McxNOW Cryptoexchange Suspends Trading Following Support Request Overload
The McxNOW cryptoexchange has suddenly suspended trading due to overwhelming user growth and support requirements.
Digital currency exchange mcxNOW has announced it will suspend trading for the next few months, due to overwhelming support requests.
McxNOW is an exchange that offers interest on balances held by its users. Users now have until 20th December to withdraw coins before the exchange closes for upgrades to its backend and support systems.
The company operates a non-fiat cyrptoexchange, which offers trades between bitcoin, litecoin, primecoin, feathercoin and other altcoins.
It was developed by a single person, going by the online moniker 'RealSolid'. Little is known for certain about the individual, and he declined to give his name when we spoke to him. He did confirm, however, that he is based in Australia.
The exchange's website states that 25% of all transaction fees received by the site are used to pay interest to its users. According to RealSolid: "Over 200 BTC has been distributed back to users in the form of interest payments."
Taking the idea of fee shares to another level was mcxNOW's "mxcFEE shares". Buying an mcxFEE share entitled the holder to 0.001% of all transaction shares across all the currencies on the exchange. McxFEEs are also tradable, and so their value (against bitcoin) fluctuates as with any other currency.
According to RealSolid, the exchange has "scaled well from 100 users up to a peak of about 3,500 users online at once, it shows the design here is pretty good".
However, he went on to say he had not given enough thought to some aspects of running an exchange that are quite important, such as support. "I need to work on this before allowing the site to grow," he added.
The suspension of trading was announced yesterday on the exchange's front page. Part of the statement reads:
"Unfortunately the growth has been too fast to match with the support requirement as only one person can currently do all support.
This is a burden of 200 to 400 emails a day among many requests on IRC and through chat. This makes development of mcxNOW nearly impossible without neglecting valid user requests through support."
RealSolid explained that the problem with the current version of mcxNOW is that the system doesn't allow for support staff to have anything but complete access to every part of the system, which would clearly be inappropriate.
He stated: "V2 of the site, which is what we are on now, has a very limited admin interface. Basically, if you can do any support, you have control of the whole system.
"So instead of risking the equivalent of $20m of people's funds by letting people do support that way, I need to code a better system. If I [had] hired someone it could have helped, but they'd have the keys to everything. It's too much."
At the end of October, a large amount of mcxFEE shares were sold by RealSolid to mcxNOW users. We asked RealSolid if he had any idea trading would have to be suspended when the mcxFEE shares were offered for sale and he said he did not.
Disgruntled users have said the sudden announcement of the trading suspension has caused people to lose money invested in mcxFEE shares, which reportedly dropped from 0.25 BTC to as little as 0.05 BTC. At the time of writing a mcxFEE share is worth 0.073 BTC.
RealSolid said he never made any kind of agreement on the length of time mcxNOW.com would operate for, so he feels he would be well within his rights to close it down if he wanted to. However, he said: "I don't want to disappoint the users which is why I am making v3."
Some forum members are suggesting that mcxNOW was never anything but a scam, with user twentyseventy stating: "Few things have screamed 'Scam Waiting to Happen' to me more than MCX did. Hate to say it, but this was a surprise to very few."
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.