OKX CEO reiterates accounts interacting with sanctioned entities will be blocked following influencer complaint

OKX will terminate user accounts found to be engaging with “sanctioned entities” — such as Tornado Cash and Garantex — its CEO, Star Xu, reiterated today in response to a user’s public call to avoid using the exchange.

Xu wrote in an X post that user accounts depositing funds from sanctioned entities or withdrawing funds from OKX to sanctioned entities will “trigger compliance risk controls, leading to the closure of the account.” Xu specified Russian exchange Garantex and crypto mixer Tornado Cash as examples of sanctioned entities.

Xu’s statement came after user Satoshi Friends told his followers on X that users from the Commonwealth of Independent States may “risk facing sudden blocking of their accounts, freezing of funds and loss of any assets.”

“My account has been blocked, as well as the referral base accumulated over many years," Satoshi Friends wrote, adding: "Influencers recommending the OKX exchange may incur not only financial but also reputational risks."

In response, Xu said in a separate post that Satoshi Friends had “a couple of significant transactions related with sanctioned exchanges or DeFi protocols,” which led OKX to discontinue services for the user.

“We allowed you to withdraw your clean funds before we blocked the account," Xu wrote in the post to Satoshi Friends. "You requested to set up a new account and transfer your data from the old account to the new account. We really can’t do it because it is a kind of bypass [of] our compliance policy.”

The Block reached out to OKX and Satoshi Friends for further comment.

Tornado Cash is a controversial crypto mixer that's deemed problematic or illegal by various regulators. It helps obfuscate the movement of cryptocurrencies, making it more difficult for law enforcement to trace illicit funds. 

Earlier this week, blockchain security firm PeckShield found that an address associated with the exploitation of Nomad Bridge transferred 14,500 ether ($35.2 million) of the stolen cryptocurrency to Tornado Cash.

Tornado Cash developer Alexey Pertsev was denied bail in the Netherlands earlier this month after being sentenced to five years and four months in prison on charges of money laundering.