The blockchain industry has been a game-changer, to say the least. Over the past few years, cryptocurrencies have had a positive impact on people’s lives, including mine. That’s why I strongly support cryptocurrencies and their ability to provide financial freedom. This is why MicroStrategy CEO Michael Saylor’s description of Bitcoin as “digital gold” really resonates with me.
However, I have had my fair share of unfortunate experiences in this nascent industry, and none have been as terrible as what I’ve gone through with Bitget. Let me share the details of this ordeal, where Bitget seized over $200,000 of my money, caused over $2.5 million in losses, and, in my estimation, more than $10 million in reputational damage.
You would think that a large exchange like Bitget would prioritize transparency, but unfortunately, that’s not the case. Lack of transparency has been the downfall of many crypto exchanges, and we can still remember the painful example of FTX.
According to reports, FTX CEO Sam Bankman-Fried transferred up to $10 billion of FTX customer funds to his trading company Alameda Research without the knowledge or approval of the customers. These funds were primarily held in FTX Token (FTT). When Binance CEO Changpeng Zhao announced that Binance was selling its stake in FTT, it caused panic among customers, leading to a bank run and ultimately the bankruptcy of the FTX Group.
Now let me share my personal experience with Bitget. I’ve been using Bitget for some time now, but in the first quarter of this year, they prevented me from withdrawing my tokens, even though I was fully compliant with Know Your Customer protocols.
The issue arose when I started advising a project called ReelStar in October 2022. My advisory role was publicly announced, and it was also known that I would be compensated with the project’s tokens. Unlike many celebrities who promote unfamiliar projects for dollars, I only get paid when the project’s token increases in value. As an advisor, I bring more than just influence to the table. I connect projects with partners, bring capital, and ultimately enhance credibility.
On March 23, it was time for ReelStar’s token, Reel Token (REELT), to be listed on exchanges. Bitget charged a significant amount of money for this listing. As an advisor on the project, I had been promised compensation in the form of REELT tokens. Since I hadn’t earned anything for my work, I sold less than 3% of my personal REELT holdings, which accounted for less than 0.03% of the total REELT supply, with the approval of ReelStar’s founders.
However, my funds, including Bitcoin and altcoins I already had on the exchange, were blocked without any explanation. Despite my efforts and the involvement of my attorney, Bitget has refused to inform me and I am now filing a lawsuit to determine if they stole my funds.
I have no idea where my funds are at this time. It’s possible that Bitget is using them for their own investments and planning to keep my money permanently.
At first, I thought it was an error that could be resolved with Bitget, but I soon realized it was not a mistake. This situation reminds me of what happened with FTX, where I lost over $2 million. I was asked to share my thoughts on what went wrong with FTX, and now I see similar patterns with Bitget. Users should be cautious and consider what this could mean. I’ve already been burned once, and I believe I can raise questions about this exchange.
It’s also concerning that Bitget has hired a former host from a state-owned Chinese television network, Gracy Chen, as a key public face for their business. We know very little about Bitget’s executives, their actual owners, or their management team. Who is in control of the user funds held by Bitget? These questions are not being asked enough, and the exchange is not providing satisfactory answers.
Furthermore, Bitget has followed a dangerous precedent set by FTX by bringing on non-expert celebrities like actor Adam DeVine and Lionel Messi to market their services. This reliance on influencers and marketing without prioritizing the back-end work was one of the reasons for FTX’s downfall.
Bitget’s reserves are also heavily dependent on their native token, Bitget Token (BGB), similar to FTX’s reliance on FTT. This makes the exchange vulnerable if the price of their token falls.
Recently, GPT Guru accused Bitget of sabotaging the listing of their token, GPTG, on the exchange. GPT Guru claims that Bitget listed the token at a much higher price than agreed upon, causing significant losses for investors. Bitget initially agreed to compensate the affected users but later deleted their messages and stopped communicating with GPT Guru.
These actions reflect poorly on Bitget as a crypto exchange that holds control over users’ funds. It raises concerns about their future behavior and whether they can be trusted. In a time of market uncertainty and increasing regulatory scrutiny, we deserve transparency and guarantees from the exchanges we use.
The central question for crypto exchanges is what legal obligations they have towards their users, if any. My lawsuit against Bitget aims to find answers to these questions.
Disclaimer: This article is for general information purposes only and should not be taken as legal or investment advice. The views expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.