Major Russian exchange freezes $4m of user assets, citing money laundering

Russian cryptocurrency exchange Beribit has faced fraud allegations after refusing to refund customers’ money.

Russian media reported that the management of the crypto exchange demanded a certificate from Beribit victims that the income generated was legal in order to avoid paying debts. Only 19 out of 100 foreign exchange customers received money.

According to some estimates, the total amount of funds blocked in Beribit can reach 400 million rubles, that is, about 4.3 million dollars. Previously, representatives of the platform confirmed that the losses amounted to 24.9 million rubles (about $ 263,000), but this is only a small part of the total amount of frozen assets.

Only 11 customers passed the audit and are expected to receive their funds in the coming days. However, around midnight, users received messages from Beribit demanding that they provide proof that they were not laundering money through exchanges.

Crypto wallet holders suspect that the exchange is changing the terms, asking for personal information and looking for an excuse to pocket the money.

The scandal surrounding Beribit broke out in March when searches were carried out at the company’s Moscow offices. In April, the exchange reported technical issues with cryptocurrency withdrawals, which it later explained with a change in management and reporting inconsistencies. After a crowd of angry customers showed up outside Beribit’s office, the company promised to pay users in full.

However, Beribit has not fulfilled its promises so far and platform customers continue to complain about not being able to withdraw money.