Coinbase Users Facing Cryptocurrency Withdrawal Delays up to a Week

Users attempting to withdraw digital assets from their Coinbase accounts are facing unexplained delays, according to sources in contact with CryptoGlobe. The users in question are U.S.-based, and no reports have surfaced of similar delays for non-U.S. customers.

The withdrawal delays are reportedly affecting all Coinbase assets. Several users reported withdrawal delays of up to a week, and that the delays had been occurring for two weeks.

There are no reports of the delays being mirrored on the Coinbase Pro platform, Coinbase’s institutional trading platform formerly known as GDAX.

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Chequered Past

These recent reports are nothing new, as the San Francisco-based tech firm at the center of the crypto industry has faced serious and repeated allegations of holding users’ funds since late 2017, when cryptoasset prices exploded.

CryptoGlobe and many other news outlets reported this summer on the raft of unanswered allegations from angry and distraught customers, which comprised 134 pages worth of complaints filed to the U.S. Securities Exchange Commission (SEC).

A Coinbase representative told CryptoGlobe at the time that the delays had been due to unexpectedly high trading volume, causing downtime during the dramatic runup in cryptoasset prices during late 2017/early 2018.

The company has recently taken steps to rectify this fault, reportedly upgrading its transaction and “surge” capacity by “1000%” earlier this year, as well as hiring hundreds of new employees.

In August, Coinbase’s trading volume was reported to have plummeted up to 83% since the January peak, making overcapacity an unlikely explanation for the present delays.

Coinbase, a U.S. company founded in 2013, also offers services in a total of 30 other countries. The supposedly $8 billion company has apparently had trouble attracting institutional investors, having recently discontinued its high-net-worth index fund product, itself only launched a few months ago.

Former Coinbase VP Adam White, the fifth employee of the company, recently departed his position to join Bakkt, the New York Stock Exchange-backed cryptocurrency venture set to begin offering physically-settled bitcoin products in November.

Crypto Market-Maker Altonomy Receives $7 Million in Funding from Polychain Capital

Altonomy, a New York-based cryptoasset trading, advisory, and asset management company, has completed a $7 million fundraising round from Polychain Capital, a leading hedge fund and venture capital firm.

Co-founded by Ricky Li, a former Manager of Research and Product at the CME Group, Altonomy has also received funding from 7 Blocks.

Additional Capital Will Allow Altonomy to Have More Inventory

Commenting on how the additional capital could help Altonomy’s business operations, Li said: 

As a liquidity provider for altcoins, more funding will allow us to have more inventory, taking larger exposure and managing risk more effectively.

Li added that the extra funding would allow Altonomy’s trading desk to provide better services - as the platform would not need to “put constraints” on customers at settlement.

Funds May Be Used to “Source Liquidity for Customers”

Olaf Carlson-Wee, the Founder and CEO at Polychain Capital, remarked:

As a long-time user of Altonomy’s trading services, it was an easy decision for us to invest in their business when the opportunity became available.

Carlson-Wee, a former Product Manager and Head of Risk at Coinbase, also mentioned that the additional funding would help “source liquidity for customers, regardless of token type, order size, market cap, or whether the asset trades on centralized or decentralized exchanges.”

According to Coindesk, Li had suggested to investors in January 2019 that they “liquidate enough ETH so they would have at least two years of runway.” However, Li is now anticipating that cryptocurrency prices may continue to recover - after enduring a long bear market that lasted throughout 2018.

Altonomy Introduces Cloud Service for Crypto Mining

In addition to providing crypto trading and asset management services, Altonomy introduced a new product last year, called the AltMiner. According to Li, AltMiner’s cloud service allows Altonomy’s bigger investors to mine various cryptocurrencies.

Altonomy’s management claims that the AltMiner has a “superior return profile” with the “newest generation of miners, low electricity costs and a secure hosting site.”

During an interview with CryptoGlobe in May 2019, Lee explained how Altonomy’s crypto trading services were developed and their potential benefits.

One of Altonomy’s main services, called electronic execution, allows mining firms, investment companies and crypto exchanges to “enter and exit positions as an outsourced execution desk.”

As a high-frequency market-maker, Altonomy also provides liquidity for various tokens to several crypto spot and derivatives trading platforms.