The Changelly-Monero [XMR] controversy is back in the cryptocurrency space. This time, a spokesperson of Changelly, one of the leading cryptocurrency exchanges in the world confirmed that the platform was withholding privacy coins in case of the transactions appearing to be suspicious.
In a discussion with AMBCrypto, Ilya Bere, Chief Operating Officer of Changelly stated:
“Although the measures we take may seem to be unhealthy at the first glance, they help us prevent fraud and protect innocent users. Unfortunately, due to the untraceable nature of XMR, it’s been frequently used for the fraudulent activities. Not only Monero, however, but also every cryptocurrency may be involved into that.”
Bere also spoke about the recent incident where a large amount of XRP to BTC transaction was found suspicious by the platform, post which, it froze the transaction until clearance. However, the user who initiated the transaction could not be found but the funds were returned to the real owner of XRP.
The COO also stated that Changelly has received hacked funds from different services such as Bancor, Bitthumb, Coincheck, among others. Furthermore, he claimed that the exchange offered legal assistance to the authorities in finding the hackers and recovering the funds.
In July, the cryptocurrency platform was also involved in a case of security breach wherein about $23.5 million was drained. A part of the stolen cryptocurrency was reportedly transferred to Changelly. Regarding this, the CEO of Changelly stated that the hack was unpredicted and the platform froze the stolen BNT [Bancor’s native token], as a recovery procedure.
Subsequently, regarding the government regulations in the cryptocurrency space, Bere said that it is inevitable to avoid regulatory bodies for the cryptocurrency exchanges and other services as it is “a side-effect of mass adoption”.
Recently, Monero [XMR] and other privacy coins have been scrutinized by several exchanges as the transactions made with these coins cannot be traced and is used for illegal activities. The Monero mining malware has also seen a significant rise over the past few months, running in the background of several online portals.
In addition, it has also gained the attention of governments, such as Japan. The country is known to be one of the earliest adopters of cryptocurrencies and the blockchain technology. The regulatory body, Financial Services Agency of Japan [FSA], had recently instructed cryptocurrency exchanges to delist privacy coins due to a notion that this cryptocurrency sector is most favored by the underworld.
Earlier this year, many users waged a war against Changelly alleging the platform for making money through fraudulent activities and stealing millions from its user-base. The controversy surrounded Changelly when it launched a mandatory KYC [Know-Your-Customer] procedure for the members.
At the time, users reported a case of no-information regarding the KYC, which resulted in non-compliance from the customer’s end. Post this, many transactions that were left unverified due to KYC non-compliance were withheld.
In the same timeframe, the coin disappeared from the platform, leaving the users uninformed, eventually leading them to believe that it was delisted. However, during an interview with AMBCrypto, the platform clarified that the coin was not delisted but was on hold due to an update.
Vector0x16, a Redditor and a cryptocurrency follower shared an opinion and stated:
“My advice besides not using Changelly is to never exchange all of your stash in a single transaction, no matter what service or exchange you use. You only own your coins if you own the private keys to the wallet which holds them.”
Another Reddit user also wrote:
“There is a reason that Changelly is listed under the “scams” heading of this sub. They have even stopped responding to these posts because they get too much abuse here. Do not use Changelly. Simple.”