Popular cryptocurrency exchange OKEx has announced it will reenable withdrawals “on or before” November 27 of this year, as the private key holders it had lost contact with who was cooperating with an investigation has “completed assisting the authorities.”
The person OKEx is believed to have lost contact with is the firm’s founder Mingxing “Star” Xu. The exchange suspended withdrawals in October as Xu was cooperating with an investigation, in which OKEx says the firm was “confirmed not to have been involved in any wrongdoing or illegal activities, and the private key holder has now returned to his normal business functions.”
The announcement adds:
OKEx will therefore reopen unrestricted withdrawals on or before Nov. 27, 2020. Prior to withdrawals reopening, our team will conduct strict security checks to resume normal operations of the hot wallet system and ensure the safety of our users’ funds.
The exchange added that it maintained 100% of its reserves since its establishment, and as such 100% of user funds will be withdrawals without restrictions after withdrawals are reopened. The exchange will also launch a “significant user loyalty reward campaign” to make it up to its users.
Details of the campaign, OKEx said, will be announced in the next few days. The announcement included details on OKEx’s systems that deal with deposits and withdrawals. The complex system, per OKEx, ensures the funds are protected against hackers while the hot wallet keeps running smoothly.
Withdrawals, before being approved, are sent to a “semi-offline multisig stage” via a “special communication protocol” for signatures that the exchange says it is not an ordinary TCP/IP communications protocol. OKEx added:
We define this communication as a semi-offline signature service, in which it is practically impossible for an attacker to obtain the private key on a semi-offline server via an online attack.
Its semi-offline servers, it says, can’t be compromised if they are physically attacked as the private keys use multisignature technology and are stored in the server’s RAM “making it impossible for hackers to access.”
As such, OKEx clarified withdrawals were suspended because the private key holder was unable to authorize transactions. While the exchange has a backup mechanism for private key holders to trigger activation of a backup in the event of long-term incapacitation, they “failed to include other specific scenarios, such as private key holders becoming unreachable due to unforeseen circumstances in our contingency plan.”