A high-profile crypto trader known as “The White Whale,” alleges that MEXC demanded an in-person trip to Malaysia to release $3.1 million in frozen funds, which is a move that breaks standard crypto exchange compliance practice.
Key Takeaways:
- MEXC allegedly requested the trader to travel to Malaysia for an in-person meeting with its leadership to release $3.1M in frozen funds.
- The request followed completion of standard digital KYC procedures, with no in-person verification mentioned in MEXC’s Terms of Service.
- The trader declined, citing security concerns amid rising incidents of crypto kidnappings.
A pseudonymous crypto whale, “The White Whale,” claims MEXC instructed them to travel to Malaysia to meet with executives to unfreeze $3.1M in holdings. Despite completing live video verification, proof of address, phone confirmation, and digital KYC, MEXC’s Global Head of Customer Service offered a VIP-style invitation with luxury accommodations as a “manual verification process as an exception.” The White Whale rejected, citing the lack of such requirements in Terms of Service and potential risks.
On their recent X (formerly Twitter) post, The White Whale posted the details of their conversation with the MEXC’s Global Head of Customer Service, named Derrick, in Telegram, while being skeptical about the requirements he needs to accomplish in exchange of releasing of their frozen funds.
Photo: Snapshot of The White Whale’s conversation with MEXC’s Global Head of Customer Service.
Rising Security Concerns
The trader’s refusal revolved around personal security fears, particularly amid increasing reports of crypto-related kidnappings targeting prominent holders. On their X post, the trader emphasized their security concerns about the requirement of in-person verification, pointing to the heightened risk, noting:
Why would someone with over $100M on-chain ever agree to fly to another country and enter the lion’s den of an organization he's publicly protesting against?
Exchange’s Side and Compliance Practices
MEXC has not publicly addressed the Malaysia request but defended its risk-control policies, noting it can freeze assets for manipulation, wash trading, or fraud. Still, the face-to-face demand has no stated basis in its Terms of Service.
Community Backlash and Campaign
The White Whale launched a social campaign, offering a $2M USDC bounty split among 20,000 free NFT holders on Base. Participants must tag MEXC/its COO on X using #FreeTheWhiteWhale. This reflects the growing impact of grassroots pressure on exchanges.
What This Means for Traders and Exchanges
MEXC’s face-to-face demand to release frozen funds marks a deviation from crypto industry norms. The episode raises key questions about user safety, compliance standards, and balancing risk controls with customer access. It’s likely to drive scrutiny of MEXC and spark broader debate over verification rules and emergency protocols.
Summary
A trader known as The White Whale alleged MEXC demanded they travel to Malaysia to unfreeze $3.1M, despite completing KYC remotely. The unusual request absent from the exchange’s Terms of Service sparked backlash and safety concerns amid kidnapping risks.
MEXC defended its general freeze policies but not the Malaysia trip demand. The case highlights rising tension between exchange compliance controls and user security, with community-led campaigns amplifying accountability. Industry attention now shifts to whether exchanges adopt clearer standards for dispute resolution and emergency access.
