Brazilian crypto exchange facing numerous lawsuits

Some Brazilian cryptocurrency holders are extremely frustrated. They apparently haven’t been able to withdraw their funds from Bitcoin Bank Group (GBB, for its Portuguese acronym), a crypto investments firm that operates the NegocieCoins exchange out of Paraná. The frustration has boiled over, forcing them to seek legal action and several lawsuits have now been filed against the company.

The issue seems to be fairly widespread, according to a report compiled by Cointelegraph Brazil. The issue has been going on since May and lawsuits have been filed in Sao Paulo, Ceara, Rio Grande do Norte, Sergipe, Santa Catarina, Rio de Janeiro and others.

Despite the vast number of complaints, the exchange doesn’t appear to be providing accurate data. According to CoinMarketCap, its trading volume is currently $1.308 billion. All of the alleged trading has been in SwegWitCoin (BTC), but CoinMarketCap cautions, “We have received reports that user deposits and withdrawals are impeded. Please be careful with your funds.”

The billion-dollar holdings don’t add up. According to data available from WalletExplore, the holdings in the GBB wallets aren’t enough to cover the volume reported by NegocieCoins. This only further raises concerns about the company’s liquidity and stability.

The issue has become so severe that some users have had to resort to selling their holdings through alternative methods at as much as a 90% discount, while others don’t believe they’ll ever be able to complete their withdrawals. One user told Cointelegraph that he had received a letter to remove his funds “within 30 days” because he was no longer welcome on the platform. If he didn’t, he would lose access to the holdings; however, an attempt to remove them was unsuccessful.

GBB has stepped forward to try to defend itself, resorting to the same rhetoric heard way too often. It says, “The company has never denied service to its users, always prioritizing the good relationship. Despite the attacks launched against the platform, the team has excelled in service and conflict resolution [and] to promote a solution to all the situations raised by those who entrust their investments to it.”

However, it also showed its true colors when it added, “In addition, the GBB is already acting strongly to resolve the matter, and will take no steps to correct any misunderstanding that may have been experienced by the client.”