KuCoin Executive Hits Back Against ‘Cheap Rumors’ After FTX Collapse

These rumors have been a contributing factor to a whirlwind of fear, uncertainty, and doubt (FUD) in the exchange and the cryptocurrency industry as a whole.

FUD is a term used to describe the negative feelings and emotions that arise among investors and traders. It can sometimes cloud their judgment or shift their opinions on a particular asset or market. 

Cryptocurrency exchanges are especially vulnerable to FUD due to unfounded rumors and speculation.

FUD Can Come In Different Shapes And Sizes

One of the most common rumors contributing to FUD in cryptocurrency is the fear of a possible government ban or restriction. Governments worldwide have shown skepticism towards cryptocurrencies due to their decentralized and unregulated nature. In response, rumors of potential crypto bans or restrictions have caused investors to panic and sell their holdings, and in some cases, cause the market to bleed.

Another common rumor is the fear of a hack or security breach. Cryptocurrency exchanges are a prime target for hackers due to the large sums of money stored in their wallets. A security breach can lead to the loss of investor funds and permanently damage the exchange’s reputation. Rumors of potential security breaches can cause panic among investors and traders, leading to a cryptocurrency sell-off.

Additionally, rumors about the manipulation of cryptocurrency prices have also contributed to FUD. Some investors and traders believe that market manipulation is widespread in the cryptocurrency industry, creating false price movements and a lack of trust in the market.

FTX Collapse Ignited A Separate FUD Line

The implosion of FTX, the now infamous crypto exchange and trading platform, created a contagion effect within the crypto community. Many other exchanges and investment firms had ties to FTX.

The demise of FTX also led to rumors of other exchanges being insolvent. One such exchange that was scrutinized was KuCoin. In spite of this, the exchange and its executives remain undeterred to counter these narratives. 

Mete Ulmet Elmas, the Head of Business Development at KuCoin, spoke exclusively with BeInCrypto to denounce these rumors. He called the rumors and FUD surrounding the exchange’s possible insolvency ‘cheap’ and denied any truth to them.

“KuCoin has been one of the exchanges that have been targeted by rumors most of the time in the past few months. But all those rumors are already proven wrong. I would say rumors are cheap, we take them seriously, but we are not afraid of them.”

Among other features, Elmas cited regular proof of reserve audits as evidence of KuCoin’s transparency and financial health. Proof of reserve reporting is a mechanism through which a crypto exchange can provide evidence of the funds that it holds and its financial health.

This normally involves publishing a report verifying the amount of cryptocurrency in the company’s wallets and comparing that against its liabilities.

Ensuring Transparency Amid Chaos

KuCoin uses the leading global audit firm Mazars for its proof of reserve reports. The latest findings concluded that KuCoin’s BTC, ETH, USDT, and USDC reserves are overcollateralized.

At present, BeInCrypto confirmed that the total collateralization ratio of the exchange’s asset holdings is 102%, 102%,100%, and 111%, respectively.

Source: beincrypto.com