BitMart CPO resigns as insolvency speculation grows

The resignation of BitMart Chief Product Officer Terence Lee has intensified online speculation that the soon-to-be-shuttered crypto exchange may be insolvent.

Founded in 2017, BitMart grew to rank among the top 30 crypto exchanges by trading volume at its peak, making its wind-down one of the more notable mid-tier exchange closures in recent years. The situation has drawn comparisons to previous exchange failures where executive departures and withdrawal delays preceded revelations of missing funds.

In a statement posted online, Lee said he was not “responsible for the exchange’s core business” and that he was not involved in BitMart’s “operations, management, or asset-related matters of the company or any of its affiliated entities.”

He also said he had “no authority over platform assets, accounts, or matters relating to user funds” and stated that he would not comment on any legal proceedings, describing his resignation as “my sole public clarification on this matter.”

Crypto streamer Travladd said Lee’s departure “screams insolvency” and claimed he was resigning “before shit hits the fan.”

BitMart situation has ‘gotten out of hand’

According to “Cao,” a lawyer who has previously served BitMart demand papers, the “situation has gotten out of hand.”

They said that “Not being in control of assets doesn’t exempt a co-founder from responsibility; you don’t get to opt out of accountability by stepping back once things collapse.”

I don’t usually air personal work here, but the @BitMartExchange situation has gotten out of hand, and my clients are victims of a chaotic and poorly managed cessation of operations. We’ve served formal demand letters across multiple jurisdictions and tried to reach the… — Cao (@CaoLinSan) August 12, 2026

I don’t usually air personal work here, but the @BitMartExchange situation has gotten out of hand, and my clients are victims of a chaotic and poorly managed cessation of operations. We’ve served formal demand letters across multiple jurisdictions and tried to reach the…

BitMart’s withdrawal issues

Before Lee’s departure, Open Gradient CEO Matthew Wang had already accused BitMart of insolvency after his market maker could not retrieve its funds.

He also said it was “insane” that BitMart asked token holders to lock up their tokens one week before it announced that BitMart would cease operations by January 31, 2027.

Wang’s post was apparently deleted, while BitMart’s closure announcement on X was “withheld” from UK users “in response to a legal demand.” The UK withholding underscores the growing willingness of British regulators to restrict crypto-related communications under existing financial promotion rules.

The announcement promised an “orderly wind-down” and said, “withdrawal services will remain available.”

BitMart users rushed to withdraw their funds as the price of its token fell 80% between July 24 and July 26.

However, significant delays followed, with users still experiencing difficulties weeks later.

Co-founder denies rugpull

Eventually, BitMart co-founder Sheldon Xia broke a two-week silence to deny that the firm was carrying out an exit scam.

In a statement that included no figures or timeline, Xia said the team is still tallying and consolidating what it holds.

He also floated the possibility of “involving the courts and independent third-party auditors to provide a transparent report.” In previous exchange collapses, similar audit and court-supervised processes have taken months or years to yield results, and creditor recoveries have varied widely.

Protos has reached out to BitMart for comment and will update this piece if a response is received.