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The Exchange Become A Potential FTX Replacement

In the aftermath of the FTX debacle, centralized crypto exchanges have been thrust into the limelight. Analysts and crypto sleuths are currently scrutinizing the cryptocurrency

Hong Kong-based is under scrutiny as blockchain sleuths and on-chain specialists investigate its history. Recent suspicious transactions conducted by the exchange have also raised red flags.

On November 15, Lookonchain put up some interesting information about the exchange. The problem started when was hacked in April 2018, costing $230 million.

One of the first things the exchange did, it seems, was an attempt to hide this. On November 15, crypto sleuth ZachXBT pointed out the following in response to founder Lin Han:

Looking Into

Lookonchain looked into’s reserves and found even more differences.

It discovered that only had $479 million in reserve assets after analyzing the exchange’s four Ethereum wallets.

There were 71 million GT tokens with a market value of $259 million and 3.1 trillion SHIB tokens with a market value of $29 million. More than sixty per cent of’s total reserves consisted of these two dubious assets. Moreover, just 21% of its assets were held in Ethereum and Tether (USDT).

Additionally, some fraudulent transactions were discovered. On October 21, received from 320,000 ETH worth well over $400 million. Between October 25 and October 30, the exchange transferred back to 284,975 ETH, valued at $359 million.

It looks like this was a mistake, but there was no mention of the 35,025 ETH that was still missing. What Lookonchain discovered:

“The transfer of 320K ETH happened around the time released the Proof of Reserve Evaluation Report.”


Binance CEO Changpeng Zhao warns:

If an exchange has to move large amounts of crypto before or after demonstrating their wallet addresses, it is a clear sign of problems. Stay away.


In addition, claims to have been audited by the same firm that audited FTX, Armanino. However, the report was headed “Agreed-Upon Procedures Report” and not “Reserves Audit.”

Lin Han tweeted on November 15 that the audited proof-of-reserves for Ethereum was 269,035 ETH.

However, given the precarious state that the sector is in right now, users of centralized exchanges are naturally on edge.

According to data from CoinGecko, the exchange does $928 million worth of business every 24 hours. According to the total volume of its trade, this places it eleventh among the largest. The price of a GT token has decreased by 15% over the past week, and it was trading at $3.70 at the time of publication.


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