A Problem of Scale as New Traders Kept Out of Bitcoin Market

Customers are knocking, but it seems several bitcoin exchanges are shunning the
hordes of new traders wanting to make their first foray into the digital world. While
many businesses can only dream of having too many clients – and few would even
admit there is such a thing – bitcoin exchanges are finding it hard to scale up to the
increased traffic load coming their way, leaving many would-be- investors anxious
that they are missing out.
Ironically, as media coverage increases and as an increasing number of new
investors are looking to cash in on bitcoin, there are fewer places for them to invest
their money as exchanges take time out to upgrade their systems to better service
their existing client base.

Bittrex, the world’s third-largest cryptocurrency exchange, has the digital equivalent
of a “Gone Fishing” sign up on its sight telling potential new clients trying to register
for its services, “The reason we have decided to temporarily stop accepting new
accounts is that we cannot undermine the quality of our services for our existing
traders by flooding the system with new, small accounts,” reports bitcoin.com.
That service is coming into question by some users who are become increasingly
vocal about the fact they are unable to withdraw their money – with delays of up to a
month in some cases.
According to E-Money Chat, Bittrex said the delay was caused by the high number of
users and its verification process. The Las Vegas-based exchange said that it has
hired additional staff to reduce the current lag time in fulfilling its clients’ requests.
Bittrex is not alone. London-based CEX.IO has also temporarily suspended the
registration of new users, citing the “enormous number of users” who register on the
exchange each day, which has led to additional pressure on its support and
verification teams. To counter this pressure, CEX.IO, like Bittrex, is increasing its
support team and working to deal with the backlog of tickets submitted by clients,
which it says has reached a “critical” number.
While it is unlikely the current “blip” will be enough to dissuade new traders from
investing – when they are finally able – it does raise questions about how exchanges
must handle their business going forward to ensure consumer confidence is not
shaken.
As for those people on the outside looking in? All they can do is wait and see.