Swan Bitcoin, a bitcoin-only trading platform, has faced recent struggles as the company transferred all its assets to two new custodians, Fortress Trust and BitGo Trust Company. Users of the platform reported significant outages that affected their ability to move assets easily, particularly impacting fiat on- and off-ramp services.
In a statement posted on its website, Swan Bitcoin announced the transfer of funds to its qualified custodians and confirmed the migration from Prime Trust and Fireblocks. Despite these problems, Swan’s CEO Cory Klippsten remained critical of rival crypto exchanges following the SEC lawsuits filed against Binance and Coinbase this week.
The root cause of Swan’s problems was not immediately apparent and it remains unknown whether they could be entirely attributed to the custodian switch. The company informed customers that the transfer of their assets commenced on May 26, coinciding with the outages. Swan believed that moving all assets at once would create the least amount of disruption for their clients.
As the custodian migration continued, Swan’s website listed a “major platform upgrade” as being underway since May 30. Klippsten assured clients that communication has been constant and detailed. He added that withdrawals of BTC and USD remained available through client service channels, and users’ ability to withdraw via the website or app directly resumed shortly after.
Swan attributed the custodial switch to plans the company had put in place back in January. Klippsten cited the firm’s rapid expansion into new products and markets as a reason for the change.
While the company faced its internal challenges, Swan Bitcoin and Klippsten voiced their opinions on the SEC lawsuits against Binance and Coinbase on Twitter. Both exchanges have denied any wrongdoing in response to the accusations.
Swan Bitcoin assured users that they implemented several measures to update customers on the status of their assets, including a “snapshot” feature providing customers with a placeholder update of their balances. As of June 11, the migration process is expected to be complete. The company plans to reopen in Texas and aims to bring Swan services to New York within three to six months.
It is essential for Swan Bitcoin to resolve its problems swiftly and maintain transparency with its clients. As the company strives to rectify its issues, the crypto community will continue to watch closely.
Source: Blockworks
