BitMart Founder Fights Back Against Exit Scam Accusations

BitMart founder Sheldon Xia pushed back on exit-scam allegations on August 8, saying the crypto exchange has not and will not run away. In a Chinese-language post on X, Xia said the team is still working through asset inventory, consolidation, and system maintenance. The statement landed on the same day BitMart had set as the deadline for US-based customers to withdraw their crypto. Xia provided no figures, set no new timeline, and pointed to no reserve report.

BitMart announced on July 26 that it would begin an 'orderly wind-down' of its trading platform operations, citing operating conditions and strategic direction. New account creation, deposits, and fresh orders were halted that day. Spot and futures trading are scheduled to stop on August 26, with full platform operations ending by January 31, 2027. The announcement sent the exchange's native BMX token down 58% in 24 hours, according to widely reported market data.

Even before the formal shutdown, users had flooded social media with reports of frozen or badly delayed withdrawals. One account holder told Cryptopolitan they still had $80,000 in crypto trapped on the platform, estimating that 150,000 users were searching for their money through a BitMart Telegram channel.

Leadership and Regulatory Questions

The wind-down followed internal leadership upheaval. Global CEO Nenter 'Nathan' Chow, who joined BitMart from Animoca Ventures and took the role in April 2025, was let go. Chow said he learned about the end of his employment on July 24 and played no part in the wind-down decision. Days before the shutdown, Chow had publicly pledged the company would 'be here for the next eight' years.

BitMart's holding company, GBM Global Holding Company Limited, is registered in the Cayman Islands, and its user agreement invokes Cayman law. But the Cayman Islands Monetary Authority confirmed on August 6 that BitMart and its GBM entities are not and have never been registered, licensed, regulated, or otherwise authorized to operate a virtual-asset business there.

The company also carries past baggage. BitMart suffered a $150 million hot-wallet hack in December 2021, according to its own figure, while blockchain security firm PeckShield estimated the losses at nearly $196 million. In a May 23 statement addressing earlier withdrawal complaints, the exchange blamed its risk system, saying it had flagged 239 linked accounts accused of abusing trading subsidies. A full proof-of-reserves report, promised at the time, has still not been published.

With the founder asking for trust, the regulator saying it was never involved, and a proof-of-reserves report still overdue, the key question is whether Xia can deliver verifiable asset disclosures before the August 26 trading halt. That will determine whether this wind-down stays orderly.