Cryptocurrency exchange Cryptsy has been experiencing problems recently, the apparent result of a series of unfortunate events which has culminated in freeze on withdrawals and markets, the removal of Cryptsy from some cryptocurrency pricing websites and rumours of an imminent closure of the site: could Cryptsy become crypt-sy?
Issues have been reported with Cryptsy’s exchange for a while, with users claiming to experience significant delays in withdrawal times and inaccessible. Last year, in November and December Paul Vernon, CEO at Project Investors Inc. (who operate Cryptsy) reported denial of service attacks as causing issues and today posted to say that there was a problem with a phishing attempt, resulting in the temporary cancellation and blocking of withdrawals. On the Cryptsy blog, Vernon claimed that a weak password of provider Twilio had led to a security breach with SMS messages being sent out in a phishing attempt. In addition to this, phishing e-mails were acknowledged; however, Vernon stated that the method the scammers had used to obtain the e-mail list was unknown and it was not sent from the Cryptsy account.
Since the start of the year, a number of companies and services have taken steps to sever ties with Cryptsy, responding to concerns from users and the problems with accessing assets on the website. Multipool, a crytptocurency mining pool, began to report concerns with Cryptsy’s service in December and has recommended its users avoid it, temporarily disabling auto and daily pay-outs to Cryptsy users. Likewise, CoinMarketCap removed Cryptsy its site after the complications became known, stating that it would be re-listed once the issues had been resolved. Others also appear to be following suit.
These problems have led to a multitude of rumours on sites such as twitter and reddit that Cryptsy may not have long left. Besides the difficult accessing money on the website, it also came to light that Vernon is going through a divorce, in which Cryptsy is listed as a 3rd party defendant, giving rise to speculation that Vernon’s private life may be impacting his running of the company, and posters predicting that Cryptsy will go the same way as Mt. Gox. Regardless of the conjecture that has been traded back and forth, the end of Vernon’s message on the Cryptsy website stated that he would be writing a post in the next couple of days to explain the issues that have been plaguing Cryptsy since the end of last year.
Update: Information disclosed to allcoinsnews has revealed that in the divorce proceedings, Vernon’s wife required financial support and as part of the divorce settlement the court has required Vernon to disclose all his financial information. In addition, Jinyao Liu is seeking damages based upon the alleged unlawful conduct of Cryptsy, Vernon and Project Investors Inc. in denying account holders the ability to obtain funds in their accounts and in misappropriating funds held in the Crypts accounts, on behalf oh himself and other individuals who are Ina similar situation.