Original / Odaily Planet Daily (@OdailyChina)
Author / Golem (@web 3_golem)
On the morning of August 13, the US stock token trading platform MyStonks announced that its 24-hour trading volume exceeded $97 million. According to CoinGecko data, MyStonks' 24-hour trading volume has surpassed Uniswap V2 on Ethereum, ranking in the top 25 of DEX 24-hour trading volume, which not only signifies the rapid expansion of the US stock token track but also marks MyStonks gradually taking the leading position in the US stock token trading platform field.
However, on the afternoon of August 13, a user posted on the X platform claiming that MyStonks had misappropriated the $6.2 million they deposited, closed the user withdrawal channel, and dispersed the funds. This incident quickly attracted public attention and raised concerns about the security of the MyStonks platform, even causing some users to panic and withdraw funds.
In response, MyStonks officials quickly responded, stating that this was due to a recent law enforcement request from US regulators regarding a single user, involving multiple special investigations such as anti-money laundering, fraud syndicates, drug trafficking, sanctions evasion, and suspicious activity reports (SAR), but it does not affect the deposit and withdrawal operations of other users; the platform's compliance department has contacted the involved user through secure channels and guided him to submit the relevant compliance information.
Furthermore, MyStonks officials have revealed that after the user posted a 'rights protection post', the website simultaneously received over 23 million DDoS attacks as well as a large number of complaints and reports. In response to user concerns and to better inform users about the entire event, MyStonks held a Space on the evening of August 13, where founder Bruce J provided a detailed explanation of the incident, directly addressing community concerns regarding security compliance, being identified by OKX as a phishing site, and other pressing issues, while also introducing future product plans of the platform. Odaily Planet summarized the key points of the Space as follows for readers' reference.
Response to the '$6.2 million' incident
Bruce J: The incident regarding the $6.2 million actually happened a week ago. I believe such incidents are normal in any cryptocurrency exchange.
Since we formed the team in 2024, we have consistently adhered to compliance. Therefore, among all US stock token platforms, our compliance procedures should be the most comprehensive, whether it is the MSB license from the US FinCEN (Financial Crimes Enforcement Network) or the SEC's registration for security token offerings (STO), all can prove this. Currently, our compliance team has personnel comparable to that of a traditional CEX, and they are all located in the US.
Regarding the issue of the $6.2 million withdrawal being blocked online in the past two days, we take this opportunity to explain the SEC's compliance requirements. Since last month, some addresses coming from mixers have gradually deposited to the MyStonks platform. Last week we received a law enforcement request from the authorities, but the specific content of the request cannot be disclosed to the market due to a confidentiality order. However, the content involved is generally similar to other exchanges, such as investigating whether users are involved in illegal activities, terrorist organizations, human trafficking, money laundering, and fraud, etc.
When we received the law enforcement request regarding this '$6.2 million' user, our compliance department contacted the user immediately. Upon contacting, we found that there were indeed many issues, and we received investigations from two countries regarding other addresses, indicating that this fund is indeed related to some addresses, which led to the public panic in the past two days.
We can also understand the voices on Twitter trying to attack us from the compliance and risk control perspective. As a new asset trading platform, especially one involving the highly regulated US stock trading platform, this is just some bumps we have to go through.
In the past 24 hours of public opinion fermentation, we completed over 400 withdrawals for users, and we place great importance on the security of each user's assets. We would never misappropriate any user's funds, including this user who was subjected to a law enforcement request, and we have communicated with him repeatedly. Moreover, two hours before this Space was held, our platform continuously faced network attacks, approximately 23 million times, but we have now fully recovered.
MyStonks places great importance on community public opinion and will actively respond to topics of concern. Regarding the single investigation by the regulators on this user, we will actively communicate with him to solve the problem together. Personally, I have been conducting mining business in the US for seven years; everyone knows me. We are not an anonymous team.
Community Questions
If this $6.2 million is identified as dirty money, how will the platform handle it subsequently?
Bruce J: First of all, we currently do not have 100% confirmation that this money is dirty money; even the regulatory authority has not stated that it is dirty money, they have only sent a targeted inquiry for a specific investigation. The regulatory letter mentioned investigations into anti-money laundering, cross-border fund flow, and suspicious trading activities, and we need the user to actively cooperate with these investigations, including his KYC information, fund flow information, address information, etc.
Currently, this real customer (not the user who posted on Twitter) has provided us with very limited information, so we are actively seeking this information from him. If we cannot obtain this information, our address and accounts will be temporarily frozen by the regulators. If the user cooperates with the investigation and we submit this information to the regulatory authority, then this matter can be resolved quickly; if the requirements of the regulatory authority are not met, we cannot determine when this money will be unfrozen.
Currently, OKX has already issued a warning that MyStonks is a phishing site; what is the reason for this? How long will it take to resolve this issue?
Bruce J: We are already in communication with OKX regarding this issue, mainly because they are cooperating with the online public opinion, and at the same time, a large number of attacks and reports against our platform have occurred in the past two days. We must admit that we are a bit caught off guard at the moment. The exposure of our account traffic on Twitter reached over 100,000 in a short time, and then OKX reported receiving a large number of complaints and reports against MyStonks, so OKX took action. The speed of the entire incident's development is particularly fast, but we believe the problem should be resolved soon.
As a result of this '$6.2 million', will the wallet addresses holding user funds also be regulated? Is the current withdrawal subsidized by the platform itself?
Bruce J: The platform has not subsidized user withdrawals. We have not pooled user funds; the freeze will only affect this specific amount, not all users' funds. We have been processing user withdrawals without encountering any issues. Since MyStonks was established, we now have about 20,000 users, handling roughly 500 to 800 deposits and withdrawals daily, with 99% having no issues.
I can only tell everyone again that this '$6.2 million' is just a targeted investigation against a single user, and the targeted investigation includes suspicious transaction reports related to trading account data, and it comes from legal documents from two governments. We hope to resolve this matter as soon as possible.
MyStonks recently launched US stock contract features, but the leverage itself is not high; is this related to regulation and compliance?
Bruce J: The leverage ratio is currently not directly related to compliance; it's just that our internal 'order book' is still under development; once it's fully ready, the leverage multiples will adjust accordingly, with different coins having different leverage ratios.
MyStonks' spot trading operates on an order flow model. When users buy and sell on the platform, we synchronize the trades through our US stock accounts, with a delay in milliseconds. The contract function will be fully implemented with an on-chain order book model in the future.
On August 13, users waited over 40 minutes for their deposits to be credited; what is the reason for this? Is it related to regulation?
Bruce J: This is not due to regulation; the main reason is that we have received a large number of DDoS attacks, so our entire team is currently on standby 24/7.
Normal user deposits are conducted on a peer-to-peer basis; as long as the on-chain confirmation is completed, the platform will display the funds as received. Coincidentally, due to this issue, I can reveal that MyStonks will cancel the deposit and withdrawal functions in the future. Because we are deploying new contracts, our contract audit is being performed by the largest auditing firm in the blockchain industry, and the first audit report has already been released, so a brand new DEX product will be launched this month, where users will no longer need to perform deposit and withdrawal operations, just connect their wallets to interact.
As a DEX product, it will also reduce more regulatory troubles and pressures.
Bruce J: Lastly, I want to add that MyStonks has not been smooth sailing since its establishment. In just half a year, we have accumulated over 20,000 users, with daily trading volume close to $100 million. During this process, we will accept market supervision and public scrutiny. As a platform, we will uphold our bottom line, ensure compliance, and cooperate with law enforcement requests.
The claim that our platform has misappropriated user funds is completely a rumor and malicious attack. After such statements surfaced, we still handled a large number of user withdrawal requests without any difficulties.
We will absolutely not run away. Through this incident, we have further recognized the importance of compliance and public relations. Therefore, if there are users still interested in MyStonks, whether in compliance or public relations, we welcome them with open arms and hope more excellent partners will join us.