MEXC, a global cryptocurrency exchange known for its low trading fees and aggressive promotional campaigns, came under intense scrutiny in August following reports that it froze a traders account holding more than $3 million in crypto.
Bizarrely, MEXC requested that the trader travel to Malaysia in order to unfreeze his account, a request which the trader refused on fears for his own safety in a foreign country. The trader instead took to social media, claiming that they were locked out without prior warning or clear explanation.
This also prompted other traders to post screenshots showing their MEXC balances suddenly inaccessible. Some reported being asked to provide additional verification documents, while others alleged that withdrawals were disabled entirely. These accounts quickly went viral, sparking debate over MEXC’s internal controls.
Exchange Issues Public Apology
Fast forward to November and in response to the ongoing and growing public pressure, MEXC released an official apology acknowledging the incident.
The company stated that the freeze was linked to “abnormal trading activity” and claimed it was part of a temporary security review. MEXC also promised that users whose accounts were wrongly affected would be compensated once verification procedures were completed.
MEXC also stated that they grew so fast that their risk team was not able to keep up.
While the apology aimed to calm the situation, it did little to restore user confidence. Many traders remain skeptical, citing that it took an account with over 60,000 X followers several months to finally get his money back and that a normal account wouldn’t be so lucky.
Crypto commentators also noted that the situation could have been avoided if MEXC had been more transparent about the reasons for the freezes, rather than suggesting a trip to Malaysia, and provided better support channels during the incident.
$39 Million in Withdrawals Reflects User Distrust
Following the account freeze controversy, blockchain analytics platforms recorded more than $39 million in outflows from MEXC wallets within days.
Users appeared to be moving their assets to self-custody wallets or alternative exchanges. This sudden liquidity drain suggests that the event caused a loss of trust, similar to what has occurred in past exchange crises.
For many crypto investors, the old saying was evident: not your keys, not your coins. The sharp outflow showed growing caution among traders who prefer to store funds in personal wallets rather than rely on centralized exchanges that can restrict access without notice.
Questions Over Regulatory Oversight
Although MEXC operates internationally, it is not fully licensed in all jurisdictions where it serves users. This leaves customers with limited recourse when disputes arise.
Crypto analysts have pointed out that these types of controversies often lead to temporary market instability but also encourage better industry practices over time. Whether MEXC can rebuild its reputation will depend on how quickly it unfreezes the affected accounts and implements better policies.
Lessons From MEXC: Moving Funds to Personal Wallets
The incident at MEXC serves as a warning for traders who keep significant funds on centralized exchanges for long periods of time. While convenience and liquidity are appealing, users should remain cautious and maintain personal control over their assets, especially if they are holding for the long term.
The message has never been clearer: leaving your assets on crypto exchanges exposes them to risks like hacking, theft, and unwarranted freezes. After all, you don’t control the private keys – you are only relying entirely on the platform’s security, which can sometimes fail.
That’s exactly why smart investors are already moving their funds to secure, self-custodial wallets like Best Wallet to enjoy full control and better protection.
At its core, Best Wallet ensures that the fundamental credentials required to access and transfer crypto assets remain solely with the user, offering complete peace of mind and security. Similarly, the wallet contributes significantly to protecting financial privacy through its no-KYC posture, ensuring that users’ personal and financial details stay more private.
Its clean, user-friendly mobile interface is another major highlight, allowing newcomers to easily navigate the wallet’s features without any assistance. Furthermore, since it is a multi-wallet app, it also further allows users to connect other wallets to it, and manage different portfolios from one place.
However, at the same time, it offers a vast range of features that can help investors take the most advantage of major opportunities in the market. For instance, there is a staking facility where users can explore supported assets for passive gains.
Next is its multichain functionality, which currently supports leading networks such as Bitcoin, Ethereum, Solana, Binance Smart Chain, Polygon, and Base, empowering users to manage all the cryptos running the chains. To top it up, Best Wallet supports buying crypto with fiat and cross-chain swaps, regardless of the chain they are on.
There’s also a token launchpad primarily designed to let investors discover and gain entry into new cryptocurrencies that are still in their early-stage token sales. Considering the way at which it seamlessly balances ease of use with an abundance of features, it’s hardly surprising that it has become a major hit despite launching barely a year ago.
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