Hotbit Bites the Dust | Brief Overview

Written by Joe Parkin

Joe is COO of FCF Pay, an experienced entrepreneur and is passionate about using blockchain technology to make the global economy more inclusive and fair.

The CEX Hotbit has announced that it is ceasing operations. Let’s have a brief look at their motives and what this means for the industry.

Tweet from Hotbit:

A quick browse through reveals the following reasons given for the closure: 

  1. During August 2022, Hotbit was forced to suspend operations for several weeks during an investigation. Despite finally being cleared to resume operations, this was a major blow to the company.
  2. The collapse of FTX, temporary depegging of USDC, crises in the banking industry, etc. led to many users removing funds from centralised exchanges, preferring self-custody.
  3. Uncertain or even hostile regulatory and market conditions.
  4. Constant threat of cyber attacks and malicious users.
  5. The complications of managing risk with so many different assets.

Quite honestly, I think anybody that works in this industry can relate to these concerns. While it is true that there are great opportunities for those companies that are able to navigate the constantly shifting peaks, valleys, storms and droughts that the blockchain/web3/crypto space throws at them, it most certainly can feel like an uphill battle.

What does the Hotbit closure mean for the industry?

Honestly, without wanting to sound harsh or dismissive, I ultimately don’t think it will make a huge amount of difference. I personally believe that the CEX industry is overcrowded in any case. By the very nature or the centralised crypto industry, there is intense competition and it will be bound to display ever-increasing levels of centralisation and monopolisation, just as we see in other sectors. Very simply, that’s capitalism!

CEX; the banks of the cryptosphere

Just to finish off this very quick crypto newsflash, I feel I should mention something. CEX are in many ways like banks. Even the FTX collapse was due to – in my honest opinion – typical banker-like behaviour.

It’s not the whole banking industry that behaves this way, but as institutions I would be interested to speak to anyone that would not be willing to admit that they have tended to over-lend, over-leverage and become over-reliant on central banks to bail them out at the expense of everyday citizens.

Part of our mission here at FCF Pay is to provide an alternative to CEX for normal users; a set of hybrid centralised and decentralised tools that make it as easy – or even easier – to get into crypto than centralised exchanges do, but also provide simple options to use self-custodial wallets and on-chain transactions. Oh, and we will NEVER use our users’ deposits for our own operations (screenshot it!). You can never have a liquidity crisis – the crypto equivalent of a run on the bank – if you simply leave people’s money alone! 

Leave your own thoughts in the comments. We’re always delighted to hear your opinions.

SEC vs. Binance, Coinbase, etc. | Who are they protecting?

SEC vs. Binance, Coinbase, etc. | Who are they protecting?

Personal opinion disclaimer Before I continue, I just want to make it extra clear that any and all opinions expressed in this short article are my own and are not an official communication by FCF Pay. They are intended to spark constructive debate.  I cannot guarantee...
FCF Pay Crypto Bill Payments – Success and Misconceptions (Read this, XRP and Shib Communities!)

FCF Pay Crypto Bill Payments – Success and Misconceptions (Read this, XRP and Shib Communities!)

XRP and Shib Communities, please read carefully! Last week, we launched our crypto bill payments service for US residents. As is the case with any product launch, we programmed some tweets showing off the amazing possibilities that this system makes possible. We...
Basic Crypto Security | Avoiding Scammers

Basic Crypto Security | Avoiding Scammers

Introduction IMPORTANT! There is nothing inherently dangerous about cryptocurrencies. In fact, they are inherently secure. This article is mainly about how to avoid scams and scammers. In fact, everything in this article is caused by people, not the technology itself....
The next generation of payment technology (and why it matters)

The next generation of payment technology (and why it matters)

The evolution of money and payments A large part of people’s day to day lives revolves around the exchange of goods and services for other goods and services. In our work, we produce products or provide services that others want or need and spend the money we earn on...
Centralised systems in the blockchain economy

Centralised systems in the blockchain economy

The Argument Against Centralisation People are fed up of middlemen. Specifically, more and more people are sick of banks and other financial institutions. Every time we pay for something, there’s a long list of companies processing it, each one of them taking a cut....
Crypto Bill Payments – A Big Win for the Unbanked

Crypto Bill Payments – A Big Win for the Unbanked

Launching 19th September 2023 We are very proud to have recently announced the upcoming public launch of our Crypto Bill Payments system. This super-convenient blockchain-based APM (Alternative Payment Method) makes it possible to pay bills to around 21,000 companies...
Becoming the World’s Top Crypto Payment Gateway

Becoming the World’s Top Crypto Payment Gateway

How will FCF Pay become the leading payment gateway in the blockchain-based payments industry? Is it even possible for cryptocurrency payments to take on the traditional fiat-based payment gateways?   Here’s some food for thought:   Payments; a Surprisingly...
Separating Money from Politics

Separating Money from Politics

Introduction This is the most important topic I have ever written about. In fact, I honestly believe that it’s one of the most important subjects for our shared future. The separation of money and politics is a shift that will have a profound impact on the lives of...
Want to tax cryptocurrencies? Encourage crypto payments!

Want to tax cryptocurrencies? Encourage crypto payments!

Ok, Governments… Let’s talk straight!  We all know that one of the reasons a lot of you guys are pushing back against cryptocurrencies is that you are concerned about everyday folks partaking in money laundering; a pursuit generally reserved for the rich and powerful....
Virtual Card Interruption & Why USDT TRX for Refunds?

Virtual Card Interruption & Why USDT TRX for Refunds?

What has happened? As many of you are aware, we have had to interrupt our virtual prepaid card service. Physical cards have been active and functioning throughout. First of all, I’d like to give a little perspective as to why we decided to interrupt the service. There...

8 Comments

  1. Jay Kay

    Very interesting Joe. Another great post. Keep them coming.

    Reply
  2. Lee

    Won’t touch customers money, that’s refreshing but I guess if banks and CEXs use these funds to create a profit. How would FCF create a profit if they aren’t using those funds like the rest do?

    Reply
    • Travis

      Like any other payment gateway, whether fiat money or crypto, FCF creates profit through a small fee on reloading virtual or physical cards. Not only does FCF create a profit for its self as a business but also a portion goes to the holders. The more I read about FCF and what its trying to accomplish the more I’m astonished how undervalued this company is. The fact that FCF is able to bring utility to this space where 99% of crypto is built on hype and no real purpose amazes me.

      Reply
    • Alex

      Thanks for giving us an info (as I don’t follow everything closely) on relevant events in the Cryptosphere.

      Also excellent to have a short Evaluation including an arc to FCF.

      Keep up your great progress!

      Reply
      • joe

        Thanks, Alex! I’m not sure how many news posts I’ll be able to do. Basically, I’ll post what jumps out at me from Twitter and comments on Telgram.

        Reply
  3. Misha

    Hotbit reports that centralized exchanges (CEX) are becoming increasingly cumbersome, with highly complex and interconnected businesses that are difficult to comply with, whether for compliance or decentralization, and are unlikely to meet long-term trends. But what are the long-term trends?

    Reply
    • joe

      Honestly, that confused me somewhat also.

      I think I know what they mean with the increasingly interconnected businesses. At some point I’ve seen with my own eyes how the centralised crypto industry + the on and off-ramping industry are turning into a hot mess that are over dependent on a few suppliers. I might get into that stuff in future posts, but it’s a topic that is pretty touchy NDA-wise and FUD-wise. It’s basically what happens when the wrong people from the traditional finance world smell that a quick buck can be made.

      The trends part of the statement just sounds like canned corporate nonsense to be honest, although I can’t be sure.

      Reply
  4. Mike

    Sad to see but it’s the name of the game, especially in a bear market. Great article as usual! Nice to know that the FCF app won’t touch user funds, one of the most important things imo. Keep it up, can’t wait for the app!

    Reply

Submit a Comment

Your email address will not be published. Required fields are marked *

FCF Pay > Zypto Pay

FCF Pay is now a Zypto company. Please visit zyptopay.com and zypto.app to learn more about Zypto.

You have Successfully Subscribed!