Cubits Cryptocurrency Exchange Shuts Down

Cubits, a digital asset trading platform based in London, has been forced to shut down its operations. This is after fraudsters allegedly stole about $32.5 million from the platform way back in February. The exchange company pointed out that “it fell victim” to a major scam that was planned and executed by three of its clients.

Voluntary administration entry

Cubits is going through a phase of administrative entry where depository and withdrawal services are suspended till further notice. Theworth of Bitcoin held up on behalf of customers at the time of closure remainsunknown. After trying every move possible, the exchange claimed that itcouldn’t recover from the “criminal act.”

Despite many efforts to get the company back on its feet, officials stated that the well-orchestrated scam crippled the business and the decision of its closure was inevitable. The criminal act was said to have included three Chinese traders who purchased BTC through Cubits using PaySecure Online (Paysec). The Malta-based payment processor, Paysec, never submitted the funds to Cubit. A lawsuit has since been filed by the exchange in a bid to force Paysec to pay the amount it owes cubit. That amount is allegedly $39.2 million which includes money from the three Chinese traders as well as other debts.

A host of financial authorities were involved including those from U.K, Malta, China, and Germany but none of them helped in finding a solution.

Fruitless efforts

Administration, which is bankruptcy in other words in the U.K, will give the exchange time to restructure during this financial distress. It was the only option the company was left with after continued efforts to recover bore no fruits. The exchange remarked, “This decision secures the current position while the administrators seek offers for the business and its assets,”

Despite the company’s platform going offline, the officials urged users to remain calm as there was nothing they could do after failed attempts to recover the funds.