Don’t Hold Kaspa on Exchanges! Expert Explains What KAS Holders Should Do After MEXC Refuses to Grant Withdrawal

Cryptocurrency traders were recently startled when the popular exchange MEXC suddenly refused to process withdrawal requests for some traders, with some even complaining on Twitter that their accounts were disabled. Among them was a Kaspa (KAS) holder. In response, Kaspa expert is advising investors not to store their coins on centralized exchanges to avoid similar issues in the future.

MEXC Withdrawal Freeze

The situation developed when Twitter user @rjnft99, known as ragzy.kas, attempted to withdraw KAS purchased on MEXC last week. Despite holding the required balance, ragzy.kas tweeted that MEXC “couldn’t withdraw it” and refused to release the funds.

With no other option to access his holdings, he was forced to sell at a loss, convert the proceeds to USDT stablecoin, and repurchase the KAS on a different exchange. “Get your $KAS out of MEXC!” he warned other investors.

Self-Custody Advice

Reacting to this incident, expert Jim (@Cryptographur) agreed that storing cryptocurrency on exchanges is risky. “You should only send $ to a CEX to buy and withdraw immediately,” he tweeted. “Holding coins on them could mean the difference between making money this coming cycle and losing it all.”

Jim also revealed that he personally lost Ethereum stored on the now-defunct exchange BTC-e back in 2017, proving that even popular trading platforms can unexpectedly block withdrawals without recourse.

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To avoid potential loss of funds, Jim and other Kaspa supporters strongly recommend that investors practice “self-custody” by holding their KAS and other cryptocurrency in private wallets they control. Although less convenient, controlling your own private keys eliminates reliance on intermediaries that can restrict access on a whim.

Takeaways For KAS Investors

While frustrating for traders caught unprepared, the MEXC incident highlights why self-custody is critical, especially for lesser-known assets like Kaspa. By quickly moving funds to personal wallets after purchasing, KAS holders can make sure their holdings are not trapped on an exchange due to technical issues, liquidity shortages, regulatory orders, or outright fraud.

As the case with MEXC shows, cryptocurrency exchanges are risky necessities rather than safe long-term stores of value. Heeding warnings from experts like Jim, the smart move for KAS investors is to take custody into their own hands. The minor inconvenience of self-storage pales compared to the alternative risk of losing access to holdings at the whim of a centralized third party.

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Temitope Olatunji
Temitope Olatunji

Temitope is a seasoned writer with over four years of experience. He specializes in Web3 and FinTech topics and enjoys creating content in these areas. He holds both a bachelor's and master's degree in Linguistics. When not writing, he trades forex and plays video games.

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