OKX founder and CEO Star Xu defended the alternate’s asset-freezing insurance policies after a consumer accused the platform of locking up $40,000 in stablecoins held in accounts that had been bought quite than registered underneath the consumer’s personal identification.
The consumer, who goes by the title Captain Bunny on social media, said in a Sunday X put up that OKX froze about $40,000 price of International Greenback (USDG) stablecoins after triggering danger controls tied to 4 accounts. The consumer mentioned the funds had been wanted to cowl medical bills for his aged father.
The consumer acknowledged that the accounts had been bought in late 2023 and had been initially verified underneath different people’ names, a observe generally used to bypass restrictions on customers in mainland China.
In line with the consumer, OKX’s safety techniques later required facial recognition to entry the accounts. As a result of the accounts had been verified underneath completely different identities, the consumer was unable to finish the verification course of.
Associated: Sharplink pockets $33M from Ether staking, deploys one other $170M ETH
Xu defended the alternate’s account freezing practices in an X response on Monday, stating that transferring account management to somebody aside from the verified holder can be a severe “dereliction of responsibility to consumer asset safety and platform duty.”
“OKX requires all customers to make use of the platform with real-name verification. Account shopping for and promoting habits explicitly violates the OKX platform service settlement.”
Whereas shopping for verified accounts is a authorized grey space, Xu mentioned that the platform should still assist clear the consumer’s property, supplied that he fulfills three standards.
First, the people who offered the Know Your Buyer (KYC)-passed account should “explicitly disclaim” possession of the funds. Second, the accounts should be cleared of judicial freezes and regulation enforcement investigations. Lastly, the accounts want to offer “verifiable” proof of funds sources that meet regulatory necessities.
Crypto exchanges carried out KYC to adjust to Anti-Cash Laundering (AML) and counter-terrorism financing (CTF) laws, making certain authorized operation and consumer security.
New customers want to offer private info and verification via paperwork and a selfie to be authorized to begin buying and selling on most respected exchanges.
Associated: What crypto exchanges are watching in 2026, in keeping with OKX’s Rafique
Platform providers are for real-name verified people: OKX
OKX’s cryptocurrency providers are reserved for customers who’ve accomplished KYC with their true identification, in keeping with OKX’s assist desk.
“Upon verification, the platform service is just for the account’s real-name verified particular person. You beforehand acknowledged that the account’s real-name info belongs to another person,” wrote OKX in a Sunday X response to the investor.
Most crypto buyers expressed assist for the alternate’s insurance policies, even when that meant preserving the 4 bought accounts frozen.
“Principally, no alternate will open this sort of backdoor; as soon as they do, the implications can be unimaginable! Sooner or later, there shall be individuals who particularly depend on this to commit fraud,” wrote crypto investor Lugeweb3 in a response to the incident.
Cointelegraph reached out to OKX for remark, however didn’t obtain a response by publication.
Journal: Bitget’s Gracy Chen is on the lookout for ‘entrepreneurs, not wantrepreneurs’
