Traders have sold the KCS token of the company after rumors circulated on Twitter about withdrawals being stopped by the exchange.
KuCoin (KCS) has seen its native token drop in value over the past seven day due to insolvency rumors. KuCoin traded at $8.75 and was 17.34% lower as of the time this article was written. According To CoinMarketCap.
KuCoin, the fifth-largest cryptocurrency exchange in the world, has a daily trading volume of $928 millions. The No. CMC has 49 digital assets, totaling $858 million.
Crypto Twitter rumours started to circulate earlier this week that KuCoin would stop withdrawals as it was close to going bankrupt. Johnny Lyu, KuCoin CEO, stated that his company was not exposed to LUNA or 3AC and Babel.
Lyu stated that there is no ‘immense suffering’ from any coin collapse, and that there is no plan to halt withdrawal. He also said that KuCoin “reserves the right to take legal action” against anyone spreading false rumors.
Lyu was referring specifically to three recent financial meltdowns within the cryptocurrency ecosystem: Luna (the governance token of Terra ecosystem), which saw tens or billions of dollars in value disappear last month in the spectacular Terra ecosystem crash; 3AC, or Three Arrows Capital which was a hedge fund that filed bankruptcy last week; and Babel Finance, a crypto lending platform, which suspended withdrawals and redemptions last month.
These are all examples of a liquidity problem in the crypto ecosystem at the moment as digital assets plunged in value during the bear markets.
Lyu also answered directly to someone asking if KuCoin was exposed to Celsius. This is reportedly near bankruptcy. Lyu replied: ” Nope.”
The crypto crash, which accelerated in May’s first week, has fueled rumors on Crypto Twitter. These rumors included those about Celsius, Three Arrows Capital and BlockFi’s solvency. Lyu claims that his exchange is performing well: He said that KuCoin was more active in the bear markets and that he had launched new features.
KCS has actually been up in the last 24 hours. Most cryptocurrencies are also up on Monday. It still has the worst seven day performance of all major digital assets over the past week.
