An obscure platform, WhiteBIT, drawing connections to Justin Sun, a renowned cryptocurrency industry figure, has generated alarm bells with its promise of an astounding 24.8% Annual Percentage Yield (APY) for users depositing Tether for a year on its lending platform. This rate stands at thrice the average USD money market rate and poses as a stark warning for prospective investors.
WhiteBIT’s ties to Justin Sun and his Huobi exchange, from which a regular flow of funds is observed, may explain the inflated APY. Having a track record of promoting questionable stablecoins with high returns, Sun brings an added layer of scrutiny to this platform. Instances include Sun’s past promotions of returns from 150% to 392% on his USDD stablecoin, 2,366% on USDJ, 30% on USDC, and 23% on TUSD.
Although boasting a range of over 150 cryptocurrency trading pairs, what raises eyebrows is WhiteBIT’s ‘lending’ feature offering interest rates surpassing 24.8%. The platform has recently reported holding $1.59 billion in digital assets, with its WhiteBIT Coin (WBT) accounting for a substantial portion. Despite this, the likelihood of users choosing to hold 99% of their assets in WBT, tags a question on the token’s validity and the overall credibility of the exchange.
One key advantage WhiteBIT does embrace is it’s access to fiat on- and off-ramps within Ukraine and Kazakhstan, allowing stablecoin conversions to fiat in these areas, a rather unique feature. A checking account in these countries with a U.S. banking relationship is even rarer – an attribute that adds to WhiteBIT’s appeal.
Nonetheless, the platform has struggled to maintain licenses and banking relationships, its two European licenses from 2019 have agonizingly hit ‘404 Not found’ errors. There have been instances of delays in withdrawals, which inevitably breed concerns over the platform’s stability.
The co-founders of WhiteBIT, Vladimir Nosov and David Tunian, lack the conventional experience attributed to crypto executives, with scanty information available about Nosov on his LinkedIn profile. Despite the exchange’s association to high-profile events like the Eurovision 2022 and Ukraine’s military efforts, a higher degree of analysis is warranted when assessing its practices and affiliations.
In conclusion, the enticingly high returns projected by the WhiteBIT exchange, coupled with its associations to well-known cryptocurrency figureheads, necessitate thorough scrutiny. Although seemingly profitable, its history, handling, and offerings are a cause for vigilance for informed investors.
Source: Cryptonews
