IDAX, a Chinese cryptocurrency exchange, has suspended deposits and withdrawals after its CEO allegedly disappeared in what looks like an exit scam.

In a blog post earlier today, IDAX said it was suspending all activity on the exchange after staff said they had been unable to contact their CEO, Lei Guorong, since November 24. As a result, the exchange has also lost access to its cold storage. IDAX initially denied that the disappearance was an exit scam; however, in another statement today, it has confirmed that this is indeed the case. An exit scam is a fraudulent practice by unethical cryptocurrency promoters who vanish with investors’ money during or after an ICO.

“Since we have announced the announcement on November 24, IDAX Global CEO have gone missing with unknown cause and IDAX Global staffs were out of touch with IDAX Global CEO. For this reason, access to Cold wallet which is stored almost all cryptocurrency balances on IDAX has been restricted so in effect, deposit/withdrawal service cannot be provided,” read today’s statement.

The situation comes after a difficult period for cryptocurrency in China after authorities doubled down on the country’s 2017 trading ban last week, with the central bank vowing to “dispose of” any exchanges it found in breach of the ban. The IDAX exit scam comes just a week after South Korean Exchange UPbit lost almost $50 million USD worth of crypto in an alleged hack.

The nature of the UPbit hack has led some speculators to believe that it may have been an inside job. Cointelegraph reporter Joseph Young tweeted, “The ‘hacker’ timed when UPbit was making crypto transfers to its cold wallet (other alts like TRON, etc.). Hence, I think the probability of it being an inside job is higher than external breach.”

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It is interesting to note that both the IDAX scam and the UPbit hack coincide with not only with the Chinese government’s clampdown of crypto but also at a time when Bitcoin’s value is bearish, with many analysts speculating that further declines are still to come.

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Bakkt futures trading volume hit a record high of 4,269 BTC in a single day; however, very little Bitcoin has actually been physically settled on the exchange.

The launch of the futures trading exchange from the Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, was one of the most highly anticipated events on the 2019 crypto calendar. However, Bakkt got off to a sluggish start and traded only 623 futures contracts in the first week of launch in late September. Volume has started to pick up pace in recent weeks, hitting ~$37.45 million on Wednesday, passing its previous high of ~$19.96 million on November 22.

The interesting thing about Bakkt’s platform is that its futures are physically settled, meaning all trades are settled in Bitcoin rather than the cash equivalent. The catch is that very little Bitcoin has actually been settled by the exchange. According to trader Alex Krüger, in the months of October and November, Bakkt has delivered just 32 BTC, worth $242,000 at today’s prices, for its monthly futures.

Bakkt’s physically settled futures contracts are considered a revolutionary concept for the future of Bitcoin as it means institutional investors will end up holding Bitcoin in their portfolios rather than the cash equivalent, meaning real crypto adoption on Wall Street. “The more regulated volume, the better. Bakkt’s growth is very positive. Yet keep present Bakkt is not that different from the CME. It is almost entirely paper trading,” said Kruger.

>> Bitcoin Corrects 45% from Highs: Is the Correction Over?

Bakkt will launch cash-settled futures on December 9 in an effort to get closer to its biggest rival, the Chicago Mercantile Exchange (CME). The CME has offered Bitcoin futures for nearly two years, and in Q3 of this year, it averaged 5,534 contracts per day, equal to 27,670 Bitcoin, worth $289 million at the time. However, CME settles its contracts with fiat currency, a direction in which Bakkt appears to be heading.

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