Many users have reported problems withdrawing funds from cryptocurrency exchange AscendEX, which may be showing signs of liquidity problems, according to blockchain researcher ZachXBT.
An X account using the name Lorenzo Navarro Rodriguez he said Tuesday’s post stated that a withdrawal of USDT 4,196 has been stuck in an “initiating” state since June 10. The account also indicated that repeated customer service inquiries went unanswered.
At least five other users responded to the post in the following days, reporting similar recall issues.
On Friday, ZachXBT announced in a telegram post that the exchange lacked large-cap reserves for tokens such as Ether (ETH), USDT (USDT), and Solana (SOL), indicating potential “liquidity issues” on the platform. ZachXBT he insisted platform to respond to reports of delayed withdrawal requests and provide greater transparency as to why its balmy portfolios have low liquidity.
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Exchanges rely on liquid reserves of widely traded assets to process customer withdrawals. A shortage of these assets can lead to delayed payouts or, in sedate cases, insolvency.
ZachXBT reports liquidity and withdrawal issues at AscendEX via Telegram. Source: ZachXBT
AscendEX reserves are dominated by small-cap companies
Blockchain data for Arkham viewed by Cointelegraph on Friday showed that wallets marked AscendEX contained approximately $20.2 million worth of cryptocurrencies. Arkham-labeled wallets focused on smaller-cap assets and had relatively confined holdings of major cryptocurrencies.
AscendEx’s largest portfolio is UNITE tokens worth $10 million, followed by REUR worth $5.24 million, ASD worth $2.9 million and Reservoir rUSD stablecoins worth $600,000 and other smaller tokens.
Wallet with the AscendEX tag, the largest token resources. source: Arkham
Cointelegraph reached out to AscendEX for comment but did not receive a response prior to publication.
Questions about the exchange’s liquidity have been highly sensitive in the cryptocurrency industry following the collapse of FTX in 2022, when customer withdrawal requests revealed a multi-billion dollar shortfall that ultimately led to the exchange’s bankruptcy.
The outage triggered a wave of customer withdrawals across the industry, intensified regulatory scrutiny and prompted many exchanges to publish reserve confirmation reports to reassure users.
