What’s going on over at Canadian Bitcoin exchange CAVIRTEX?
On Monday, the exchange took to Twitter to announce that bitcoin withdrawals have been disabled. The reason? They needs to refill their hot wallet by bringing in coins from cold storage.
Bitcoin withdrawals have been disabled as a result of refilling our hot wallet. Will be fixed shortly. Apologies for the inconvenience.
— CAVIRTEX (@CAVIRTEX) October 6, 2014
In another tweet, the company said much the same: “Recent volume has resulted in our hot wallet running dry. We’re moving coins from cold storage. Will be fixed shortly. Apologies.”
Yet here we are a day later with no further updates from the company, and a review of tweets on the subject show that bitcoin withdrawals are still not permitted. Trading and withdrawal of litecoin, as examples, have not been stopped.
And while this could just be a routine process for the folks at CAVIRTEX, the delay is raising suspicion among some members of the community — members who may have also been affected by the Mt. Gox collapse earlier this year, when similar a similar bitcoin withdrawal halt was imposed.
No surprise, community members want CAVIRTEX to prove their solvency.
But it’s important to note that companies storing large amounts of bitcoin often store them offline, and in a geographically-distributed manner. Therefore, we shouldn’t rush to accuse the company of insolvency or wrongdoing. They could dealing with a logistics issue.
I’ve reached out to the company’s spokesperson to try and get additional information, but have not received a response before publication time. As for answers — time will tell what’s really going on.
We’ll keep you updated.