Investors Are Getting Nervous As Crypto Exchange Kraken Goes Dark

More than 48 Hours After Kraken Went Dark, Users Getting Nervous

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Kraken, one of the biggest crypto exchange, went offline at 9pm Pacific Time on Wednesday after the site initiated a system upgrade that was initially scheduled to last two hours as stated by the Kraken engineers, plus an additional 2 to 3 hours for withdrawals, according to an announcement placed by the San Francisco-based company on their website. Much like Gilligan’s three-hour cruise that went horribly wrong, Kraken users all over the Internet are raging over the downtime and asking difficult questions.

On December 15, Kraken announced a major upgrade to fix the site’s usability problems:

“ performance is extremely degraded and unreliable.  Clients can expect severe latency and difficulty interacting with all web and API services.  Requests will frequently timeout and fail.  At the moment, the only solution is to wait and try again later.

Next week we will be rolling out a major systems upgrade which should resolve these scaling and load issues.  The upgrade is long overdue and has been substantially delayed by the diversion of resources toward the protracted firefighting effort required to deal with the last several months of unrelenting growth.”

About one day after the two-hour upgrade began, Kraken posted:

“We are making progress on the few remaining issues but don’t have a definite launch time yet. We intend to cancel stale (and possibly all) orders and pause liquidations upon resuming service. More details to follow soon. Thank you for your patience.”

The status update on Kraken’s website posted several hours ago reads:

“We are still working to resolve the issues that we have identified and our team is working around the clock to ensure a smooth upgrade. This means it may still take several hours before we can relaunch the site.”

In its previous updates, Kraken mentioned it’s working on “unexpected and delicate issues” and assured clients their funds were secure, adding that “Yes, this is our new record for downtime since we launched in 2013. No, we’re not proud of it.”

Cryptocurrencies trading has been rife with hackers and stolen bitcoin, so any issue with crypto exchange are quick to frighten investors. In the most famous case, Mt. Gox filed for bankruptcy in 2014 after losing hundreds of thousands of its clients’ bitcoins.

As the interest in cryptocurrencies has grown exponentially, nearly all digital currency exchanges have faced significant growing pains in the last year. Crypto exchange like Coinbase and Bitstamp have been overwhelmed with user traffic, leading to delays. Bitfinex has been hit by DDOS attacks and recently had to stop registration for new users because of overwhelming demand. Binance and Bittrex have also halted new user signups.

Still, Kraken has arguably suffered the most problems of all major exchanges. Users have experienced multiple connection errors and extraordinary difficulties placing and cancelling orders. It’s sometimes necessary to refresh Kraken’s page 10-15 times before being able to execute an action. Numerous users have complained that Kraken posted their orders multiple times (after telling them their order failed initially), in some cases costing them thousands of dollars.

Kraken is one of the exchanges that the CME Group Inc. is using to price the bitcoin futures it introduced last month.

Lack of communication from fledgling companies, delays in withdrawals and transfers, high fees, and the creeping fear of a malicious attack are some of the issues largely retail investors face, and discourage many more from jumping in.

Most astonishing of all, about 36 hours after the upgrade began, Kraken apparently sent their engineers home to take a nap! Kraken crypto exchange writes:

“We are close but rather than launch immediately ahead of the team passing out, we will push off a bit to get some rest and be able to better monitor systems and react to problems following launch. Unfortunately, this means several more hours of delay.”

At press time, Kraken is still down with no ETA for resumption of trading, and the exchange has not responded to our requests for comment.

With not even a phone number or e-mail listed on Kraken’s status page, the Kraken’s clients vented on Twitter.

A Twitter user with the name of Victor M. said “im seriously considering suing kraken. anyone interested as well?” The Tweet got more than 300 likes.

A user with the name North Canton Cab Com tweeted to Kraken saying “due to the length of down time can you at least assure us that our coins and accounts are safe and haven’t been hacked or stolen please, seems beyond any normal circumstance at this point when people are worried sick!”

Others are resorting to humor, with Twitter user @Subbedeius posting “Kraken is the best platform to avoid panic-selling. It just doesn’t work when sh*t hits the fan.”

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