Belgian cryptocurrency exchange Bit4You has suspended all operations, including withdrawals, amid an insolvency investigation of one of its main partners. The company explained the freeze in a blog post, claiming it was a necessary action to protect users of the platform , citing regulation against CoinLoan , a cooperative cryptocurrency lending service in Estonia:
“We would like to inform you that we have recently learned that one of our main service providers, Estonia-based CoinLoan, is no longer required to register as a virtual currency custodian.” Estonian regulators issued a cease and desist order on April 24, prohibiting CoinLoan from disposing of or releasing assets without the express consent of a designated “temporary insolvency practitioner.” This prohibits platforms from moving, releasing or disposing of assets or otherwise processing transactions without such permission. Bit4You cl aims that, as of April 26, it has “no indication that virtual currency held using CoinLoan on behalf of our clients will be irretrievable.”
In its announcement, the Bit4You team cited a CoinLoan blog post stating that the company believes it is capable of meeting its obligations: “Our legal team has provided sufficient arguments to demonstrate that CoinLoan is capable of meeting its obligations. Appoint ing an interim trustee seems to Be the easiest way for the court to find a solution, allowing an independent third party to verify the company's financial position."
The post also mentioned that the Estonian court's action was "unexpected" and would take effect immediately.
More than 145 Bitcoins in the list of bit4you users and company assetsurrently locked by the coinloan Suspension Order Bitcoin, Worth Over $ 4 miss the time of Publication. According to the Company's Blog Post, this accounts for more than assets in BTC.
Also frozen is 638,630 Cardano; 1,247,519 XRP; 1,097 ETH; and many other tokens. CoinLoan has said it intends to appeal the decision, but insists it must now abide by the Estonian court's cease and desist order.
