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A prominent crypto trader, known pseudonymously as "White Whale," has publicly accused the cryptocurrency exchange MEXC of requesting an in-person meeting in Malaysia to unlock approximately $3.1 million in frozen funds. This unusual demand comes after the trader completed all standard Know Your Customer (KYC) procedures, including facial verification and providing personal details.
Key Takeaways
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A crypto trader claims MEXC demanded an in-person meeting in Malaysia to unfreeze $3.1 million.
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Standard KYC procedures typically do not require in-person verification.
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MEXC stated it adheres to risk management policies and does not freeze assets without valid reasons.
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The trader has initiated a social media campaign to pressure MEXC for the release of funds.
Allegations of In-Person KYC Demand
"White Whale" shared screenshots of communications, allegedly from MEXC's global head of customer service, inviting the trader to Malaysia for an "exclusive invitation" and "in-depth communication with the leadership team" regarding the frozen assets. The exchange reportedly also dangled the possibility of a partnership and trading perks as incentives. However, the trader rejected the offer, citing safety concerns about traveling to a foreign country under such circumstances and criticizing the exchange's alleged coercive tactics.
MEXC's Response and Trader's Campaign
A MEXC spokesperson told Cointelegraph that the exchange "strictly adheres to risk management policies and does not freeze assets without valid reasons." The spokesperson cited potential reasons for asset freezes, including price manipulation, wash trading, and fraudulent trading, but did not directly address the specific claims about the Malaysian meeting. The trader asserts that all other KYC requirements have been met and that MEXC's terms of service do not mandate in-person verification.
In an effort to secure the release of the funds, "White Whale" launched a $2 million social media pressure campaign. This initiative involves other crypto traders minting a free non-fungible token (NFT) on the Base network and using the hashtag "#FreeTheWhiteWhale" to tag MEXC and its chief operating officer on social media. A bounty of $1 million USDC is promised to the first 20,000 NFT holders who participate, contingent on MEXC releasing the frozen funds.
Precedent of User Complaints
This incident is not the first time MEXC users have reported issues with frozen assets. In March, the exchange faced similar allegations regarding frozen customer assets, which it described as "ungrounded." Another user, Pablo Ruiz, reported that over $2 million in Tether (USDT) was frozen in April due to a "risk control" protocol, with limited explanation and automated responses from the exchange, including a 365-day account review period.
Sources
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