Obscure Problems Crypto Users Can Face, Explained

There is always a risk of this — and even big exchanges aren’t immune.

As a case in point, take a look at Bitfinex. At the time of writing, according to CoinMarketCap, it was the 25th-largest crypto exchange by trade volume. But, despite its popularity, disgruntled users have claimed they have experienced long delays when trying to make fiat withdrawals on the platform. As Cointelegraph reported back in November, its concerning performance has drawn parallels with the fate of Mt. Gox — a now-defunct exchange after suffering a major cyber attack.

There have been calls for the exchange to be more transparent about its business practices in order to assuage the fears of concerned crypto holders. Some exchanges have begun to capitalize on this by showing customers full details of how they handle money — with real-time updates on transaction volumes and assets in reserve.

Indeed, issues with withdrawals may have nothing to do with your crypto exchange at all. In some cases, banks and financial institutions may intentionally block such transactions coming in from exchanges because it could put their license at risk or land them in hot water with regulators, resulting in eye-watering fines. This can be because they are obliged to verify identities and prevent money launderers or fraudsters from using their services.

Like with any financial decision, it’s crucial to do your due diligence before committing to an exchange. Don’t always go with the biggest platform. Instead, read impartial reviews from those who currently use a service — and always research an exchange’s approach to transparency, as well as the fees and waiting times they attach to withdrawals. Also, make sure your bank won’t go into a meltdown.