Another lesson for those that are using custodial exchanges and wallets

[_act_]

I do not know if Wyre is a custodial wallet or an exchange. I decided to post this on beginners and help for the beginners to learn another lesson which is not new again. But moderator can decide to move it to the appropriate board.

This is not about hack but it is about not you key not your coin. On noncustodial wallet, you are the owner of your coin, unlike on custodial wallets and exchanges that you are not the owner because the keys are not yours.

See the interesting news:
https://cointelegraph.com/news/wyre-imposes-up-to-a-90-withdrawal-limit-for-all-users

Wyre users are able to withdraw, but they can only withdraw 90% of their money. Assuming you have $1000 on the exchange, you can not be able to withdraw $100 and Wyre users will be panicking about their money by now. Can you see that the more money they have on Wyre, the more money they can not be able to withdraw. On noncustodial wallet, you can send all your coins on the wallet at anytime.

[EarnOnVictor]

Another big lesson indeed! Well, thank goodness that I already know BTT, I would have been a victim of such as close as early last year. It's so bad to hold one's crypto in any centralized/custodial exchange/wallet, this is part of the repercussions. For those looking for trusted wallets, @theymos advice here will do a lot of good: https://bitcointalk.org/index.php?topic=5421039.msg61293646#msg61293646

And for clarity, this (Wyre) is not an exchange but a payment platform, it's clearly stated in the article. Can you imagine having $20,000 in such a payment platform and waking up to the news as shown in the image below:



It's just yesterday's event, so new. This is a company that was founded in 2013 and has built the trust of many, only to swindle them with their money when perhaps the amount to gain through it is now much. This is preposterous, unfortunately, such would continue to happen unabated. And see what I found on Google while inquiring about the Wyre company with some search words.



The company has processed over $1 billion as of October 2020, how much more thereafter?

This is why I like to advocate for more regulation of cryptocurrency, particularly the centralised ones so that anyone would not just cheat people under any guise and go away with it.

[_act_]

It's so bad to hold one's crypto in any decentralized wallet, this is part of the repercussion.

You have a very good post but you make a mistake, I guess you are talking about custodial wallet and centralized exchanges, that we should not save crypto on them, instead we should use noncustodial wallet which is what we are talking about. On decentralized exchanges, you can send coin from your noncustodial wallet and receive the coin you exchange for on noncustodial wallet, they are not the same as centralized exchanges. What we against is that people should not save their coins are centralized exchanges and custodial wallets because you do not have the keys. We can not say a wallet is decentralized, if we have to say that, it means we should refer to those wallets that you run your node like bitcoin core.

[ajiz138]

Wyre users are able to withdraw, but they can only withdraw 90% of their money. Assuming you have $1000 on the exchange, you can not be able to withdraw $100 and Wyre users will be panicking about their money by now. Can you see that the more money they have on Wyre, the more money they can not be able to withdraw. On noncustodial wallet, you can send all your coins on the wallet at anytime.

Previously it was also the same as Juno urging its users to withdraw due to uncertainty whereas they involved Wyre as a partner who could control this.
Source: https://cointelegraph.com/news/crypto-firm-juno-urges-users-to-withdraw-after-uncertainty-with-custody-partner

As for this news and it's true that Wyre is having a problem so users who want to withdraw at 90% limit this will be their panic but I don't know what the problem is but what is clear from the tweet is making an important change in management.

It is clear from the previous case that exchanges are vulnerable to our assets, so don't ever trust them, even though they have been operating for a long time, if our assets on the exchange are not ours.

But still there are always people who believe in the exchange. huh

[mk4]

"We are modifying our withdrawal policy. While customers will continue to be able to withdraw their funds, at this time, we are limiting withdrawals to no more than 90% of the funds currently in each customer account, subject to current daily limits."

Man, I don't want to make quick conclusions, but this really smells like insolvency. You can slightly justify having a set amount of daily withdrawal limits due to regulatory reasons, but having a set percentage? That's just too fishy imo.

[Yogee]

....Man, I don't want to make quick conclusions, but this really smells like insolvency.

Well.... https://www.axios.com/2023/01/03/wyre-shutdown-crypto-winter

Scaling back operations certainly means they are being hit by heavy losses and likely running out of cash. Also reported in that article is the failed deal to purchase the said payment platform for $1.5 Billion last April 2022. Anyone following the news should have expected this move by Wyre to avoid a complete shutdown.

[Merit.s]

I will advice customers to withdraw the 90% funds left in the payment platform, in other for them not to come up with another scam or hack stories,because it is like they are about to crash due to insufficient funds on the platform. Everyday we keep on seeing platforms crashing due to mismanagement and customers using these exchanges or platforms lost at the long run,this is enough lesson for crypto users to know that a noncustodial wallet is your own personal bank and only you can keep your coins safe. Trust no centralized system no matter their level of operation and for how long they have gained customers trust.

[LoyceMobile]

So they're only stealing 10% of your money. They should call it a bail-in, that's what banks would do.

[Kavelj22]

So they're only stealing 10% of your money. They should call it a bail-in, that's what banks would do.

This is a really strange decision, especially since the platform will officially stop working after offering to buy it from the Bolt platform, as most reports indicate. On the other hand, the decision seems somewhat absurd because the procedure applies to the rate of daily withdrawals, meaning that the user can withdraw 90 percent of his savings, then within the next 24 hours withdraw another 90 percent of the remaining amount, and so on until there is nothing left. But the situation will be more complicated if the daily withdrawal rate does not exceed a certain limit, meaning if you have 5 bitcoins and the daily withdrawal limit is 1 bitcoin, you will be able to withdraw the full amount within about a week. This is very suspicious.

[jrrsparkles]

I do not know if Wyre is a custodial wallet or an exchange. I decided to post this on beginners and help for the beginners to learn another lesson which is not new again. But moderator can decide to move it to the appropriate board.

This is not about hack but it is about not you key not your coin. On noncustodial wallet, you are the owner of your coin, unlike on custodial wallets and exchanges that you are not the owner because the keys are not yours.

See the interesting news:
https://cointelegraph.com/news/wyre-imposes-up-to-a-90-withdrawal-limit-for-all-users

Wyre users are able to withdraw, but they can only withdraw 90% of their money. Assuming you have $1000 on the exchange, you can not be able to withdraw $100 and Wyre users will be panicking about their money by now. Can you see that the more money they have on Wyre, the more money they can not be able to withdraw. On noncustodial wallet, you can send all your coins on the wallet at anytime.

Many centralized exchanges including Binance halted withdrawal of particular coin for a while and they mention it as maintenance or something temporary suspension so every exchange face this and probably actual maintenance is going or they are facing some regulatory actions so they put limitations but whenever you're deposited the funds into a centralized exchange or even bank the money is not in your control anymore.

[Coyster]

I do not know if Wyre is a custodial wallet or an exchange.

It is a cryptocurrency payment company

Many centralized exchanges including Binance halted withdrawal of particular coin for a while and they mention it as maintenance or something temporary suspension so every exchange face this and probably actual maintenance is going or they are facing some regulatory actions so they put limitations but whenever you're deposited the funds into a centralized exchange or even bank the money is not in your control anymore.

I don't think they are undergoing maintenance, from all the news i have read about this issue, it is somewhat certain that the collapse didn't just happen, it has been coming, some of their workers had already disclosed that they were preinformed that the company was going to be shut down, and that the CEO had already emailed the workers to inform them about this:

Two unnamed employees told Axios that Wyre is shutting down, with one adding that CEO Ioannis Giannaros emailed part of the staff during the holidays about plans to liquidate the company and terminate services by the end of the month.

Quite a lot of people believe their collapse has something to do with what happened to FTX some couple of months ago, though there is another side to the story that it was as a result of their fall out in partnership with metamask:

Reports suggesting a collapse of Wyre resulted in its breakup of partnership with crypto wallet MetaMask.

One thing is certain, and that's that they can only go on with this withdrawals for as long as they can handle it, very soon withdrawals would stop completely, and by then not too many people would have managed to take their money out.

[EarnOnVictor]

It's so bad to hold one's crypto in any decentralized wallet, this is part of the repercussion.

You have a very good post but you make a mistake, I guess you are talking about custodial wallet and centralized exchanges, that we should not save crypto on them, instead we should use noncustodial wallet which is what we are talking about. On decentralized exchanges, you can send coin from your noncustodial wallet and receive the coin you exchange for on noncustodial wallet, they are not the same as centralized exchanges. What we against is that people should not save their coins are centralized exchanges and custodial wallets because you do not have the keys. We can not say a wallet is decentralized, if we have to say that, it means we should refer to those wallets that you run your node like bitcoin core.

Thanks for pointing out these mistakes. However, I know all of what you have explained, it was a mere typo error on my part yesterday which was corrected immediately after I detected it. You should have known through the meaning of the post itself, and you might want to check it again now.

[dkbit98]

Wyre users are able to withdraw, but they can only withdraw 90% of their money. Assuming you have $1000 on the exchange, you can not be able to withdraw $100 and Wyre users will be panicking about their money by now. Can you see that the more money they have on Wyre, the more money they can not be able to withdraw. On noncustodial wallet, you can send all your coins on the wallet at anytime.

Holding 10% of seized funds doesn't look like much but imagine if you deposited larger amount of money.
I never used Wyre but I see they are being used as fiat-to-crypto gateway, and they had connection with Metamask shitcoin wallet.
For what I see Wyre is registered in United States so I wouldn't be surprised if we see people starting to sue them soon.

[UserU]

For what I see Wyre is registered in United States so I wouldn't be surprised if we see people starting to sue them soon.

There were non-US exchanges that got sued, Bitgrail (Italy) being one of them.

Not gonna be easy for those scumbags to walk off scot-free

[Dunamisx]

I do not know if Wyre is a custodial wallet or an exchange.

It is both and what they do is to trick users that they aren't centralized and this has happened to many people in such manners having same experience from the exchange they uses, but i thought peop would have learnt their lessons by avoiding them to remain secured with a decentralized one tht can present them their keys in a non custodial pattern perfectly, there's no lie or manipulations about it if it's not decentralized then it's fully centralized, i only pity the newbies that have not key to learning about knowing the differences.

 

[nakamura12]

I do not know if Wyre is a custodial wallet or an exchange.

It is both and what they do is to trick users that they aren't centralized and this has happened to many people in such manners having same experience from the exchange they uses, but i thought peop would have learnt their lessons by avoiding them to remain secured with a decentralized one tht can present them their keys in a non custodial pattern perfectly, there's no lie or manipulations about it if it's not decentralized then it's fully centralized, i only pity the newbies that have not key to learning about knowing the differences.

 

I cam say the same that it is both since people can buy, sell and exchange as what they have claimed but I don't trust them if I were to use an exchange or a wallet. If I am one of the people who use it then I would be worried about the platform when they announced that they are modifying the withdrawal policy which in my opinion is kind of a negative review for me. 10% is indeed quite a lot if someone deposit huge amount and they can keep 10% and add all the 10% money from every customer they have then that would be a lot.

[Crypt0Gore]

Crypto wallets like Wyre are custodial, I doubt they give users access to their private keys or recovery seed, on such wallet you will only need your Gmail and a password to log into the wallet, KYC information is also required as per my research lol, this is a big red flag, I hope people learn and understand the importance of non custodial wallet.

[Sanitough]

Wyre users are able to withdraw, but they can only withdraw 90% of their money. Assuming you have $1000 on the exchange, you can not be able to withdraw $100 and Wyre users will be panicking about their money by now. Can you see that the more money they have on Wyre, the more money they can not be able to withdraw. On noncustodial wallet, you can send all your coins on the wallet at anytime.

Holding 10% of seized funds doesn't look like much but imagine if you deposited larger amount of money.
I never used Wyre but I see they are being used as fiat-to-crypto gateway, and they had connection with Metamask shitcoin wallet.
For what I see Wyre is registered in United States so I wouldn't be surprised if we see people starting to sue them soon.

Just imagine how much Wyre can earn from these seized funds from all of its users, so this should be alarming for all Wyre users as they are slowly stealing our funds, and this 10% will eventually grow more in the months to come. Although 10% is not that big if we only put minimal amount, but it would be a very huge amount of loss already if you are a huge amount depositor. So stay away from it if you have plans putting your funds into Wyre.

[KingsDen]

All these are not big problems only if you understand what you are doing and also understand what an exchange is;

An exchange is not a charity organisation ;
An exchange is not your private wallet;
An exchange as the name implies is used to exchange your coin and move it back to where it is supposed to be;
An exchange is a business of someone who is strategizing to own your coins forever.

Use the exchange according to what they are. Do not trust them more than they deserve and  do not blame them when they do what they like with your coins.

[Vaculin]

"We are modifying our withdrawal policy. While customers will continue to be able to withdraw their funds, at this time, we are limiting withdrawals to no more than 90% of the funds currently in each customer account, subject to current daily limits."

Man, I don't want to make quick conclusions, but this really smells like insolvency. You can slightly justify having a set amount of daily withdrawal limits due to regulatory reasons, but having a set percentage? That's just too fishy imo.

There is really something wrong with how this exchange set its own rule on withrawal. Then what about the remaining 10% of the users funds, surely they will automatically become the exchange’s possession. I don’t know if no one plans to sue this exchange but I think if the withrawal rate will not change, Wyre users will end up suing them as its obviously stealing their own funds.