BitMart founder Sheldon Lee has refused calls for an independent audit of the exchange’s finances. He labeled allegations of frozen withdrawals and unpaid staff “fabricated rumors” stemming from a compromised social media account. The platform is winding down. Its final day is Aug. 26.
The fight broke into public view after BitMart’s Chinese-language X account posted that users still cannot pull their funds and that some employees have gone without July salaries or owed compensation. The post demanded that Lee and business partner Yi Li open the exchange’s wallets, assets, liabilities, and usable reserves to third-party verification. It gave Lee until Aug. 19 to respond, per CoinDesk.
Lee’s answer: the account was hacked. “We have collected full evidence of the content on X, all of which is fabricated rumors,” he wrote on X. “During daytime US time, we will file a police report and send a lawyer’s letter to X, demanding technical and data forensics.” He did not address the audit demands.
Cointelegraph’s Asia Express roundup corroborated both the post and its claims. It described the Chinese-language account publicly pressing Lee, whom Cointelegraph calls Sheldon Xia, on the whereabouts of user funds. Whether the account was hijacked or run by an insider is still an open question. The roundup’s subhead read “BitMart’s internal feud erupts into the spotlight ahead of its closure,” though the body text did not independently confirm a closure beyond what BitMart had already announced.
BitMart announced the wind-down on July 26. Aug. 26 is the last trading day. The exchange’s BMX token dropped 58% on the news, per CoinDesk. The platform had been running for nine years.
On unpaid staff, Lee neither confirmed nor denied. Employee assets “are not prioritized over client assets, everyone is a client, and there are no privileges,” he wrote.
Users say withdrawals are still stuck. One X user, BeardStaff, wrote that their assets have been locked since the July 26 announcement and that a dedicated VIP manager removed them from Telegram the same day withdrawals stalled. “Where is my $10 million?” the user posted. Another, @chicha_liam, wrote: “No one asked you if the account was hacked or not. Answer what people have been asking you since July 26. When will users be able to withdraw their funds?”
Onchain investigator ZachXBT challenged Lee’s framing directly. “If you actually have the liquidity, then simply return the funds to everyone instead of posting vague statements,” he wrote.
A restructuring proposal sits on the table. Roshan Dharia, CEO of distressed investment firm Echo Base, told CoinDesk via Telegram that his firm offered a funded restructuring package. It includes debtor-in-possession financing and equity at emergence, underwritten by Echo Base as a claimholder. BitMart has not responded.
Dharia did not soften the outlook. “A custodial book this size can’t be resolved consensually, because you can’t reliably reach such a dispersed retail customer base, and every user you miss keeps a claim in full,” he said. “There is no version of this that ends well without going to court. The only question for the board is whether BitMart walks in with a plan and a funded sponsor, or is taken there by its own claimants.”
Neither source names the total number of affected users or the full amount of locked funds. Only BeardStaff’s $10 million claim is on the record. Law enforcement or regulatory involvement is unconfirmed. Lee promised a police report over the alleged hack. The audit deadline stands. What happens if it passes unanswered is the next thing to watch.
Holders, as ever, are divided.
