New York Woman Sues Bittrex, Claims They Held Her Funds

A woman from New York has taken legal action against the crypto exchange Bittrex, accusing them of holding onto her funds, according to a report from industry news site The Block on June 30. The plaintiff says she put $120,000 into her Bittrex account back in August 2018, but they froze her account and didn't let her access her money until November this year. She also claims that the exchange tried to pressure her into signing a deal that would waive her rights to sue them, unless they released her funds. Bittrex is denying her claims, stating that she hasn’t shown proof of where the funds came from, which is a requirement under New York state and federal law. They argue that when she signed up, she agreed to their terms of service, which include a clause for arbitration. Reportedly, the clauses on the first page state that they handle certain disputes and she gives up her right to a jury trial or to join a class-action suit. Bittrex is looking to push for arbitration or move the case to a federal court in Seattle. The plaintiff hasn't replied to this request, and the court has approved it. The author of the report suggests that the plaintiff might not have much hope for a successful outcome. Recently, Cointelegraph mentioned that clients in various states in Brazil have also filed lawsuits against Bitcoin Bank Group for their issues accessing crypto funds. Additionally, there were reports in April about a former employee...

This bittrex TOS is too exaggerated, does it mean that US state and federal laws require people to declare the source of money even if it is $ 1? Is there not a limit of money that if passed must be declared the origin of money? how many bittrex clients have from the USA? will it be that bittrex asks all US customers to hand in the proof of the origin of the money even if they deposit $10 in bittrex? there are probably many US customers using bittrex. there should be a money limit that if exceeded the person should deliver the document proving the origin of the money.

I agree. They used to allow unverified accounts with limited withdrawal limits too, but things have completely changed since early 2017. Bitstamp and Bittrex are two exchanges I completely avoid because their customer due diligence is too burdensome and invasive.

Bittrex used to be one of the best exchanges there is within the market, but now they are just simply getting worse by the day. Unlike Binance, Bittrex is not forced by any regulatory pressure for it to behave the way it is right now, so they are basically just screwing customers over and trying to play the long game for people to just give up and hope that they end up with the users fund. Also, the proof of source of income they are asking on exchanges for additional KYC documents is simply too invasive, and is not necessary IMO because that's not their business to know where I'm getting the money from, it's just their job to accept it and let me trade. These kind of information should only be given to law enforcement if I end up screwing and made something illegal, not when I'm doing something for my own gain.

It has everything to do with regulatory pressure. A few years ago, everyone was using unverified accounts and withdrawing freely without regional restrictions. Basically overnight, unverified accounts were dropped to 0.025 BTC and 0 BTC daily withdrawal limits depending when the account was created. Then they're banning Iranians, Crimeans and others. Not long after that, they segregated US users from the rest of the world and pulled dozens of token markets from US investors, due to pressure from the SEC. Then came mandatory KYC for all users. Now, similar to Bitstamp, we're seeing increasing numbers of complaints about their enhanced due diligence policies. The list goes on. They're obviously reacting to pressure from the Treasury Department, SEC, FINCEN, possibly Homeland Security and others too. Bittrex seems to be turning into the next Bitstamp/Gemini -- quick to freeze or terminate accounts, overly invasive AML/KYC/CFT procedures, etc.

That is not correct. Bittrex has always had the intention to offer people actual fiat trading, but for that to happen they had to clean up their exchange and become compliant enough to do so. Abiding by government based regulations isn't enough because they also have to please their very demanding banking partner at the same time, so you can imagine how difficult it is not to do what Bittrex did. Could they be more transparent about the whole situation and handle things differently? Sure, but we shouldn't forget that it was an unregulated exchange not giving a shit for years. Going from shitcoin exchange to a professional platform requires some serious adjustments. They seem overly concerned to almost paranoid to not mess up somewhere in legal terms, but it unfortunately goes at cost of their users.

The USA side will be sold off at a discount within 24 months as their business goes to 0. Or they will just shut it down.

What is the situation with the exchange as i am having my funds in bittrex and i have verified everything what they asked and i cannot find the news what you are talking about here, is this a speculation that they will be selling off or is there any real substance as i cannot find any source for what you are saying. Even if they shut down they will allow users to withdraw the coins.

It's speculation but not one without merit. Between blocking US residents from buying certain coins/tokens, blocking US residents altogether and moving moving companies to new jurisdictions all the time, it would be unsurprising. If you're fully verified then withdrawing shouldn't be a problem.