OKX Freezes $40K in Stablecoins After User Buys KYC Accounts

Crypto exchange OKX has frozen approximately $40,000 in stablecoins across four accounts after the account holder publicly admitted to purchasing them from other users. The incident began on January 12 when the user, known as Captain Bunny on X, reported blocked withdrawals.

https://t.co/aSW6zFwWGk

— 小兔叽叽 (@captain0bunny) January 11, 2026

OKX’s internal risk controls flagged verification inconsistencies during a routine security check. The exchange confirmed that the freeze resulted from identity and ownership issues, not from any concerns about the intended use of the funds.

OKX founder and CEO Star Xu responded directly on social media. He framed the action as a compliance matter, not a discretionary decision. The case has reignited debate over how centralized exchanges enforce know-your-customer requirements in practice.

Purchased Accounts Expose Identity Gaps and Trigger Security Protocols

Captain Bunny disclosed that the four accounts were purchased in late 2023. The accounts had been originally verified under other individuals’ names. This practice is commonly linked to attempts to bypass regional restrictions, particularly in mainland China.

Such activity directly violates the terms of service enforced by most centralized exchanges. OKX’s security systems later required facial recognition checks tied to the original identity documents submitted during verification.

Because the accounts were not registered in Captain Bunny’s name, he could not complete the process. This triggered restricted access and blocked withdrawals under the platform’s risk protocols.

The user stated the accounts remained inactive until November 2025. He then deposited $10,000 in USDG stablecoins into each account to participate in an OKX promotion offering up to 10% annual yield.

When he attempted to withdraw the funds, the selfie verification request exposed the identity mismatch. The exchange immediately froze all four accounts pending further review.

Star Xu Defends Compliance Stance and Rejects Public Pressure

Responding publicly on X, Star Xu rejected calls to lift the restrictions based on social media pressure. He stated that allowing account control to transfer away from the verified identity holder would represent a serious compliance failure.

Xu explained that OKX requires all users to operate under real-name verification. This policy aligns with anti-money laundering and counter-terrorism financing standards enforced globally.

He added that buying or selling verified accounts explicitly violates the platform’s service agreement. Such activity introduces heightened risks of fraud and potential abuse, according to the CEO.

However, Xu noted that OKX may consider asset resolution under specific conditions. These include formal confirmation from original account holders that they do not claim ownership of the funds.

Additional requirements include verification that accounts are not subject to judicial freezes or law enforcement investigations. Users must also submit regulation-compliant proof of fund sources.

Xu emphasized that emotional appeals cannot override compliance assessments. He described OKX’s actions as transparent, legally grounded, and open to scrutiny.

Industry Backs Strict KYC Enforcement Amid Rising Security Threats

Following Xu’s comments, OKX support reiterated that platform access remains strictly tied to real name verified account holders. The clarification aligned with existing policy without introducing new conditions.

您好，非常抱歉。经核实，平台服务仅针对账户实名本人。您此前表示账户实名信息属于他人，目前因触发人脸识别，导致无法登录账户，相关操作仍需由实名本人进行验证，感谢您的理解与支持。…

— OKX中文客服 (@OKXHelpDesk_cn) January 11, 2026

While some commentators criticized the exchange, many crypto investors backed OKX’s position. Several argued that creating exceptions for purchased accounts would weaken security safeguards across the industry.

Industry data reveals that nearly 80% of crypto-related hacks in early 2025 targeted centralized platforms. Total losses exceeded $2.4 billion, including the widely reported Bybit $1.5 billion breach.

Against this backdrop, strict enforcement of KYC and account ownership rules has gained support as a necessary defense. Centralized exchanges remain prime targets for sophisticated attacks.

In later posts, Captain Bunny acknowledged responsibility for the compliance lapse. He stated he would pursue resolution by contacting original KYC account holders through legal channels, following Xu’s outlined steps. OKX declined additional comment beyond its public statements.