Why can exchanges freeze account. | Bitcointalksearch.org

adzino

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I have been wondering of people telling me exchanges can freeze accounts, that makes me very afraid to use exchanges to trade, a friend of mine told me hitbtc freezed his account. That makes me here to ask the reason why exchanges can freeze account.

Why are exchanges freezing accounts?
What can I do to make them not freeze my account?
What are the best exchanges to use?

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

When you create an account, you agree to the terms and condition of the exchange. As long as you don't breach any terms, your account won't be frozen. The terms and conditions explains every act that might cause you to lose access to your account.
Besides the terms and condition of their own website, they have to comply with the AML. So if they see any huge transaction, they usually have to report it to the higher authority and may temporarily freeze the account.

FOPL

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First of all, if you familiarize yourself with what can make them freeze your account you will have an idea of what to do to prevent that. Mostly it will have to do with violation of terms. Probably if they find your activities suspicious.

With regards to KYC almost all exchange require KYC for withdrawal of large amounts. You can trade and withdraw freely without having to pass KYC. I will recommend https://changenow.io/ which is an instant that requires no account creation and KYC making you exchange operations anonymous. You can exchange small amounts and there is no upper limits on exchanges.

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Quote from: conhela on August 09, 2020, 02:59:54 PM

The problem with freezing funds is that some people are prone to not giving KYC or similar stuff, privacy reasons and so on. hitbtc is a exchange that doesn't require KYC up front, but if you're withdrawing large amounts of money you're likely to be asked for KYC, and you can't withdraw until you fulfil it. A good way to not get frozen funds is to fill KYC and just follow whatever support responds, people ignore support responses sometimes lol.

They have a 1BTC cap for withdrawals on non-KYC accounts as per what they have written on their "Verification" page.

As long as you are a small cap trader or a bounty hunter is attempting to sell their tokens you should not have any problem but if you are looking for some serious trading and having a bigger daily volume to trade with then it is not for you. For that go for a exchange which is having some better customer support and less withdrawal fees than Hitbtc and also where you get yourself verified first and link your bank account.

Obviously this is not possible for countries where bitcoin is banned. Grin

conhela

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I have been wondering of people telling me exchanges can freeze accounts, that makes me very afraid to use exchanges to trade, a friend of mine told me hitbtc freezed his account. That makes me here to ask the reason why exchanges can freeze account.

Why are exchanges freezing accounts?
What can I do to make them not freeze my account?
What are the best exchanges to use?

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

The problem with freezing funds is that some people are prone to not giving KYC or similar stuff, privacy reasons and so on. hitbtc is a exchange that doesn't require KYC up front, but if you're withdrawing large amounts of money you're likely to be asked for KYC, and you can't withdraw until you fulfil it. A good way to not get frozen funds is to fill KYC and just follow whatever support responds, people ignore support responses sometimes lol.

Slow death

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

Why are exchanges freezing accounts?

exchanges have owners (who are mostly anonymous people but who ironically keep asking customers to do KYC) and unfortunately the exchange owner can block your account whenever he wants

Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

What can I do to make them not freeze my account?

Just make sure you don't break the TOS

Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

What are the best exchanges to use?

Binance, but you said you don't want exchanges that have KYC, so get ready to see your money frozen on those shady exchanges

Findingnemo

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Quote from: Kupid002 on August 07, 2020, 11:01:47 AM

Quote from: Findingnemo on August 07, 2020, 04:45:43 AM

Almost you need to pass KYC to use centralized exchanges and it is the only way if you want to trade your cryptos for fiat and vice versa.For trading cryptos there are decentralized exchanges where the trading volume is really low compared to the centralized exchanges and also fee could be a lot.

So if you want to be a trader then you should be ready to do KYC at any time.And the reason for freezing accounts on exchanges are like receiving funds from blacklisted addresses, or what they doubt you involved in any shady activity or money laundering.

yeah right , you need to always prepare and ready to make aKYC in case you emergency need it there are centralised exchange that you can use even without a KYC but there are daily withdrawal limit . Example of that exchange is binance and kucoin you can use that exchange without a problem if its only for small funds .

They offer withdrawal limits but we can't be 100% sure they will never ask our any personal details, if government made strict regulations they can change their verification system at any time like what happened in Localbitcoins.com last year and in case of any suspicious activity they might lock your account and ask you to prove that you are the real owner of that account.

Kupid002

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Quote from: Findingnemo on August 07, 2020, 04:45:43 AM

Almost you need to pass KYC to use centralized exchanges and it is the only way if you want to trade your cryptos for fiat and vice versa.For trading cryptos there are decentralized exchanges where the trading volume is really low compared to the centralized exchanges and also fee could be a lot.

So if you want to be a trader then you should be ready to do KYC at any time.And the reason for freezing accounts on exchanges are like receiving funds from blacklisted addresses, or what they doubt you involved in any shady activity or money laundering.

yeah right , you need to always prepare and ready to make aKYC in case you emergency need it there are centralised exchange that you can use even without a KYC but there are daily withdrawal limit . Example of that exchange is binance and kucoin you can use that exchange without a problem if its only for small funds .

Findingnemo

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I have been wondering of people telling me exchanges can freeze accounts, that makes me very afraid to use exchanges to trade, a friend of mine told me hitbtc freezed his account. That makes me here to ask the reason why exchanges can freeze account.

Why are exchanges freezing accounts?
What can I do to make them not freeze my account?
What are the best exchanges to use?

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Almost you need to pass KYC to use centralized exchanges and it is the only way if you want to trade your cryptos for fiat and vice versa.For trading cryptos there are decentralized exchanges where the trading volume is really low compared to the centralized exchanges and also fee could be a lot.

So if you want to be a trader then you should be ready to do KYC at any time.And the reason for freezing accounts on exchanges are like receiving funds from blacklisted addresses, or what they doubt you involved in any shady activity or money laundering.

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

You can use Binance and OKEx exchange, they are reputable exchange so far. Also, you don't need to give your personal identity as long as your withdraw amount is less then 100 btc per day.

As for the exchange can freeze the user's asset you can read their term service before create an account. Each exchanges will have different rule or different authority to do that.

condoras

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I have used (and still use some of them) almost all the exchangers that come/ gone/ stay over the years. You name it.
Yes, I faced issues like late or "missing" and "unconfirmed" deposits/ withdrawals but none of them froze my coins. So if you follow their rules, which is almost the same in all of them, then you will not have a problem.

Idk though why a lot of people say that Binance is the best. How an exchanger can be the best when it doesn't let you trade the whole amount of your coins and I'm not referring to tokens either the limitation of an order. The only ones that have this "great" rule are Binance and Hitbtc...

As for where they are based on papers (Seychelles or any other "tax heaven") that don't make them untouchable. For sure it makes them richer and easier to "move" and "do things"...

sunsilk

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Quote from: Darker45 on August 05, 2020, 09:11:51 PM

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-Best exchange to use? Binance all the way.

Let OP be informed that while Binance has relatively lesser complaints than the likes of YoBit or HitBTC, they also have records of suddenly requiring KYC from certain users who are making transactions well within their non-verified limits.

I can also say that Binance is the best so far that I have used. The friend of OP that used hitbtc isn't the only person that experienced that freezing of funds on that exchange. Most experiences that I've read which has been shared were bad experiences on the said exchange.

Some incidents also have reported in other exchanges that even there's no suspicious thing the user is doing, an exchange can do whatever they want. But once a staff from the exchange validates the reason, the user denies the reason that's brought to him.

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Quote from: stomachgrowls on August 05, 2020, 05:53:01 PM

-Once you do violate their Terms and conditions or you do make such fraudulent activity then you would really face up such issue.

Freezing of accounts does not only follow violations of the exchange's TOS or fraudulent activities. Sometimes it is done out of mere suspicion or probably out of nothing at all that it makes the user wonder how in the world his/her usual activities became suddenly suspicious that they warrant such drastic measure.

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-Trade normally and just follow platform rules then you're good.

Again, not a guarantee.

Quote

-Best exchange to use? Binance all the way.

Let OP be informed that while Binance has relatively lesser complaints than the likes of YoBit or HitBTC, they also have records of suddenly requiring KYC from certain users who are making transactions well within their non-verified limits.

stomachgrowls

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

Why are exchanges freezing accounts?
What can I do to make them not freeze my account?
What are the best exchanges to use?

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

-Once you do violate their Terms and conditions or you do make such fraudulent activity then you would really face up such issue.
-Trade normally and just follow platform rules then you're good.
-Best exchange to use? Binance all the way.

Your friend had used HitBtc which had been known into this community due to its shady stuff and ridiculous high fees.So i wont recommend on using up that platform.
In binance you can have 2BTC limit per day on a unverified account which i do believe its already sufficient for most users.

figmentofmyass

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Quote from: The Sceptical Chymist on August 05, 2020, 02:48:11 PM

Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Here's the thing: the no-KYC exchanges that are left are likely ones that exist in countries where they're not regulated, which means they can essentially do whatever they want. Yobit comes to mind immediately, but I'm sure there are others.

that's why the seychelles is so popular. binance is there. so is bitmex, poloniex, and other well known brands that offer unverified trading. there is a world of difference between them and selective scammers like hitbtc and yobit. in the wild west there are plenty of scammers about, but reputation and branding mean a lot. binance is not at all interested in being lumped in with the likes of hitbtc and yobit.

keep in mind, when people complain about frozen accounts and confiscated coins, we're in no position to judge what actually happened. if someone deposits OFAC sanctioned coins, or coins linked to an exchange hack, or withdraws directly from a DNM etc they are never gonna be up front about it, and we can't blame a centralized exchange for having terms that block those deposits. we can only take an overview and judge by the numbers whether an exchange is likely to be engaging in selective scamming and fraud.

Quote from: The Sceptical Chymist on August 05, 2020, 02:48:11 PM

And if you have an exchange that makes its own rules and isn't accountable to anyone, they can freeze your account for whatever reason they like. The KYC exchanges which are regulated can't get away with anything they want to, and they'd have to have a valid reason to freeze your funds.

that's nanny state reasoning tbh. exchanges like bitstamp and paxos freeze huge sums of money for months at a time without communicating with their clients. we just take their word for it that their AML/KYC related reasons are "valid".

i trust bitstamp like a trust a bank robber. i would never deposit coins with those scumbags.

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Here's the thing: the no-KYC exchanges that are left are likely ones that exist in countries where they're not regulated, which means they can essentially do whatever they want. Yobit comes to mind immediately, but I'm sure there are others. And if you have an exchange that makes its own rules and isn't accountable to anyone, they can freeze your account for whatever reason they like. The KYC exchanges which are regulated can't get away with anything they want to, and they'd have to have a valid reason to freeze your funds.

Usually I read complaints about gambling sites freezing accounts and not exchanges, but I know the latter do it as well. I've never used hitbtc (never even heard of it, either) but my guess is that they're unregulated.

Quote from: gentlemand on August 05, 2020, 05:12:03 AM

Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Then you're going to get screwed at some point.

I agree, because I don't think there are many non-KYC exchanges out there with solid reputations that you could trust not to freeze your account for some arbitrary reason. So OP, just watch out if you're going to go that route. Don't keep a lot of funds on an exchange for long, and I'd probably advise that you trade in small amounts--and read their rules, too. You don't want to end up breaking one of them and run into a problem that no one can help you with.

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Aside from mentioned above, some exchange freeze an account due to selective scamming and suspicious asking KYC docs, once you deposit large amount they will tell you that your account has suspicious activity even there's not and will ask lots of documents not just your ID for KYC unfreeze your account. So beware of those new and unfamiliar exchanges.

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You can try Uniswap or Binance DEX if you want, but remember that you can't use atomic swap there, so you'd stuck with either ERC or BEP tokens for trading. Not to mention the slippage and fees might be higher than you thought. If you're dealing with large volumes, maybe your trading could be affected. Binance or Kucoin, or even Bithumb Global can be a good option for no-KYC option if you need bigger volumes.

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Quote from: gentlemand on August 05, 2020, 05:12:03 AM

I would never use an exchange with optional KYC unless I'd done that KYC because if you use it a lot the chances of your funds being frozen are much, much higher than somewhere you've already cleared yourself with.

how do you know? what are the chances? for a lot of people, not giving up KYC documents is worth the risk. that's how i feel myself. i still use unverified accounts for the majority of my trading.

Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

i suggest binance or kucoin. as with any centralized exchange, there is a non-zero chance of having KYC sprung on you. complaints about this at binance and kucoin are relatively few and far between.

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Then you're going to get screwed at some point. I would never use an exchange with optional KYC unless I'd done that KYC because if you use it a lot the chances of your funds being frozen are much, much higher than somewhere you've already cleared yourself with.

There are properly decentralised options where freezing can't happen but there aren't many options. That's what you need to investigate.

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Quote from: Oshosondy on August 04, 2020, 05:06:55 PM

I have been wondering of people telling me exchanges can freeze accounts, that makes me very afraid to use exchanges to trade, a friend of mine told me hitbtc freezed his account.

That friend of yours probably did not tell you what part of the TOS they were breaking in the first place. And you didnt bother to ask because, hey they are your friends right? Roll Eyes

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Why are exchanges freezing accounts?

Mostly money laundering. I will not be impartial to hitbtc here, even though they have scam accusations. This can happen on any popular or less popular exchange.

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What can I do to make them not freeze my account?

Do not launder money or break their TOS.

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What are the best exchanges to use?

That is a topic for another thread.

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I like no kyc exchanges, please do not advice me to use any kyc exchange. I prefer exchanges that do not demand for kyc or the ones that makes kyc not mandatory?

Every CEX will ask for KYC one day or another. Small cap traders whose daily traded volume is <1BTC should not worry about it.

DEXes dont ask for KYC but they are more risky to use in terms of getting hacked or seizure by authorities.

Topic: Why can exchanges freeze account. (Read 212 times)