CoinDCX restricts crypto withdrawals citing higher compliance requirement

economictimes.indiatimes.com:

Cryptocurrency exchange CoinDCX had paused its crypto withdrawal facility without prior communication, sparking concerns among users. The recent liquidity crises at several institutions, including Celsius Network, which paused crypto withdrawals and transfers, has stirred fear among Indian retail, ET reported on June 21. In this backdrop, CoinDCX's decision to restrict crypto withdrawals have caused a furore on social media.

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“The restriction is an enhanced measure to strengthen our safety protocols and was gradually initiated over the past one month for multiple users,” a spokesperson for CoinDCX said in a statement. “This measure involves a series of steps such as improving know your customer (KYC) coverage, enhancing the risk framework for crypto deposit and withdrawal, and integrating with compliance and monitoring tools.” After the issue gained traction on microblogging platform Twitter, CoinDCX’s head of marketing, Ramalingam S., wrote on June 20 that “while some wallets are under maintenance there is a larger compliance requirement due to evolving regulatory needs resulting in increased scrutiny. The new process is being rolled out in phases, and it will reach all users in due course.” This company followed this up with a blog post on the same day, informing users that the exchange would release a policy in the next 14 days. Users say CoinDCX stopped crypto withdrawals abruptly sometime in May, without a compelling reason. It initially said the pause was due to “ an ongoing wallet maintenance service”. “They should have informed the user that they