The CEO of a troubled Zimbabwean cryptocurrency exchange has denied that the exchange is pulling an exit scam after being closed for almost three months. According to iHarare, the Golix exchange has closed its operations having been offline since February and following weeks of complaints from customers that they were unable to withdraw their funds, but CEO Tawanda Kembo has denied suggestions that the company is in trouble, blaming the coronavirus for impacting development.
Golix’s Legal Troubles
Golix, which opened in late 2014, is the country’s oldest exchange, but it seems that after three fairly straightforward years of operating the service things have turned sour. In May 2018 the Reserve Bank of Zimbabwe (RBZ) banned all cryptocurrency trading in the country, which naturally acted as a hammer blow to Golix and resulted in the exchange being ordered to shut down by financial regulators.
Golix took RBZ to court and were granted a temporary reprieve, but withdrew their challenge before the case could be heard. The RBZ in turn filed their own suit against Golix in the high court, demanding compensation over the costs involved in Golix’s actions.
From Bad to Worse for Golix
From there, things seem to have spiraled. According to iHarare, Golix customers began experiencing delays in withdrawals and then a complete inability to withdraw their funds, something that always acts as a red flag when it comes to the potential for an exit scam. Golix CEO Tawanda Kembo has been quick to deny this, claiming that 99% of withdrawals have gone through and a “very tiny vocal 1%” are making the complaints.
To make matters worse, late last year reports emerged that Kembo had lost the password to a Bitcoin cold storage wallet containing ₿33, although Kembo claimed this was in the very early days of Bitcoin, before he launched the exchange. According to iHarare, the Golix website has been down since February, which Kembo claims is due to “maintenance”.
This doesn’t explain however why the company’s social media channels have all been silent for at least a year, with no updates on any potential delays of downtime.
Kembo Blames Lockdown
In an interview with iHarare, Kembo claimed the coronavirus lockdown has impacted the company, with some staff having to be let go and others working remotely. This has apparently impacted the redevelopment of the site, but with clients still unable to access their funds and no announcements on social media regarding any site issues, things are not looking good for Zimbabwe’s oldest crypto exchange, or more importantly, their customers.