FTX Blocks Aztec Connect Protocol User Accounts

FTX Blocks Aztec Connect Protocol User Accounts

Following the blocking of Tornado Cash, privacy protocols came under scrutiny, interacting with which could cost users account suspension.

Chinese journalist Colin Wu reported that the FTX exchange blocked user accounts for transferring funds to a ZK Money account. Wu wrote on Twitter that FTX "identifies Aztec Network as a mixing service" and strongly advises its customers not to use the services of this service in order to avoid account suspension.

Aztec Network representatives said they are aware of ongoing developments and intend to contact FTX, as well as "negotiate with global regulators, centralized exchanges and consumers." The protocol team also said that it has taken additional measures to prevent money laundering, including slowing down the speed of deposits and withdrawals of funds, and also simplified the identification of addresses at potential risk.

The exchange has yet to issue an official statement on reports of account freezes, but FTX CEO Sam Bankman-Fried responded on Twitter, suggesting the information may have been misrepresented.

“We are constantly reviewing transactions for compliance with AML rules and conducting enhanced due diligence on certain transactions, but this does not mean that any accounts have been frozen,” he wrote.

Yesterday, the US Federal Deposit Insurance Corporation (FDIC) demanded that the FTX.US exchange stop making misleading statements about supposedly insured cryptocurrency products.

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