Several crypto exchanges, including Alameda and FTX, are facing trouble, with allegations of re-hypothecating funds and risks to investors’ crypto holdings. Bybit has announced another round of layoffs to survive the bear market, and Genesis reportedly owes Gemini almost a billion dollars, putting Gemini in a difficult financial position. The market is relatively strong, with Bitcoin 1500 off its recent low, but investors are advised to consider self-custody and use cold storage wallet to keep their investments safe. Meanwhile, the Winklevoss twins of Gemini are seen as honorable but may not be able to pay off the $900 million shortfall.
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If You Have Your Crypto on This Exchange You Are Possibly in Big Trouble
The crypto market has been abuzz lately with news about exchanges in trouble. If you have your crypto on one of these exchanges, you might be in trouble too. In this article, we’ll give you an update on the situation and why you should consider cold storage to keep your crypto safe.
Cold Storage: The Whole Point of Crypto
First of all, let’s talk about cold storage. The whole point of cryptocurrency is to have decentralized money. If you keep your crypto on a centralized platform, you negate that whole factor. Even if you buy crypto as an investment, keeping it on an exchange puts it at risk. Many exchanges are full of greed and do things that put your crypto in danger. Therefore, it is highly recommended to move it to cold storage. You can find a ton of good tutorial videos on cold storage, and we suggest Ledger or Trezor as storage solutions.
Crypto Exchanges with Trouble
Alameda on FTX and ByBit are some of the exchanges in trouble. Same Bigman Free claims he has little knowledge of Alameda’s operations despite owning 90% of it, and he said the same thing about FTX. However, he admitted to re-hypothecating, meaning that when you deposited on FTX, it really went to Alameda. You didn’t actually buy Bitcoin with that money. You only showed that you had Bitcoin, and they moved the money over to Alameda. ByBit, on the other hand, announced a second round of layoffs in 2022 to survive the bear market. They had to lay off about 30 percent of workers because it seems they are having a hard time.
The Trouble with Gemini
The real company in trouble is Genesis, who owed Gemini 900 million dollars. Gemini had to shut down its earned program and halt withdrawals. The Winklevoss twins, who run Gemini, are generally upstanding, but it’s uncertain if they can pay off the $900 million. It’s best to move your crypto off the platform until we know what’s going to happen.
Final Thoughts
The crypto market is looking relatively strong, but there are still a lot of collapses happening. It’s vital to keep your crypto in a safe place, like a cold storage wallet, to weather these bear markets. Remember, it’s always better to buy when the market is down and keep your investment in a safe place, rather than selling when the market is low. Stay safe out there, and consider moving your crypto to cold storage today.
