Tether-Backed Crypto Exchange Orionx to Shut Down After Discovering $7 Million Custody Gap

Orionx, a Chilean crypto exchange backed by stablecoin issuer Tether, announced it will permanently shut down after uncovering a significant discrepancy in customer asset custody. According to the company, a forensic audit revealed that more than $7 million worth of customer assets had been moved to wallets outside the exchange’s control, prompting an immediate suspension of withdrawals as the company works to recover as much customer funds as possible.

The closure comes just over a year after Tether led a significant funding round for Orionx as part of a broader push to expand crypto adoption across Latin America.

Internal Review Uncovers Balance Mismatch

According to reports citing the company’s criminal complaint, the issue was first identified in late August when a senior executive discovered a significant discrepancy between the balances recorded in Orionx’s internal systems and the actual assets held in custody. This finding triggered an internal investigation, followed by an external audit comparing company records against verifiable blockchain data, which confirmed shortfalls across several major cryptocurrencies held on the platform.

Company Files Criminal Complaint Against Former Executives

Orionx has filed a formal criminal complaint against two former co-founders who allegedly had access to the company’s crypto custody systems, accusing them of receiving substantial cryptocurrency transfers from company wallets. Both individuals have publicly denied any wrongdoing, stating they never acted against customer interests and that the true cause of the shortfall remains unclear.

Founded in Chile in 2017, Orionx had expanded into a broader payments and financial services platform across several Latin American countries before this incident led to its sudden closure.