Okcoin has suspended trading of New York’s and Miami’s crypto CityCoins as of March 16, 2023, because of limited token liquidity.
Okcoin, a crypto exchange platform, announced that it would no longer facilitate trading, buying, or selling of MiamiCoin (MIA) and NYCCoin (NYC) from March 16, 2023, at 11:59 pm PST.
The self-proclaimed “global cryptocurrency exchange with the lowest fees around” said the suspension would remain unspecified until Okcoin safely restores trading.
NYCCoin and MiamiCoin suspended on Okcoin
Okcoin cited potential fraud risks and price manipulation for the suspension. Trading will only resume if Okcoin addresses all the potential risks and has established ways to protect the platform users.
However, the platform allowed the holding, withdrawal, and trading of these coins on the ALEX decentralized exchange. NYC or MIA holders are assured of their coins’ safety and are secured by the platform’s industry-leading security.
“Low liquidity risk” concerns
Okcoin said that its security team noted that the platform’s exchange markets for MIA and NYC had unforeseen low liquidity levels. The team raised concerns that spiteful, third-party actors might launder siphoned funds, manipulate prices, and commit other frauds.
While one of the frauds has occurred, Okcoin wants to stay vigilant, calling for improved CityCoins liquidity from market makers and suspension before the deficit is rectified.
The platform aims to protect its integrity by securing user funds hence the announcement.
CityCoins are local, decentralized, programmable currencies developed by Patrick Stanley, Blockstack’s former Head of Growth.
MiamiCoin (MIA) and NYCCoin (NYC) are endorsed by the respective cities’ mayors, who campaigned that digital assets had a greater good for society. The coins are proof-of-work coins, and users can freely mine them. However, there is an incentive with mining the coins – 30% of the fees spent on the mining will go to the city.
New York City and Miami are the first cities to authorize and launch CityCoins. Okcoin is the only centralized exchange platform allowing trading of the CityCoins, and ALEX is the affiliated decentralized exchange.