty our downtime has caused. The scheduled downtime was to replace our old trading engine with a brand new trading engine – an improvement that customers have long asked for and that we have long been working hard on.”

See below for Kraken’s entire post-crash update:

Trading

  • All orders have been cancelled prior to trading resuming
  • Trading pairs launched with no orders on the books
  • All funds in previously open orders have been returned to your available balance
  • Margin positions will remain open
  • Margin liquidations will be paused for at least 48 hours
  • Creation of new margin positions is disabled for at least 48 hours
  • Caution: Clients should be extremely careful with market orders and double-check limit order prices in an illiquid market

Funding

  • Withdrawals are now disabled and will remain disabled for a minimum of 12 hours (during this time we will be monitoring the new system for anomalies)
  • For fiat or crypto deposits (initiated before, during or following the downtime) please allow up to 2 additional business days for funds to be credited

Fees

  • All unleveraged trades will be charged 0 fees until January 31, 2018 (UTC)
  • Margin position, open, and rollover fees are reduced to 0.005% until January 31, 2018 (UTC)

New Accounts and Tier Upgrades

  • Verifications of new accounts will be delayed and are our lowest priority
  • Tier upgrades of existing accounts will have priority above new accounts
  • Note: If you are applying for a Tier 4 account or need help with OTC, please indicate this in your support request

 

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3 comments

  1. sarcrilege

    Growing pains. Locked away from profits. Didn’t the overall market go down overall over the weekend and is lower before the scheduled 2-hr maintenance/upgrade?

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  2. Baby Huey

    Lots of phony “internet” outrage. Huge twitter hashtag threads, very long Reddit threads.. people were going to sue. If it’s not up tomorrow, I’m calling the FBI. Blah blah blah.

    The second Kraken was up, people were depositing and trading as quickly as possible. Like the casino doors re-opened and the outrage was quickly forgotten.

    The bigger issue is.. like ISPs… so you’re going to leave Kraken and go where? Where are you going to go?

    Everybody is on lockdown mode. Verifications taken months. Other competitors are either out of country and questionable or like Coinbase, have very limited alt-coins to trade.

    So it’s back to BAU.

    Like the crash of 2009… people didn’t close up big bank accounts in droves. They were all pitchforks and fits in the air and then quickly forgotten as the next news story hit.

    Business as Usual

    Now go buy some more XRP!

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  3. Mad Marsupial

    Only 4.2M Bitcoin left to mine. 80% complete. https://cointelegraph.com/news/80-of-all-bitcoins-already-mined-only-42-million-coins-left-until-supply-cap

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