BitMart reversed its plan to fully shut down, announcing Friday it is building a restructuring plan that could include a phased restart of operations. This development came five days before the August 26 deadline set to halt all trading on the platform. The new strategy involves distributions to creditors.
The presence of creditor distributions signals balance sheet problems, a distinction from exchanges that pause operations due to market conditions. BitMart has retained White & Case as restructuring counsel, one of the largest insolvency practices globally. Companies engage such specialized legal assistance when addressing significant financial obligations, not during a market recovery.
The exchange's initial exit plan, published July 26, cited operating conditions, the market and future strategy as reasons for closure. That notice made no mention of missing money or financial distress. New sign-ups, deposits and new orders ceased the same morning. The platform was scheduled to go dark on January 31, 2027.
Traders reacted to the July 26 shutdown notice by crashing BitMart Token (BMX) 46 percent overnight to about $0.11. Following Friday's reversal announcement, BMX now trades near $0.0626, up 6 percent on the day.
The July shutdown announcements from BitMart and other venues initially drew an upbeat response from some analysts, who interpreted them as the market clearing out weaker platforms. Moonrock Capital founder Simon Dedic argued the operational model behind many exchanges had run its course. Crypto Banter chief executive Ran Neuner said market bottoms often form when only the fittest entities survive.
Both assessments assumed these exchange exits were final. Friday's update from BitMart directly contradicts that assumption, as one of the exchanges analysts pointed to as a sign of a market bottom is now actively working to resume trading.
BitMEX, another derivatives venue, announced its closure three days apart from BitMart, using nearly identical language about strategic reviews. However, BitMEX has not reversed its decision and still plans to close on September 23, ending an 11-year operational run. BitMEX has already returned staked BMEX balances to users. Accounts with remaining funds on BitMEX now incur a monthly charge, pushing users to withdraw.
Despite BitMart's July notice promising continuous withdrawal services, many users reported blocked withdrawals. Ethereum withdrawals spiked to a 2026 high as individuals attempted to move funds from the platform. By mid-August, reports surfaced from former staff claiming unpaid wages.
BitMart founder Sheldon Xia denied withdrawal blocking claims, calling them fabricated and threatened a police report. Xia did not provide reserve figures or a specific repayment date. Investigator ZachXBT publicly urged Xia to return user funds instead of issuing statements.
BitMart has a history of security incidents. Hackers drained approximately $196 million from two of the exchange's hot wallets in December 2021. Security firm Peckshield initially flagged that breach, and BitMart pledged to replenish affected user funds.
As of now, no formal bankruptcy or restructuring filing from BitMart has been publicly disclosed. The exchange is developing its plan with the August 26 trading halt deadline approaching.
