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Proof of Keys’ Event

Jan 3, 2019

During the annual Proof of Keys’ event, all its participants withdraw their Bitcoin and other cryptocurrencies to their own wallets.

The purpose of the event is to identify unscrupulous market participants among exchanges and other services of storing and transferring cryptocurrencies. This event starts on January 3 at 4 p.m. GMT. At this moment, prices for the largest cryptocurrencies may decline. Everything will depend on the scale of the event this year.

Weaknesses have already been identified

A number of sources have already published information that the HitBTC marketplace is freezing the withdrawal of funds from its customers. Most of them refer to the posts of one of the users who wrote about this incident in a popular forum. Trace Mayer, the Bitcoin investor and host of the Bitcoin Knowledge podcast, also confirmed that HitBTC limits the withdrawal of funds from its customers.

On January 2, he wrote on his Twitter: BEWARE! Result: “Withdrawals are temporarily disabled on your account.” This is a message from one of his subscribers, which confirms that there are restrictions on withdrawal from HitBTC.

HitBTC is not the first time in a similar situation. Back in 2017, there were delays in the withdrawal of funds, but then representatives of the exchange explained this by a strong increase in new users.

In May 2018, the Karma Group filed a lawsuit against HitBTC for not fulfilling its obligations. In this case, we are talking about the listing of Karma tokens (KRM) and the attraction of 527.01 ETH. After a couple of months, HitBTC was at the center of another scandal – the founder of MGT Capital Investments and the creator of McAfee Security antivirus, John McAfee threatened legal action.

The reason for the legal threat was the unreasonable overstatement of the commission for the withdrawal of Docademic (MTC). It is clearly seen that problems with the withdrawal of cryptocurrencies with HitBTC are not so rare and it is not associated with the Proof of Keys’ event.

There is still no consensus

The opinions of many investors, analysts and traders significantly differ from each other. According to Bloomberg, entrepreneur and investor Lou Kerner believes that BTC can be a major savings tool. Nowadays gold performs this function with capitalization more than 8 trillion US dollars, while BTC has capitalization over 60 billion US dollars. The founder of the Reddit social network, Alexis Ohanian, also noted that Bitcoin is an attractive means of saving. All this indicates a potential increase in the cost of Bitcoin in the medium and long terms. A convenient and safe investment instrument for institutional investors is required to make this scenario occur. Bitcoin-ETF or its analogs can serve as this tool. But the SEC is still not ready to approve any of the submitted applications for the creation of an investment fund.

Therefore, until the ETF or its alternative are created, there is no need to rely on the massive involvement of institutional investors.  There is a risk of BTC price descending in the medium term.

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