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- A South African cryptocurrency investment company has frozen a portion of it's customers' assets.
- This comes as withdrawals and deposits at a South Korean partner company suspended deposits and withdrawals from its platform earlier this month.
- The SA company said that it was committed to resolving the issue quickly.
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Revix, A South African cryptocurrency investment company, has frozen 24% of its customer's crypto assets owing to trouble with one of their primary service providers.
Revix was started in 2019 and is one of a host of South African companies offering investors exposure to cryptocurrency.
But, like other South African cryptocurrency firms, including Luno and VALR, Revix partners with foreign cryptocurrency providers for certain business functions.
One of Revix’s partners is a South Korean-based crypto company called Haru Invest. Haru holds a portion of Revix-controlled customer assets.
And earlier this month, on 13 June, Haru suspended all deposits and withdrawals from it’s platform after it discovered that one of its partners, B&S Holdings, had been deceiving Haru and its customers by fraudulently providing management reports containing false information.
Haru said that it had filed a criminal complaint against B&S on 14 June.
Revix holds 24% of it’s customers' crypto assets with Haru.
Haru’s suspension of deposits and withdrawals is applicable to these Revix customer's assets, which is why Revix said it had no choice other than to render these crypto assets as "reserved", meaning they can’t be traded or withdrawn from the platform.
This is applicable to the amount of crypto held by customers as of 13 June.
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The other 76% of customers' crypto assets were fully accessible, said Revix.
"The balance of customer assets - comprising 76% of crypto holdings and 100% of fiat cash balances - are securely held and are within our customers’ control on our platform, enabling them to hold, trade or transfer these assets if desired," said Revix in a statement.
Delayed response
Revix released the announcement about the reserved assets yesterday on 28 June – 15 days after Haru suspended withdrawals and deposits on its platform.
Revix said that a careful approach was required on their part before informing customers of their frozen funds.
"We felt it crucial to take time to gather enough data to get a clearer picture of the scenario," said the statement.
"It was essential to gain further clarity and certainty from Haru Invest before sharing this update. This exhaustive evaluation was crucial in helping us derive the most appropriate course of action to best mitigate the obvious adverse impact of this matter."
Going forward
Revix said it was committed to resolving the issue as quickly as possible and was in discussions with Haru.
It added that it was confident that the recovery of assets held by Haru was attainable, which would unlock the reserved assets.
"We assure you that we will pursue every possible course of action within our legal purview to reclaim these assets," the company said.
