Poloniex to Reach Regulators before Clearing White Hat ETC Withdrawals – The Basics about Cryptocurrency

Poloniex, one of the leading digital currency exchanges, is waiting for clearance from law enforcement agencies before it can release millions of dollars’ worth of Ethereum Classic (ETC) tokens. The exchange made an announcement about the recent developments on Twitter earlier today.

Earlier this month, Poloniex, along with Kraken, received over $10 million worth of ETCs from the so-called White Hat DAO group. The group had sent ETC recovered from the stolen DAOs to these platforms with an intention of converting them to ETH. But sensing foul play, both Kraken and Poloniex had frozen these deposits.

READ MORE : Ethereum Developers Attempt to Dump Over 7 Mil ETCs into Exchanges

Close to a month after the incident, Poloniex is now ready to allow the parties to withdraw their ETCs from the platform. But given the implications of such an action, the exchange has got in touch with the relevant law enforcement authorities. The authorities, who probably are already involved in the investigation of White Hat DAO team, will have to give a go-ahead for Poloniex to distribute the ETCs to its rightful owners.

Once Poloniex releases the frozen ETCs, the market will be flooded with over 4.1 million ETCs. A sudden surge in supply may have an adverse effect on the ETC price. The distribution of ETC to its rightful owners is expected to be executed by Bity SA, a Swiss company consulting for the White Hat DAO group.

According to reports, over 44 percent of ETCs recovered by/belonging to White Hat DAO Group is distributed between both the exchanges. The recent developments indicate Poloniex’s readiness to release the ETCs in its possession. However, it is unclear how Bity or the White Hat DAO team intends to distribute them back to its rightful owners.

There are speculations of ETC price taking a hit once the new stash of tokens is dumped into the market. The effects of dumping on ETC price will definitely serve as an indicator of the maturity of the digital currency.

Ref: Twitter | Image: Imgur