Australian Bitcoin Industry Weighs up Code of Conduct as Igot Exchange Nears Collapse

Bitcoin Exchange Igot Regulations
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The Australian Digital Currency and Commerce Association (ADCCA) is recommending a code of conduct for bitcoin companies on account of the inability of the Igot bitcoin exchange to deliver bitcoins people paid for or refund their money, according to ABC.

Igot clients said the exchange owes them hundreds of thousands of dollars. The exchange has been unable to deliver on purchases or provide refunds for months. The exchange was launched in 2013, according to its website.

Nicholas Giurietto, ADCCA chief executive, said Igot customers have been devastated. The association expects to have a code of conduct published in a few weeks to stop users from losing money from bitcoin companies that fail, even though Igot is not an association member.

Igot Owner: Money Isn’t Lost

Rick Day, the owner of the exchange, told ABC he was struggling to pay customers. He said he is aware customers are affected and unhappy, but he wanted to assure them the exchange has not lost their money.

“We have not run away with anything and we will return the money,” Day said.

Akram Bekzada invested with Igot in 2014 and has been trying to withdraw $13,000 worth of bitcoins since last October, according to ABC. He said Igot is not being transparent about the issue.

No Legal Recourse with Bitcoin

Bekzada said he filed complaints with the Australian Securities and Investment Commission and the Australian Competition and Consumer Commission, both of which said there was nothing they could do. Bekzada said regulators should be “ahead of this game” instead of waiting to decide who should be in charge of such problems.

Zhenya Tsventnenko’s company, Digital CC, is owed $180,000, and has taken court action, according to ABC.

Owen Champion, a software developer, tried for months to withdraw $7,000 worth of bitcoin from Igot. After posting online that he was interviewed by ABC, he received half of his money.

Giurietto said Igot appeared to have let its customers down “really badly.”

ADCCA Calls For Change

Any growing industry has players that are not reputable as some would like, Giurietto added. He noted that the ADCCA was started by larger bitcoin exchanges in Australia to give consumers confidence.

The group is advocating a voluntary code to reassure bitcoin users. The code will take consumer protection to a new level, Giurietto said. The code includes an obligation for businesses to belong to an external dispute resolution scheme so there will be a way to manage complaints fairly, in addition to an obligation to address privacy and data security standards.

Giurietto said in the Igot situation, an ADCCA certified operator would have to maintain a trust fund in which customer funds must be deposited until the bitcoin order the customer placed gets fulfilled.

Also read: Australian banks cleared of colluding against cryptocurrency companies

Website Claims DDoS Attack

Igot’s blog Monday evening said a sustained distributed denial of service (DDoS) attack caused restrictions in its ability to process transactions in the normal time frame. It said the site uses standard DDoS protection, but in this case it has not been effective.

“Our team has minimised the attack’s severity, but more remains to be done. We hope to return to a normal service very soon. Please keep an eye on our Facebook and Twitter feeds for updates as the situation changes.”

Igot has locations listed in Australia, Slovenia, India, Singapore and Hong Kong.  CCN reported in August of 2014 that Igot launched Dubai’s first bitcoin exchange.

Featured image from Shutterstock.

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