Event Overview: Withdrawal Anomaly and Liquidity Concerns
User reports indicate that AscendEX (formerly Bitmax) has recently faced widespread withdrawal issues. Funds remain stuck in an 'Initiating' state for extended periods, without any corresponding on-chain transaction hash. This condition is widely interpreted by the market as a sign of liquidity depletion—meaning the platform may be unable to fulfill withdrawal requests, trapping funds in its internal system rather than sending them out on-chain.
Past Security Incident and Transparency Deficiencies
Notably, this is not the first crisis for AscendEX. In 2021, the exchange suffered a $78 million hack attributed to the North Korean Lazarus group. Although the platform managed to resume operations after securing new investments, it has never published a Proof of Reserves or undergone a third-party audit, keeping its transparency at a low level compared to industry peers. This information asymmetry further amplifies user concerns about fund safety.
Industry Context: The Common Predicament of Mid-Small Exchanges
The AscendEX incident is not an isolated event. With regulatory tightening (e.g., MiCA, US state licensing requirements) and the dominant position of top-tier exchanges such as Binance and Coinbase, small and medium exchanges face mounting survival pressure. Rising customer acquisition costs, higher compliance thresholds, and limited liquidity and market-making resources make these platforms vulnerable to bank-run risks when technical issues or market volatility occur. AscendEX's current situation epitomizes this industry-wide struggle.