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Blockchain, cryptocurrencies, and insider stories by TNW.

He says it happened long ago, when Bitcoin was dirt cheap

The founder of a Zimbabwean cryptocurrency exchange has apparently lost the password to his companys wallet, preventing users from withdrawing their funds.

Tawanda Kembo, founder and CEO of Golix, is said to be claiming he lost the password for a coldwallet in May last year. According to a report from local newsoutlet Iharare, thewallet contained 33Bitcoin about $300,000 at todays exchange rate.

Loss of the password has reportedly been confirmed by two sources that previously worked at Golix.

Whats more suspicious is the timing of the indiscretion.

The password was allegedly lost during a time when customers were trying to remove their funds from the exchange after the Reserve Bank of Zimbabwe (RBZ) ordered Golix to shut down operations. Customers began withdrawing their cryptocurrency after theRBZ banned Bitcoin tradinglast year.

According to another source that worked at Golix, users that kept their funds on the exchange have not been refunded.

Whats more, Golix is reportedly not communicating with its customers, itsTwitter accounthasnt been updated since February.

However, following Iharares report, Kembo has spoken out to give his account of events.

In a guest post on Iharare, Kembo says that his company has never been unable to process a withdrawal because of insolvency. He said the claims customers have been unable to withdraw funds come from a 1 percent minority.

Kembo admits the company is not profitable right now, but that the company is stable and will be for at least a couple of years.

He then goes on to contradict himself and say that it is true that customers havent been able to withdraw fiat over the last year. He claims this is because cryptocurrency companies cant access bank accounts in Zimbabwe.

This is in part true. The Reserve Bank of Zimbabwe has kept eyes on Golix for a number of years because it believed the exchange represented a risk for the country and it hasfought continually to have it shut down. Which may explain why it cant access bank accounts.

Kembo also claims that Golix mostly never had any challenges processing cryptocurrency withdrawals.According to him, issues arose because customers didnt know how to usecryptocurrency. Theres no mention if Golix ever provided customer support on these occasions, though.

In regard to the lost password, Kembo doesnt deny this, but claims the situation has been taken out of context and doesnt affect Golix.

The Golix CEO says he was an early adopter of Bitcoin and the password he lost was connected to an account accessible only through a Linux terminal. He said the Bitcoin on the wallet was bought dirt cheap, as such, the actual value of the loss is not that large. Its when the value is calculated against todays exchange rate that the loss seems striking.

Kembos version of events suggest that this happened before Golix existed. The story doesnt appear to corroborate with Iharares initial sources of losing the wallet in May 2018.

Given Kembos response, its unclear what exactly is going on at Golix. But considering its inability to process withdrawals and its continued battles with RBZ, Id tread with extreme caution.