Due to an alleged theft that caused the company to lose more than $31 million, Bluebenx, a Brazilian cryptocurrency investment platform, this week ceased withdrawals. The withdrawals would cease for at least six months, the business declared. The Brazilian Securities and Values Commission (CVM) opened an investigation into the company in January.
Last Thursday, Bluebenx, a Brazilian cryptocurrency investment platform, suspended withdrawals on its website, affecting roughly 2,500 users. According to Assuramaya Kuthumi, Bluebenx’s attorney, the company claims it was the victim of a hack that caused them to lose more than $31 million.
Last Friday, the business sent emails to customers outlining the details of the withdrawal. An email stated:
“After repeated attempts to find a solution following last week’s extremely aggressive hack on our liquidity pools on the cryptocurrency network, we started our security protocol today with the immediate suspension of all BlueBenx Finance product operations, including withdrawals, redemptions, deposits, and transfers.”
“No information was provided regarding the attack’s nature, however, the email did state that these precautions would be in place for at least 180 days. According to information from a former employee that was gathered by a local source, Portal do Bitcoin, the business terminated all of its employees that same Thursday. According to the former worker’s testimony, more than 30 people were let go.”
Suspicions have been raised about the true causes of this withdrawal ban due to the hack revelation and how it corresponded with the company’s mass layoffs. Due to an alleged selling of unregistered securities as part of its investment portfolio, the business was under investigation earlier this year by the Brazilian Securities and Values Commission.
To encourage people to invest, the company provided high-yield investment products. According to consumer claims, several of these instruments did not reveal the investing strategy behind them. These products offered up to 66% for having invested cash frozen for a year. Concerns regarding the future of the funds held on the site were expressed by an anonymous consumer. He said: I believe there’s a good chance it’s a hoax.
Other Brazilian businesses have also claimed that their clients’ payments were stopped by hackers. This is the case with Trust Investing, which also stopped consumers’ withdrawals for nine months as a result of an alleged hack attack.
The Brazilian Congress is now debating a law that would toughen penalties for offenses involving cryptocurrency in an effort to deter businesses and people from selling phony goods and operating pyramid schemes.