OKX CEO, Star Xu, announced that any accounts on the OKX exchange found to be involved with Tornado Cash would be terminated. This announcement is part of OKX’s efforts to uphold financial integrity and ensure compliance with international sanctions.
Tornado Cash Under Scrutiny
Tornado Cash has recently been involved in laundering stolen funds from various protocol hacks. On August 7, the hacker behind the attack on the Rain crypto exchange started laundering 1,155 Ether through Tornado Cash.
Tornado Cash, a decentralized service that hides the origins and destinations of cryptocurrency transactions, has become a hot topic. While it’s favored by users who value privacy, it has also been used by bad actors to launder stolen funds.
Xu emphasized that if users deposit money from sanctioned entities like Garantex and Tornado Cash into OKX accounts, or try to withdraw funds to these entities, the exchange’s risk control mechanisms will activate, leading to account closures. “We must comply with sanctions, including those from the US,” Xu stated.
Warning from a Concerned User
The announcement follows a public warning from a user known as Satoshi Friends. He urged users, particularly those from Commonwealth of Independent States (CIS) countries, to withdraw their funds from OKX and stop using the exchange. He cited OKX’s strict policies and personal experiences, claiming that users risk having their accounts suddenly blocked and funds frozen.
Satoshi Friends mentioned that some influencers had their accounts blocked, and their funds were only partially restored after direct talks with the OKX team.
OKX’s Response
Xu responded by acknowledging that the user’s account had significant transactions with sanctioned exchanges or DeFi protocols. He noted that the user was allowed to withdraw clean funds before the account was blocked. However, OKX refused to transfer the user’s data from an old account to a new one, stating that it would go against their compliance policy.
Xu reiterated that OKX strictly follows compliance guidelines and does not onboard customers on the Specially Designated Nationals list. He reassured most users that they are unlikely to be affected by these measures since they do not conduct transactions related to sanctioned entities.
