Venezuelan Crypto Exchange CoinCoinX ‘Temporarily’ Halts Operations – What’s Going On?

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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October 23, 2023

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The Venezuelan crypto exchange CoinCoinX says that it has “temporarily stopped” operations amid reports users cannot make withdrawals on its platform.

It is a move that has reportedly left “thousands” of customers unable to access their funds.

In a tweeted statement, the exchange said users’ funds were “safe” and “protected,” blaming the “pause” on the “current regulatory situation in Venezuela.”

The exchange claimed it was “temporarily” halting its “operations” pending regulatory approval, adding:

“The funds of our users are protected, secured, and available for use as soon as we obtain the necessary regulatory approval that will allow us to let them make transactions as normal. We understand the concern and worry caused by this situation. And we appreciate your patience.”

CoinCoinX blamed the “high costs of maintaining the platform, infrastructure, development, security, and [its] workforce” for the move.

But some have claimed that the firm has been hit by a crackdown on Bitcoin (BTC) mining.

I present to you the new Venezuelan version of Quadriga.

Due to the Venezuelan government’s latest efforts to crack down all crypto-related companies, thousands of people are being unable to withdraw their funds from CoinCoinX.

What’s worse is this Venezuelan Exchange was… pic.twitter.com/3sHIBV36Rg

— El Sultán 🟧⛏️ (@elsultanbitcoin) April 16, 2023

The firm wrote:

“It is impossible for us to continue providing the services that we usually provide without risking [customer] funds and accumulating liabilities from our suppliers.”

Many of CoinCoinX’s products were backed by its sizeable domestic mining operations.

The media outlet Criptonoticias reported that the government-run PetroApp has also been experiencing “problems on the platform for almost a month.”

Users of this platform are reportedly claiming their funds are “frozen with no way to withdraw them.”

Venezuela’s Crypto Crackdown – Is Crypto Exchange the Latest Victim?

A wider crypto crackdown appears to be sweeping Venezuela.

The crackdown is part of a probe into alleged government corruption.

SUNACRIP, the state crypto regulator, has been the subject of a major investigation into misappropriated state funds.

Its former head, Joselit Ramírez, has been fired and jailed.

Several leading SUNACRIP officials have also been arrested.

Eagle-eyed Twitter users also noticed that the logo of the Petro (PTR), Venezuela’s state-owned, oil-backed cryptoasset had been removed from the SUNACRIP headquarters.

Qué sentirá @PetroDivisa @LucianoFinanzas

Contexto: ya le quitaron el logo de petro y hasta el nombre de SUNACRIP a su EDF sede pic.twitter.com/BKW4s0eqGf

— Rei (@rvallesr) April 8, 2023

The SUNACRIP sign has also been removed, a possible indication that the government will move to disband the regulator.

A crackdown on crypto mining has also seen miners all over the country surrender their rigs to police officers.

Venezuela had previously sought to promote crypto-powered business and state-owned companies have been actively using crypto as a payments tool in international trade.

A deep political row with Washington has seen the USA attempt to freeze trade via international economic sanctions.

The government believes that SUNACRIP officials may have stolen up to $3 billion worth of crypto from state-run firms.