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Bybit Boss Ben Zhou Denies Bankruptcy Rumors, Claims $11 Billion in Reserves, Arkham Chart Blamed

Last Updated May 23, 2024 1:18 PM
Teuta Franjkovic
Last Updated May 23, 2024 1:18 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Bybit’s Ben Zhou refuted rumors of the exchange being insolvent, providing proof of reserves to reassure users.
  • Rumors circulated on social media, triggered by a “misleading” proof-of-reserves graph from Arkham Intelligence.
  • The exchange faces regulatory challenges in France, with the AMF reiterating its ban due to non-compliance with French regulations.

Ben Zhou, CEO of the Bybit cryptocurrency exchange Bybit, has denied  claims to his platform was hacked and insolvent

On May 22, rumors began circulating, gaining traction and being amplified by a flood of memes  that echoed a popular post related to FTX, but this time targeting Bybit. However, Zhou posted what he said was proof of ByBit’s $11 billion reserves. This, in turn, led some crypto Twitter posters to suggest someone had used a chart from Arkham Intelligence in a “misleading” way.

Bybit CEO Dispels Rumors of Insolvency

After the rumors on Bybit being hacked and broke, Zhou reacted by stating  Bybit had updated its Proof of Reserves (POR) this month. He said all Bybit wallets, holding over $11 billion, are available to view through Nansen. He also said that none of the rumors were true and advised caution.

Some users made light of the situation by joking about withdrawing their funds  from the exchange. However, others sought to delve deeper into the details.

One cryptocurrency user speculated  that the rumor might have been triggered by a bug in a proof-of-reserves graph from Arkham Intelligence.

The graph in question gave the impression that Bybit’s wallets were being drained, leading to concerns over the possibility of the exchange being hacked or becoming insolvent. However, a closer inspection of the trading platform’s wallets independently confirmed that the funds were still in place.

Arkham Intelligence did not immediately respond to a request for comment.

CEO Shares Proof of Reserve

Additionally, Zhou provided tangible evidence to support his statement by sharing a link to Bybit’sPoR  and a Nansen dashboard  that displays all Bybit wallets along with the assets they hold. The PoR confirms that the trading platform possesses assets exceeding 100% of user deposits, assuring that the exchange has sufficient funds to cover all withdrawals should users decide to retrieve their assets.

Bybit reserves
Credit: Bybit

The data  from Nansen dashboard revealed that Bybit’s wallets contain over $11 billion in crypto assets. However, the analytics platform clarified that this figure was not a comprehensive statement of Bybit’s actual assets or reserves.

 

Nansen portfolio
Credit: Nansen.ai

Bybit Weathers FUD Storm: CEO’s Swift Response Calms Insolvency Fears

This incident unfolds amidst increased scrutiny within the crypto community, especially after the notable collapses of major firms like FTX and Celsius in 2022. These moves, have instilled a general sense of caution and skepticism regarding the stability of crypto exchanges.

Such rumors have historically affected not just Bybit but other exchanges as well. For instance, in December 2023, concerns about MEXC  escalated after the disappearance of the “MEXC_CEO” Twitter account. This coincided with heightened user complaints about frozen funds, fueling anxieties over the exchange’s financial health.

 

France Reiterates Ban on Bybit Amid Global Regulatory Scrutiny

CCN recently reported that the Autorité des Marchés Financiers (AMF), France’s securities regulator, has reiterated its warning  to crypto investors about Bybit. France has blacklisted the exchange since May 2022 for non-compliance with regulations. Bybit is banned in a total of 14 countries. On May 16, the AMF said the exchange provides digital asset services on behalf of third parties without the required registration.

Bybit, founded in 2018 and based in Singapore, does not offer services in several countries, including the United States and Russia.

Despite these restrictions, Bybit has continued to expand its global presence.  Since its inception, Bybit has become one of the world’s largest crypto exchanges, with a trading volume exceeding $71 billion.

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