Over the past few weeks, it has become apparent that digital currency exchange Cryptsy is facing some serious problems. While the official word is that the site is under DDoS, and hardware upgrades are being implemented to cope with the growing demand, a lot of Bitcoin community members feel this exchange is turning into a new Mt.Gox. After all, users can still deposit funds to Cryptsy, but withdrawing has not been possible for quite some time now.
Stop Depositing To Cryptsy – It’s For Your Own Good
One thing to keep in mind when getting involved in the world of Bitcoin and digital currency is that any funds spent from one’s wallet are non-refundable. This means that, if one were to send a few Bitcoins to anyone else on the network, there is no way of getting that money back if things go awry.
This scenario is especially true when it comes to using digital currency exchanges, as nearly all of them will act as an intermediary to hold customer funds. Whenever a problem arises with one of these exchanges regarding getting money out again, people should instantly stop depositing more funds into the platform.
Cryptsy, which is the example exchange in this story, also has the responsibility to stop people from depositing funds until they have all of their issues sorted. Unfortunately, that does not seem to be the case, which only leads to more frustration and speculation regarding what is going on with the platform.
Due to a server failure all wallets are paused. Will have them back online as quickly as possible
— BigVern (@cryptsy) November 22, 2015
Trouble started brewing for Cryptsy when a Twitter post mentioned a server failure, pausing all wallets active on the cryptocurrency exchange. This was back on November 22nd, and everything was scheduled to be resumed very shortly. However, that issue never got sorted, and things have only gotten worse from there on out.
Website offline due to denial of service attack. We are working to mitigate.
— BigVern (@cryptsy) November 25, 2015
Two days later, Cryptsy’s BigVern posted a message saying how the website was offline due to a denial-of-service attack. At that time, the wallet situation hadn’t been resolved yet, and a lot of platform users started getting worried. Getting funds out of Cryptsy’s wallet was – and still is – impossible at that time.
Thank you everyone for the patience while we get these issues resolved. Team is working hard and we will try to do more frequent updates.
— BigVern (@cryptsy) December 10, 2015
Over the past few weeks, things had quieted down on the Cryptsy front, with no updates whatsoever. That was, until December 10, when another Twitter update was posted to “thank everyone for their patience, and the team is working hard”. Not a message anyone is really happy with it, albeit it is an update of some sorts.
What’s Next For Cryptsy?
The big question is how the situation will evolve over the next few weeks. We can only hope that Cryptsy customers will be able to get their funds out sooner rather than later, but there does not seem to be any indication of that being the case anytime soon. For now, everyone will have to rely on sparse Twitter updates, and hope for the best.
That being said, Cryptsy can rest assured their already shaky reputation has taken a major blow because of these issues. In the Bitcoin world, it is not acceptable to hold customer funds hostage for such an extended period of time, without any proof of what has happened, or being done, to rectify the issue.
Are your funds stuck in one of Cryptsy’s wallets? Let us know in the comments below!