Jan 31, 2023 at 03:50On Jan 18, 2023, Russian-speaking Binance users reported that their accounts were blocked and were not able to withdraw their money. They created a group chat on Telegram to discuss the issue and say that the accounts were blocked without any warning.
The over 1000 (and counting) group members swiftly pieced together the dots between the frozen accounts and the crackdown on crypto company Bitzlato by the United States Department of Justice. Further, the U.S. Financial Crimes Enforcement Network fueled the fire by placing Binance on the list of top Bitcoin counterparties of Bitzlato.
‘Losses and dirty money’ accusations
In the chat, numerous members candidly confessed to utilizing Bitzlato. Others exposed intricate specifics of transactions between their Bitzlato and Binance accounts.
One chat member lamented, “Though I haven’t been banned yet, I’ve suffered losses on BTC-e, Wex, and now Bitzlato. I view these bans as utter lawlessness.”
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Another user pondered, “The blockages related to Bitzlato are absurd. They haven’t even been found guilty yet, it’s all just accusations. So, how can this money be considered ‘dirty’?”
A Binance representative confirmed that the recent account suspensions were indeed tied to the Bitzlato case.
“Our compliance and investigations team, in response to the Bitzlato situation, temporarily froze the accounts of some users from various countries, including Eastern Europe and the CIS,” the spokesperson revealed.
“Presently, the majority of accounts — over 90% — have been freed and users have been notified. Rest assured, all funds are secure. A minor fraction of individuals — fewer than 20 — have been given relevant information for law enforcement contact.”
Word of caution
Binance also offered guidance to users, suggesting they peruse the exchange’s article on possible reasons for account blockages and how to handle such a predicament.
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