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Circle warns Poloniex customers in the U.S. of assets conversion to USDC

Circle warns Poloniex customers in the U.S. of assets conversion to USDC

Crypto conglomerate Circle warned all U.S.-based Poloniex customers to withdraw their assets before Dec. 16. Users who fail to withdraw their assets before the deadline could lose access to their account, have their assets traded to USDC or be charged service fees.

Poloniex and Circle part ways at the expense of their users

Circle, a global blockchain finance company, is finalizing the process of parting ways with the Poloniex crypto exchange. In an announcement, the company said it may begin charging fees to Poloniex customers in the U.S.

According to the company’s Medium post, all U.S. Poloniex customers must withdraw all of their assets before the Dec. 16 deadline. Those who fail to withdraw their funds could lose direct access to their Poloniex U.S. accounts or have the assets in their accounts traded into and stored as USDC.

Apart from that, some users could be charged a monthly service fee and a one-time dormancy fee. The company noted that users will not be charged more than their total account balance.

Crypto community calls out Circle’s questionable practice

Circle’s struggles with Poloniex have been the subject of many reports since it acquired the exchange in 2018. After an attempt to revitalize Poloniex by moving its operations to Bermuda, the two companies finally decided to part ways and announced the separation in October.

Despite ending trading for U.S. Poloniex customers on Nov. 1 and announcing the Dec. 16 withdrawal deadline, Circle provided no details on the repercussions its clients would face.

Circle’s Twitter announcement received overly negative feedback, with many users criticizing the condescending tone of the company’s announcement.

Multiple users complained about their accounts being frozen despite being high-tier verified accounts. Others were more worried about the prospect of having their funds converted to USDC. Having a huge amount of assets sold for Circle’s stablecoin has the potential to crash a lot of illiquid markets, users warned, with some even questioning the legality of Circle’s request.

Posted In: , Crypto Exchanges, Regulation, Trading
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Priyeshu Garg
Author

Priyeshu Garg

Crypto Analyst @ CryptoSlate

Priyeshu is a software engineer who is passionate about machine learning and blockchain technology. He holds an engineering degree in computer science engineering and is a passionate economist. He built his first digital marketing startup when he was a teenager, and worked with multiple Fortune 500 companies along with smaller firms. When he is not solving transportation problems at his company (Ola), he can be found writing about the blockchain or roller skating with his friends.

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