- MEXC crypto exchange has frozen accounts and seized funds of traders, accusing them of “abnormal trading activities.” Several traders have reported losses of tens of thousands of dollars in tokens.
- MEXC cites its terms of service, which allow it to investigate violations, determine violations unilaterally, and take actions like freezing accounts without notice.
- The incident highlights the risks of trusting centralized crypto exchanges with custody of funds, as they can restrict access or seize funds per their terms.
MEXC’s users have been complaining about account restrictions since Dec. 16. On Twitter, the pseudonymous trader Vida revealed a loss of $92,000 in Tether (USDT) tokens. The funds were wiped out after Vida made profits from multiple trades over 15 days on MEXC’s futures market.
“I contacted the support and submitted documents, and then the second day, funds in my account were TOTALLY WIPED OUT along with the order history,” Vida wrote.
Screenshots shared by Vida show MEXC’s support team acknowledged their risk control system flagged an issue with the trades. The trades were investigated by MEXC’s staff.
MEXC Cites Terms of Service for Account Restrictions
MEXC’s terms of service give the exchange the “right to investigate any violation of this Agreement, unilaterally determine whether you have violated this Agreement, and take actions under relevant regulations without your consent or prior notice.”
As per the terms, MEXC can take actions like freezing accounts, closing orders, reporting incidents to authorities, and publishing details on violations and actions taken.
Background on MEXC Exchange
MEXC is a centralized crypto exchange established in 2018 and headquartered in Seychelles. According to its website, trading services are not available to users in the United States, Canada, and China. The exchange offers trading for over 2,000 pairs.
The recent account freezes and fund seizures highlight the risks involved when trusting centralized exchanges with custody of funds.
