This week, rumors online claimed that a crypto exchange was experiencing insolvency issues, worrying the community. Amid the uncertainty, users identified Bybit as the exchange with alleged problems.
On Wednesday, Bybit’s CEO Ben Zhou refuted the rumors of a hack or lack of solvency on X, reassuring investors the exchange was operating as normal.
Bybit’s CEO Dispels The Rumors
On Tuesday, reports circulated of a crypto exchange insolvency on private chats. The rumors sparked fear of another FTX-like debacle looming. The reports originally surged as Arkham Intelligence’s Proof-of-Reserves (PoR) graph suddenly dropped from the $11 billion range to the $6 billion mark.
Bybit's assets drop in Arkham's graph. Source: S0ybo1 on X
An X user quickly pointed out that the news was false as Arkham’s graph was broken. The user detailed that a specific wallet was causing a bug that didn’t show over $4 billion in funds in the chart. However, if checked individually, all assets appeared on the wallets.
The community took the incident with humor, as many lightened the mood with memes and references to the FTX collapse while waiting for clarification. An X user shared a “copypasta” post from 2022, poking fun at the way rumors spread among the community. Part of the post reads:
The prop desks in crypto are worse than teenage girls when it comes to gossip and I don’t want to be collateral damage in a self-fulfilling prophecy.
Other users urged the community to properly research news “before spreading FUD,” suggesting other platforms to verify Bybit’s POR and related information.
On May 23, Bybit’s CEO Ben Zhou acknowledged the concerns and clarified that the crypto exchange had not been hacked, as some seemingly suggested, nor was it insolvent. Zhou shared the exchange’s POR snapshot from May 8 and linked Nansen’s dashboard.
Bybit's net worth sits at $11 billion. Source: Nansen
The dashboard displayed the exchange’s $11 billion assets. One of the charts reveals that the crypto exchange’s assets worth has remained above $10 billion this week, confirming that Bybit’s reserves did not drop.
At the time of writing, Arkham’s graph seems to be fixed. The platform’s POR graph for Bybit coincides with Nansen’s $11 billion graph.
Crypto Regulators Crackdown On Bybit
The recent FUD (Fear, uncertainty, and doubt) comes amid the crypto exchange’s regulatory scrutiny. Last week, French authorities called out Bybit for operating without a license in France.
The Autorité des Marchés Financiers (AMF) issued a reminder that the exchange was blacklisted in the country since 2022. Moreover, the AMF stated its right to block the crypto platform’s website and advised users to safeguard their assets before they were inaccessible.
Similarly, the Hong Kong Securities and Futures Commission (SFC) named Bybit a “suspicious” platform in March. As Bitcoinist reported, the SFC’s warning was part of the regulator’s efforts to crack down on unregistered platforms in Hong Kong.
The financial regulator listed 11 products offered by the crypto exchange as “suspicious” and clarified that Bybit was an unlicensed platform. The SFC warned users about the “risks” of investing in an unregulated platform.
Total crypto market capitalization is at $2.54 trillion in the weekly chart. Source: TOTAL on TradingView
Featured Image from Unsplash.com, Chart from TradingView.com
