Poloniex Legacy Account KYC update stirs ire, withdrawals frozen for many

The US cryptocurrency exchange Poloniex implemented the KYC requirements for its legacy clients, but many were left unable to withdraw their funds, even after having themselves verified.

by Nina Dimitrova
28 May • 2 mins
In News

A recent update of the verification requirements for the legacy clients of the US cryptocurrency exchange Poloniex has stirred fury among its clients.

 

Irate legacy account holders have taken to the social media and the forums to voice their concerns and anger that their accounts have been frozen after successfully undergoing the newly required verification procedure.

 

Until recently, the holders of Poloniex legacy accounts were exempt from the requirement to provide personal and other information, in order to be able to use the exchange. It was introduced last December, with a major overhaul of Poloniex’s of its customer identification and verification systems. After it, legacy clients could still use the full functionality of the platform, but with a lower withdrawal limit of $2000 per day and the provision that at some point in the near future they will have to get themselves verified.

 

Last week the requirement kicked in, with an official announcement of Poloniex. We are asking all legacy Poloniex customers who have not provided full identification information in the past to do so now through the Poloniex profile page”, the exchange, which recently was acquired by the Goldman Sachs-owned financial services platform Circle, said.

 

However, as per numerous posts on Reddit, many legacy account holders had their withdrawal option frozen after undergoing the procedure. Eventually, some of them had their accounts unfrozen, after getting in touch with the Poloniex support.

 

In another Reddit thread and a YouTube video users lambaste Poloniex for breaking their promise about notifying their legacy clients in advance, before implementing the new requirements.

 

Indeed, back in December 2017, Poloniex said it will give an advance notice before the requirement goes into effect and even after locking the trading functionalities, the withdrawal option would remain open. But obviously Poloniex kicked in the mandatory KYC procedure for unverified legacy users, without giving a prior warning and disabled the withdrawal option.

 

They stated in their last update that there would be the choice to withdraw your funds if you didn’t want to continue using their service. They also stated that we would be told when it was happening, that the deadline would be announced”, one Reddit user, SilentRunning123, wrote. “Now they have randomly locked accounts, and are not allowing prior customers to access and withdraw their own funds. They are stealing peoples holdings, knowing that not everyone will be addressing this within the 2 weeks they have apparently given.”

 

At the time of writing of this article, Poloniex has yet to respond to those accusations. The latest announcement from the exchange is from May 27 and it does not address those issues. Instead, it concludes with the following: “Like all registered money services businesses, Poloniex is committed to compliance with all applicable law requiring identification and verification of its customers. If you have any further questions about the identity verification process and steps required, please reach out to our support team.”

 

Poloniex has been in business since 2014 and is one of the longest running US cryptocurrency exchanges. It offers around 100 coins and tokens that can be traded against BTC, ETH, XMR or USDT, but not against fiat currencies. This February the Goldman Sachs-backed mobile payments application Circle acquired Poloniex for an undisclosed sum.