Key Takeaways
- MEXC has publicly apologized and released approximately $3 million in cryptocurrency holdings to a trader known as the White Whale, after holding the funds for three months.
- The exchange’s Chief Strategy Officer, Cecilia Hsueh, admitted to mishandling the situation and apologized for the delay and communication errors.
- The White Whale had launched a significant social media campaign and fundraising effort to recover the frozen assets, criticizing MEXC’s initial claims of AML violations.
- Despite the resolution for the White Whale, many users believe MEXC’s actions still reflect poorly on its customer service and risk management practices, especially for average users.
- The incident caused a minor dip in MEXC’s native token (MX) price following the public apology.
MEXC Admits Error and Releases Frozen Funds
After a period of three months, a pseudonymous cryptocurrency trader known as ‘the White Whale’ has had approximately $3 million worth of their assets unfrozen by the MEXC exchange. The exchange has also issued a public apology for its handling of the situation.
In a statement on X (formerly Twitter), MEXC Chief Strategy Officer Cecilia Hsueh acknowledged that the exchange f***-ed up in managing the case involving the White Whale. The funds, totaling $3.1 million, were initially frozen in July, with MEXC citing risk control rules as the reason at the time.
We apologize to [the White Whale], and his money is already released,” Hsueh stated. “He can claim it at any time. I messed up in communicating with him. I got emotional, and I shouldn’t have.”
This public admission and fund release followed a substantial social media campaign initiated by the White Whale. The trader launched a $2 million campaign targeting MEXC in August, later increasing the funding to $2.5 million. This effort was amplified after MEXC reportedly asked the trader to travel to Malaysia to resolve the issue and secure the release of the funds.
Trader’s Response and Continued Scrutiny
The White Whale responded to Hsueh’s apology on X, stating that while appreciated, it lacked specificity regarding what MEXC was apologizing for. The trader expressed a desire for an apology that addressed the implications of being labeled a criminal or scammer by the exchange, especially after initial anti-money laundering (AML) claims were reportedly debunked.
the work is not yet done, the White Whale declared, indicating an intention to pursue hundreds of similar cases to help other users recover frozen funds. They pledged to distribute the entire $3 million to 20,000 supporters of their campaign and various nonprofit organizations.
💡 The resolution for the White Whale has highlighted broader concerns about customer protection on centralized exchanges. Many community members feel that average users would not have the resources or platform to achieve such a outcome.
A Reddit user, Effective-Impact8054, commented on the situation: “Most regular users wouldn’t stand a chance in a situation like this. So yeah, it’s great that the White Whale finally got paid, but it doesn’t change the fact that MEXC froze a legit trader’s funds for months and only fixed it once the internet got involved.”
Market Reaction and Broader Implications
Following Cecilia Hsueh’s apology and the announcement of the fund release, the price of MEXC’s native token, MX, saw a decrease. Data from Nansen indicated that the MX token dropped by approximately 3.5%, from $2.30 to $2.22 around the time of publication.
⚡ This incident underscores the critical importance of transparent communication and efficient dispute resolution processes for cryptocurrency exchanges. It also emphasizes the power of community mobilization in holding platforms accountable for their actions.
Expert Summary
MEXC has apologized and released $3 million in crypto to a trader after a months-long freeze, following a public campaign by the trader. While the funds are returned, the incident has raised questions about customer service and transparency among exchange users.