HitBTC is Allegedly Holding User Funds Ahead of Proof of Keys Event

Cryptocurrency exchange HitBTC has been suffering a series of complaints from its users who claim that their accounts have been frozen ahead of the Proof of Keys event, which is scheduled to be held on January 3rd.

The annual Proof of Keys event is part of a movement started by Trace Mayer, a well-known bitcoin (BTC) investor and host of the Bitcoin Knowledge podcast. Those who participate in the event withdraw their cryptocurrency from centralized exchanges (or any other third-party service) every year on January 3rd. The purpose of withdrawing funds is to determine whether third-parties can be trusted with managing users’ assets.

On December 31st, 2018, a Reddit user named PEDXS wrote a complaint, noting that HitBTC was not allowing customers to withdraw their funds from its exchange. Redditor PEDXS claimed that he had submitted the documentation required to pass know-your-customer (KYC) checks and requirements. He also alleged that HitBTC had been holding his funds for 6 months.

HitBTC Allegedly Failing To Keep Its Promises 

However, PEDXS noted that he had been able to withdraw most of his money from the controversial Denmark-based crypto trading platform. There is only a small amount of crypto left in the user’s account with HitBTC for day trading purposes. Commenting on the frustration he experienced when dealing with the exchange, PEDXS revealed:

After months of sending 40 plus emails, HitBTC finally unfroze my account. I immediately withdrew most of my funds but left a small amount to day trade. I did that because HITBTC promised that “No further automated restrictions will be applied.”

Confirming that he also experienced problems when trying to withdraw his funds from HitBTC, Reddit user LOOKATMYIQ wrote:

Submitted all my documents/evidence for KYC days ago and now support [is] going cold on me. Have I been scammed? I have been trading crypto for years on all kind of exchanges and never had my funds locked without warning like this. Support [was] fast to respond when asking for additional (over the top) information but since I have given them everything they have asked for they’ve just disappeared on me.

As an experienced cryptocurrency trader, PEDXS claims to have profited from his trading activities as he managed to “build back [his] balance … to a couple BTC.” But with the Proof of Keys event approaching, HitBTC allegedly “blocked” all the withdrawals he tried to make and reportedly froze his account again.

"Failing To Keep Up With Innovation & User Demands"

Harsh Agarwal, an online exchange reviewer, noted:

HitBTC was something that began as a promising crypto exchange and got lucky with the big crypto wave in 2016 and 2017, but it [definitely] failed to keep up with the innovation and user demands. They are barely surviving, and this can have a major impact on users who are using HitBTC as their crypto exchange.

Meanwhile, eccentric crypto enthusiast John McAfee has also been warning his followers regarding HitBTC’s questionable operations. McAfee tweeted (in July 2018): 

The crypto exchanges have become the thing that we have originally fought against. Their power is immense. Hitbtc, for example, has increased suffering for millions of poor people who cannot afford the minimum buy-in since it is greater than their monthly income. Boycott them.

As CryptoGlobe reported in July 2018, several HitBTC users had claimed that the exchange was holding their funds without providing a reason as they had already submitted all required KYC documentation. The frustrated users had also accused the exchange of engaging in "selective scamming" as it was allegedly going after certain accounts.

Zcash 'Company' Changes Name to 'Zerocoin Electric Coin Company' for More 'Clarity'

The Zcash company, which supports the ongoing development of the Zcash (ZEC) platform, a leading privacy-oriented cryptocurrency, has rebranded to the Electric Coin Company.

According to an official company blog post, the name change from “Zcash company” to “Electric Coin Company” was made in order to have more clarity. Explaining that the “legal name” for the firm was always “the Zerocoin Electric Coin Company, LLC”, the organization clarified that it had been referring to itself as “the Zcash company.”

However, the company’s blog noted that the development of “Zcash” is a community-based project and that some of the privacy coin’s business-related initiatives may involve the Zerocoin Electric Coin commercial entity. Moreover, Zerocoin’s operations are not directly associated with the Zcash Foundation - which in itself is a “separate and independent” organization, according to the z.cash blog post. Notably, the Zcash Foundation has “its own mission, team, and board of directors.”

Rebranding Process: New Domain, Change Office Sign

Acknowledging that it will take the company “a little while to get the new branding right, launch a new domain, and change out the sign at the office”, the company blog mentioned that “the name change is public.” Except for the name change, the entity associated with Zcash explained: 

We are the same team, with the same mission: to empower everyone with economic freedom and opportunity. We developed and help steward Zcash.

Zerocoin's Research & Engineering Projects May Not Be Integrated Into Zcash 

Notably, the Electric Coin Company is currently working on “research and engineering [projects] that may, or may not” be integrated into the Zcash codebase, the blog noted. At present, the Electric Coin team consists of around 30 professionals from across the globe that are involved in the following initiatives:

  • “Product Development and Support”,
  • “Builds Zcash software”,
  • “Participates in cryptographic research”,
  • “Works with third parties to perform regular security audits of Zcash”,
  • “Improves the safety and security of the Zcash network”,
  • “Works on the Zcash user experience, such as the reference wallet” 

Company Website, Social Media Accounts To Be Changed/Updated Soon

In addition to working collaboratively on the initiatives listed above, the Electric Coin company helps in “translating content into different languages”, creates "educational content”, and supports the overall development of the Zcash platform.

As mentioned in the company’s announcement, the Electric Coin company “information will be moved from https://z.cash/ to a new domain with its own website.” Social media accounts associated with the company will also be updated.