Indian crypto exchange Mudrex warned users of a temporary suspension of crypto withdrawals, the company said in a blog post.
“To enhance the security of our platform and protect it from bad actors, we have decided to temporarily suspend cryptocurrency withdrawals until 28 January 2025,” Mudrex said.
The exchange attributed the move to upgrades needed to meet regulatory requirements. The team assured users that functionality would be restored shortly after the update is completed.
Some community members reacted with scepticism.
Congratulations!
Mudrex disables Crypto Withdrawals!
Don’t tell me I didn’t tell you!
If you haven’t taken your money out yet, convert it into INR — withdraw into your bank and RUN! https://t.co/IjgOod2aRI
— VivanLive (@VivanLive) January 10, 2025
“Mudrex disables crypto withdrawals! Don’t tell me I didn’t tell you! If you haven’t withdrawn your money yet, convert it into INR, transfer it to your bank and run,” wrote X user going by VivanLive.
In response, co-founder Edul Patel said Mudrex is one of the few Indian exchanges with the option to withdraw crypto. The platform plans to preserve that status in the interest of a “holistic crypto-investing experience” for clients.
Patel stressed that INR withdrawals are still available and that all funds are safe.
VivanLive demanded the exchange provide proof of reserves:
“Why is there no transparency? Where is the proof of reserves? Prove your words with deeds! Don’t just talk.”
Before the restrictions were announced, the user had tried to draw the community’s attention to a number of ambiguous points in Mudrex’s transparency policy.
Now that I have your attention:
1. Mudrex has not published their proof of funds for forever.2. The founder has time to pay 30L+ for paid podcasts but says it takes time to ship such things.
3. No APIs are connected to track future volumes on Coingecko or Coinmarketcap. (it…
— VivanLive (@VivanLive) December 27, 2024
In late December he noted that Mudrex had never published proof of reserves and had not connected an API to track futures trading volumes. In his view, the exchange charges fees that are too high and spends excessively on marketing.
Two weeks before the announcement, after considering VivanLive’s arguments, another customer of the exchange, Aakash Athawasya, tried to withdraw his crypto assets.
I’ve been DCAing into @officialmudrex for the past year. It’s one of the only Indian crypto platforms that allow this.
To be fair, the platform worked fine.
There were no problems. And this post is not to label Mudrex as a scam or fraud. They’re not. They’re a business, an…
— Aakash Athawasya (@AakashAtha) January 11, 2025
Difficulties had already emerged — the platform had allegedly set a zero withdrawal limit and did not raise it despite the necessary procedures being completed.
“To be fair, the platform worked fine. There were no problems. This post is not to call Mudrex scammers — that is not the case. They are an unethical business,” Athawasya clarified.
The trader added that an exchange shutting off crypto withdrawals had probably simply never had reserves.
He urged users to withdraw funds from Mudrex and to warn users in India and Italy — another market where the platform operates.
“Listen to my advice (as someone who has lost a lot on Indian crypto platforms) — do not use Mudrex. Try to go directly to the blockchain,” the trader recommended.
From 12 January another crypto exchange — Bybit — suspended services in India. The team likewise cited new regulatory requirements and disclosed plans to register the platform as a virtual asset service provider.
In December 2024, the head of India’s central bank, Shaktikanta Das, said the state intended to reorganise the economy around a CBDC.