Wow, so an exchange can freeze funds with no legal paperwork just based on "tracking" and some see this as a good move.
Opening the Pandora's box, stage 3 (as it happened twice already with binance)
Opening the Pandora's box, stage 3 (as it happened twice already with binance)
It should only be a temporary freeze. Any blockchain analysis by an exchange that suggests money laundering, etc. could warrant that under their stated terms. The same might apply if coins are sent to Binance directly from darknet markets.
Here's the thing: I recall during the Wex.nz fiasco that Binance said they needed victims to file police reports regarding the stolen funds. (In their home countries? In Wex's registered country, Singapore? In Malta, where Binance is registered? Who knows.)
Absent that, they had no legal right to indefinitely freeze the assets. I have a hunch they froze funds temporarily in the direct aftermath but didn't end up really doing anything, since I never heard any news after that. This was back in October, I believe.
Slowly but surely exchanges are turning into a far worse version of banks, we have kyc, we have freezing accounts based on regions, we have funds frozen based on hunch something is not right, and what is worse if you have a problem with them most of the time you can't do anything since they've chosen to operate in countries with very lax laws.
They're "wild west" banks -- much worse than regular banks. They're centralized, they confiscate/freeze funds..... and they are untrustworthy, opaque and secretive, hiding in jurisdictions where customers can't come after them.
