OKX CEO Star Xu has reiterated the exchange’s stance on terminating user accounts linked to sanctioned entities, including Tornado Cash and Garantex, in response to complaints from a prominent influencer.
In a statement posted on X, Star Xu emphasized that OKX will close accounts found to be interacting with sanctioned entities. This includes depositing funds from or withdrawing funds to such entities, which will trigger the exchange’s compliance risk controls. Xu specifically mentioned Tornado Cash, a decentralized mixer, and Garantex, a Russian exchange, as examples of entities that are subject to these sanctions.
Xu’s comments follow a public complaint from user Satoshi Friends, who alerted his followers on X about potential risks of using OKX, particularly for users from the Commonwealth of Independent States. Satoshi Friends claimed that users risked sudden account blocks, fund freezes, and asset losses. “My account has been blocked, as well as the referral base accumulated over many years,” Satoshi Friends wrote, warning influencers about the financial and reputational risks of recommending OKX.
In response, Xu addressed these concerns by stating that Satoshi Friends had conducted significant transactions with sanctioned exchanges and DeFi protocols, leading to the account’s termination. Xu clarified that OKX allowed the user to withdraw clean funds before blocking the account but could not transfer data to a new account as it would breach compliance policies.
Tornado Cash has been a controversial topic, with various regulators deeming it problematic or illegal due to its role in obfuscating cryptocurrency transactions, which complicates law enforcement efforts to trace illicit funds. Earlier this week, blockchain security firm PeckShield reported that 14,500 ether ($35.2 million) stolen from the Nomad Bridge was transferred to Tornado Cash.
Furthermore, Tornado Cash developer Alexey Pertsev was denied bail in the Netherlands and sentenced to five years and four months in prison for money laundering charges earlier this month.
The Block has reached out to both OKX and Satoshi Friends for additional comments on the situation. As OKX continues to enforce its compliance measures, users are advised to be cautious of engaging with sanctioned entities to avoid account terminations and other repercussions.
