Key Takeaways:
- The four suspects were released since law enforcement has essentially decided that the Hotbit platform and the four users did not break the law in the GameFi project situation.
- According to a recent statement from Hotbit officials, withdrawals could begin in a few weeks.
The Hotbit exchange has been in legal difficulty since the very start of this month, blocked all withdrawal operations, and made significant declarations regarding the most recent developments.
It appeared to be disabled for trading and had “0” for user balances. Following a two-week waiting period, the stock market’s formal statement was released on August 28 by four former Hotbit workers who were the subject of a criminal complaint.
According to the official statement, all of Hotbit’s employees who were involved in the inquiry have safely returned to their homes. The incident occurred because a former employee of Hotbit’s team secretly joined a GameFi project in 2021. This seriously contravenes Hotbit’s internal policies.
The aforementioned individuals were identified as suspects due to the investigations conducted by law enforcement. The inquiry by the authorities revealed the following:
- A man who was employed by Hotbit and performed a crucial part in the GameFi project;
- Hotbit was the first to list the project’s token, and there was significant trading activity.
So, law enforcement officials investigated Hotbit on the theory that Hotbit might be the primary financier of this GameFi initiative.
Although the Hotbit team is “Decentralized” worldwide, four of its members—including one of its largest shareholders—live in the nation where the case was reported. So, at the end of July, law authorities hauled them away for an investigation.
Law enforcement also temporarily blocked access to several personal accounts belonging to the four individuals referred to as “sheep” in the blog post, including one on a significant cryptocurrency exchange, which led to liquidity issues for Hotbit.
For this reason, the account kept using Hotbit’s Market Making assets rather than Sheep’s private assets (from now on, referred to as MM). Early on in the course of Hotbit, the MM team used Sheep’s private account, which offered higher rates and may assist MM in giving Hotbit more liquidity.
Both former Hotbit officials’ personal accounts and stock market main accounts were frozen due to the inquiry launched in response to these concerns.
Because of law enforcement’s lack of knowledge of blockchain technology, all of the case’s proceedings moved slowly but to completion. It was determined that four former officials did not break the law.
Hotbit can hypothetically be restarted. The bad news is that the country’s judicial system immediately prevents assets from being unfrozen. Therefore, the Hotbit team must continue to consult with law enforcement concerning Sheep’s account unfreezing.
Consequently, around 70 different types of cryptocurrency assets connected to the case are currently frozen and cannot be fully withdrawn, but all other assets are fine.
The Hotbit team is currently seeking loan or merger opportunities. Hotbit is willing to discuss any other terms as long as the other party can guarantee that 100% of all user assets can be redeemed.
