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Since rumors spread on Twitter about halting withdrawals from the exchange, traders have been selling the KCS token en masse

The price of KuCoin (KCS), a native token of the KuCoin cryptocurrency exchange, has fallen over the past seven days following insolvency rumours. At the time of writing, KuCoin has lost 17.34% over the past week and was trading at $8.75, according to coingecko.

KuCoin is the fifth largest cryptocurrency exchange in the world, with a trading volume of $928 million in 24 hours. Its KCS token is the number 49 digital asset on Coingecko, with a market capitalization of $858 million.

But earlier this week, rumors started spreading on Twitter that KuCoin was going to stop withdrawals because it was on the verge of bankruptcy. KuCoin CEO Johnny Lyu responded by saying that the company has no exposure to LUNA, 3AC or Babel.

No ‘tremendous suffering’ from any ‘coin collapse’, no plan to stop withdrawal, everything on KuCoin works fine“, said Lyu on Twitter, adding that “KuCoin reserves the right to take legal action” against those who spread false rumors.

Lyu was referring to three recent collapses in the cryptocurrency ecosystem: Luna, the governance token of the Terra ecosystem, which saw tens of billions of dollars of value wiped out last month in the spectacular crash of the Terra ecosystem; 3AC or Three Arrows Capital, a hedge fund that filed for bankruptcy last week; and crypto lending platform Babel Finance, which suspended redemptions and withdrawals last month.

All three are examples of a liquidity problem in the crypto ecosystem right now, as digital assets plunged in price during the bear market.

Lyu also responded directly to someone who asked if KuCoin had exposure to Celsius, which is said to be near bankruptcy, and said: “Boop.”

Amid the crypto crash that accelerated in the first week of May, what started as rumors on Twitter have mostly proven to be accurate, including rumors about the solvency of Celsius, Three Arrows Capital , BlockFi and Celsius. Lyu insists that her scholarship is doing very well: “We are one of the few platforms still hiring“, he said, adding that KuCoin was “more active in the bear market” and launched new features.



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