Turkish crypto traders file complaints after access to accounts frozen

Turkish cryptocurrency traders have filed thousands of criminal complaints against a trading platform after they were unable to access their accounts or withdraw their money there, a lawyer for the users said on Thursday.

The Thodex cryptocurrency trading platform posted a statement on its website on Thursday saying it would be closed for four to five days due to a sale process.

But users who have not been able to withdraw their money or access their accounts took to Twitter to voice concern that they may have been scammed, in comments widely picked up by Turkish media.

Thodex said on its website that “negative” media reports about the company were not true.

“Globally-renowned banks and funds, whose names we are going to announce when the agreement process is completed, have been wanting to invest in our company and proposed a partnership for a long time,” it said.

“For this process to be completed, transactions need to be halted and the sale process needs to be completed.”

The company could not be reached for comment on Thursday.

Last week Turkey banned the use of crypto assets for payments, adding to factors that sent Bitcoin down 14% at the weekend. Turkey’s central bank cited “irreparable” damages and transaction risks as reasons for the ban.

Lawyer Oguz Evren Kilic said he was contacted by users on Wednesday and that they had filed a criminal complaint on behalf of several people in Ankara. He said thousands of others had also filed complaints across the country.

“It is not clear where this is headed. There have been thousands of criminal complaints made in many places around Turkey,” he told Reuters, adding that the platform had 400,000 users, 391,000 of whom were active.

Kilic added that a preliminary assessment by police showed Thodex CEO Faruk Fatih Ozer had flown out of the country from Istanbul Airport on Tuesday afternoon.

Reuters was unable to reach Ozer for comment.

“We will file a case with the consumer court right away. The two processes – criminal complaints and the case – will run simultaneously,” Kilic said.

An Istanbul prosecutor’s office said it has launched an investigation into Thodex due to claims that the platform had led to the “aggrievement of many citizens.”

Users have claimed that Ozer may have taken their money used for trading on the platform with him when he left the country.

The 24-hour trading volume on Thodex was $538 million on its last trading day, according to Coinmarketcap.

Kilic said that the concerns that Thodex scammed users could have been prevented with regulation but that outright bans of the kind imposed by the central bank would not be a solution.

“We said in meetings with various government authorities that a digital asset law should be made and legal regulations should be created,” he said. “You cannot do anything with bans in this age.” [Reuters]