BitBrainers: BitMart Reverses Its Own Shutdown Weeks After Announcing It

Empty trading floor - BitMart exchange restructuring August 2026

An empty trading floor. Monitors still glow, but the desks are cleared.

By BitBrainers Editorial

BitMart announced a full wind-down on July 26. Trading was scheduled to halt on August 26 at 01:00 UTC. Platform operations were set to cease on January 31, 2027 at 15:59 UTC. Now, less than a month later, the exchange has hired White & Case as restructuring counsel and is exploring a phased restart with creditor payouts. A detailed roadmap is due by September 9.

The Timeline That Matters

On July 26, BitMart told users it was closing for good. New registrations and deposits stopped immediately. Futures trading entered reduce-only mode. Spot markets stopped accepting new orders. The company cited operating conditions, market environment, and future strategic direction. It did not mention creditors. It did not mention restructuring. It did not mention White & Case.

The shutdown plan had hard deadlines. All trading would end on August 26 at 01:00 UTC. The platform would shut down entirely on January 31, 2027 at 15:59 UTC. Users were told to close positions and withdraw before August 26.

Then, on August 21, the story changed. BitMart announced it was developing a restructuring plan that could include a phased restart of operations alongside distributions to creditors. The exchange hired White & Case, a top-tier international law firm, to advise on the restructuring. A roadmap is expected by September 9.

What Changed

The reversal landed five days before the trading halt deadline. That is not how an orderly wind-down works. An exchange that is fully solvent does not need to talk about creditor distributions. The language in the August 21 update is the tell. Something changed between July 26 and August 21, and it was not the market environment.

Users started reporting withdrawal difficulties almost immediately. Lookonchain data showed only 58 wallets withdrew roughly $805,000 in the first 24 hours after the July 26 announcement. An eight-hour stretch recorded zero withdrawals processed. Multiple market makers and projects reported stuck or unprocessed withdrawals. Scandic Coin reported specific balances unprocessed after submission on July 26.

OpenGradient co-founder Matthew Wang publicly stated his market-making team's funds were stuck and alleged the exchange was functionally insolvent. He also flagged that BitMart had pushed a locked savings campaign offering up to 15% APY roughly one week before the wind-down notice. The frozen-funds portion is corroborated by at least one other project. The insolvency characterization itself remains an allegation.

Former CEO Nenter Chow took the role in April 2025. He said he was removed on July 24, two days before the shutdown announcement. He learned of the closure when the public did. Chief Product Officer Terence Li resigned on August 13. An orderly wind-down has a transition plan. It has a communication strategy. The CEO is not removed two days before the announcement and left to find out on Twitter.

The Open Letter

On August 17, the BitMart Chinese-language account posted an open letter demanding founder Sheldon Xia and Yi Li disclose wallets, assets, liabilities, and usable reserves by August 19. It demanded a concrete repayment plan for frozen user funds and unpaid staff wages. Failure to respond would result in evidence submission to regulators and law enforcement worldwide.

Xia dismissed the letter as fabricated rumors from a hacked account. He threatened a police report. He never addressed the substance. Xia also responded to unpaid staff claims by stating employees are not prioritized over client assets, and that everyone is a client with no privileges. Onchain investigator ZachXBT challenged him directly: "If you actually have the liquidity, then simply return the funds to everyone instead of posting vague statements?" No public disclosure by Xia has surfaced as of this writing.

The Wallets

Arkham-tracked wallets linked to BitMart held roughly $102 million on July 6, dropping to roughly $71 million by July 26 and roughly $36.5 million by mid-August. CoinMarketCap disclosed reserves at roughly $4.6 million, heavily weighted toward BitMart's own BMX token. No formal bankruptcy or insolvency filing exists.

Distressed-debt firm Echo Base offered a funded restructuring package including DIP financing and equity. BitMart did not respond. Echo Base CEO Roshan Dharia said there is no version of this that ends well without going to court.

The Context

This reversal happened during a Bitcoin rally. BTC surged from $62K to nearly $80K in a matter of days, driven by a Treasury buyback expansion and over $1 billion in short liquidations. ETF inflows on August 19 hit $517 million, the largest single day since May 4. Eight of twelve ETFs saw inflows. BlackRock's IBIT captured $284.7 million. The category was waking up.

BitMart is not the only exchange shutting down. BitMEX announced its own closure on July 23, set for September 23. The exchange that invented the 100x perpetual swap is ending after eleven years. BitMart's reversal suggests someone looked at the market, looked at the balance sheet, and decided a wind-down was premature. The balance sheet may have told them a wind-down would expose problems that a restructuring could hide.

What This Means for Users

If you have assets on BitMart, the deadlines have not changed. Trading still halts on August 26. The restructuring is a proposal, not a guarantee. White & Case is advising. The exchange has not committed to restarting. The roadmap due September 9 will clarify whether this is a real restart or a slower form of the same wind-down.

After watching these exchange cycles for years, I have learned that restructuring announcements during a bull market often serve two purposes. They buy time for the operator to assess whether the business is salvageable, and they keep users from panic-withdrawing while the books are reviewed. The creditor distribution language is the tell. An exchange that is fully solvent does not need to talk about creditor payouts.

BitMart has been here before. Hackers stole roughly $196 million from two hot wallets in December 2021. The exchange pledged to reimburse users. That history is relevant because it shows the platform has operated under stress before, and because it raises the question of whether reserves were ever fully restored.

Fake BitMart support accounts are actively DMing users on Telegram, WhatsApp, and LINE offering to help with stuck withdrawals or priority processing. BitMart has explicitly stated there are no paid priority withdrawal services. Anyone offering one is attempting fraud.

Also Watching

USDC circulating supply dropped $1.5 billion over 30 days, with $1 billion leaving in a single week. Circle posted $701 million in Q2 revenue while its product shrank. They are running a money market fund that pays depositors zero yield while earning on Treasuries. The $1B weekly redemption suggests a large player exited.

President Trump, when asked about bond market intervention on August 21, said: "We have many types of intervention. That's one," adding: "The ultimate intervention is our military. And if we have to use that, we will." This came as the 30-year Treasury yield stabilized around 5.18% after the Treasury announced doubled buybacks.

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