Recently, a high-profile dispute between a crypto trader known as White Whale and the MEXC exchange reached a resolution, highlighting issues around fund freezing and communication in the evolving crypto exchange landscape. After months of tension and public campaigning, MEXC apologized and released approximately $3 million in funds that had been frozen due to internal risk management measures. This incident highlights the continuing challenges in cryptocurrency regulation, user rights, and transparency on centralized exchanges.
- MEXC has publicly apologized after freezing a trader’s $3.1 million in assets for several months due to its risk management policies.
- The exchange’s chief strategy officer acknowledged miscommunication that led to the release of funds.
- White Whale launched a high-profile social media campaign to escalate the situation and demand accountability.
- This incident caused a slight decline in MEXC’s native token, MX, reflecting the market’s sensitivity to currency disputes.
Nearly three months after a pseudonymous crypto trader known as White Whale reported that the MEXC exchange had frozen nearly $3 million in assets, the exchange’s leadership issued a public apology and returned the funds. The resolution comes after a period of public outcry and social media campaigns that drew attention to concerns over transparency and risk management in the crypto industry.
MEXC Chief Strategy Officer Cecilia Hsueh acknowledged the exchange’s mistake in a Friday post on X (formerly Twitter). She acknowledged that the company had “failed” in the way it handled the Moby Dick incident and apologized for miscommunications. “He can always claim it. I made a mistake in communicating with him. I got emotional and I shouldn’t have done that,” Xue said.
The White Whale’s prolonged freeze sparked a social media campaign in which he announced an increase in fundraising efforts from $2 million to $2.5 million. He claimed that MEXC even requested him to fly to Malaysia to resolve the issue and facilitate the release of funds. Despite the resolution, the trader stressed that grievances continue, saying that “most regular users have no chance in this situation,” criticizing the imbalance of power at play in crypto trading and custody issues.
This controversy also affected MEXC’s market valuation. Following Hsueh’s public apology, the exchange’s token (MX) fell by about 3.5%, falling from $2.30 to $2.22, according to Nansen data.
While some in the community appreciated the apology, others were skeptical. White Whale responded on social media, noting that the apology lacked clarity on what exactly it was apologizing for, and criticizing previous accusations of the exchange that implied crime or fraud, which it considered harmful and unfounded.
This incident exemplifies broader concerns within the cryptocurrency ecosystem regarding user protection, regulatory compliance, and transparency of centralized exchanges. As regulators around the world increase their scrutiny of crypto markets, these incidents highlight the importance of clear communication and adhering to fair risk management practices in protecting traders’ assets.