Crypto exchange AAX halts withdrawals, says FTX put ‘immense pressure’ on industry

Lights illuminate a ATX power connector cables inside a 'mining rig' computer, used to mine the Electroneum cryptocurrency, in Budapest, Hungary, on Wednesday, Jan. 31, 2018. Cryptocurrencies are not living up to their comparisons with gold as a store of value, tumbling Monday as an equities sell-off in Asia extended the biggest rout in global stocks in two years. Photographer: Akos Stiller/Bloomberg

Cryptocurrency exchange AAX has suspended withdrawals, citing a glitch in a system upgrade.

AAX is a relatively small crypto exchange: data from CoinGecko showed that trading volumes over the last month peaked at around $2 billion. Over the last 24 hours, that number had dwindled to around $180,000. By contrast, Coinbase volumes were more than $1.5 billion in the same 24-hour period.

The crypto world has been roiled in recent days by the collapse of high-profile exchange FTX, with fallout spreading to the likes of BlockFi and Galaxy Digital. According to a notice titled “Forward Through Adversity” on the exchange website, a failure attributed to a third-party partner led to some user balances being “abnormally recorded” in the system. “AAX will continue our best efforts to resume regular operations for all users within 7-10 days to ensure the utmost accuracy,” the notice read.

From my best observation, it will take a few days before we can start to see things open up and be resolved. Not easy while market is fearful. For now, also for media, be a good player and give AAX time to open up gradually while ensuring absolute system integrity.

— ₿en Caselin HODL (@BenCaselin) November 13, 2022

In an additional statement provided to Bloomberg, AAX vice president Ben Caselin said, “The FTX situation has put immense pressure in exchanges everywhere with users nervous about exchange holdings.” He added, “It’s my observation this can be resolved in a few days, although rebuilding market confidence may take months.” Caselin also said that the AAX “funds are intact”.