Roughly three months after a pseudonymous crypto trader known as “White Whale” accused MEXC of freezing about $3 million in assets, the exchange has issued a public apology and released the funds.
In a post shared on X on Friday, MEXC’s Chief Strategy Officer, Cecilia Hsueh, admitted that the platform mishandled the situation, saying the company “messed up” in its dealings with the trader.
Back in July, MEXC had locked roughly $3.1 million of White Whale’s funds, citing internal “risk control rules.”
“We sincerely apologize to the White Whale. His funds have been released, and he can claim them at any time. Poor communication had escalated the conflict. I got emotional, and I shouldn’t have.”
Cecilia Hsueh
The freeze triggered a strong response from the trader, who launched a $2 million social media campaign against MEXC in August. He later said he increased the campaign’s budget to $2.5 million after claiming the exchange asked him to travel to Malaysia to resolve the matter in person.
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The White Whale Responds
In reaction to MEXC’s apology, the White Whale expressed gratitude for the gesture but remarked that the exchange did not specify what precisely it was apologizing for. He contended that being publicly identified as a possible criminal and subsequently as a fraudster had severely harmed his reputation.
The trader mentioned that the problem was far from resolved, asserting that numerous users encountered comparable fund freezes on the platform. He mentioned his intention to assist those impacted in regaining their funds and vowed to distribute the entire $3 million he retrieved to approximately 20,000 supporters who supported his campaign and to charitable organizations.
Community responses were varied but negative regarding MEXC’s management of the situation. Numerous Reddit users noted that a typical trader probably stands little chance of recovering frozen assets without public pressure or media focus.
After the apology, information from Nansen indicated that the value of MEXC’s native token, MX, decreased by approximately 3.5%, dropping from $2.30 to $2.22.
Not Your Keys, Not Your Coins
The MEXC–White Whale dispute has reignited one of crypto’s oldest warnings “not your keys, not your coins.” In simple; when users store their assets on centralized exchanges, they don’t truly control them. Instead, the exchange holds the private keys, meaning users’ funds can be frozen, delayed, or even lost without warning anytime.
Over the years, several major incidents have underscored this risk. For example; Binance and KuCoin both temporarily froze withdrawals during periods of market turmoil, citing security and liquidity issues.
The famous collapse of FTX in 2022 went even further, when the exchange locked billions of dollars in customer funds and left users with little hope of recovery.
Crypto lenders like Celsius and BlockFi were no different, when they halted withdrawals before declaring bankruptcy, trapping customers’ assets in legal proceedings that continue to this day.
These cases serve as a cautionary tale for traders who rely entirely on centralized platforms. While exchanges provide convenience and liquidity, they also introduce a single point of failure, one that self-custody wallets aim to eliminate.
