Kraken User on Reddit Accuses Exchange for Closing a $312,000 Account: Unfortunate Happenstance or Smear Campaign?


A user on Reddit, Rob768, made a post today that was titled, “$312,000 Kraken Account being Close – I'm being forced to Buy Bitcoin with the Cash Within 24 hours.”

In his post, he describes how his account has been active for three years with “millions in transactions,” never having a problem until now. Backing up his own validity, he states that his account is verified “up all the tiers,” and that he hasn’t done any unsavory business with the account.

According to his narrative, he attempted to withdraw $200,000 in cash, which would be over half of what he says his account holds. As a result, Kraken contacted the user for additional tax returns as “proof of funds,” even though “the money was earned 8 years ago,” and he admits that it wouldn’t show this proof. He adds at this point that he has already withdrawn $700,000 over the years.

The provided information elicited an email from Kraken, saying that he will need to withdraw his 4 BTC, along with the $290,000 he holds in cash, which will have to be done with a purchase of bitcoin.

The user then provides a copied version of an email he received, rather than a screenshot that would hold more validity. Still, he said he posted the content “as proof.” The alleged email says:

“Thank you for contacting Kraken.

Unfortunately, for security purposes, we cannot disclose the reason for this action. We apologize for this inconvenience.

Please withdraw your current within the next 24 hours (from the time and date of this message). Additionally, we are requesting that the funds be converted to cryptocurrency and the balance withdrawn that way.

After the 24 hours have passed, your account will be closed.

If you have any questions, please do not hesitate to respond to this message. Thank you.

Best Regards,WarrenKraken Client Engagement Team.”

While this would be a quick way to get the public to rally against Kraken, if they believe the story, user BashCo made sure to encourage users to hear out more than one perspective. The moderator of multiple crypto-related Reddit channels, including Bitcoin, BlockChain, GRIN, BitcoinWiki, and others, stated,

“There may be some indication the [original poster] has not been 100% honest here. However, the account was fully suspended by reddit admins before this thread was posted, so the profile cannot be reviewed for further information. Mods approved the thread manually based on the apparent urgency of the matter. Please refrain from posting private information.”

Then, the CEO of Kraken himself, Jesse Powell, responded from his verified Reddit account. About seven hours after this post went live, and one hour after BashCo’s comment, he stated,

“I presume you know (the real reason) why the bank is no longer willing to process fiat payments for you, and why Kraken has to close your account. The recommendation is to withdraw your funds in crypto before they are frozen indefinitely. Of course, you don’t have to buy crypto with your fiat, or even withdraw it. We can’t guarantee a timely return of your fiat if you choose to leave it in your account at the time of closure.”

Though there are still commenters that want to bring the attention to themselves, Rob768 chimes in and says, “No I do not. Kraken refuses to give me a reason.” It is almost as if he doesn’t understand that Powell has answered, not a random critic. Further comments suggest that the user is actually a scammer in his own right, while another simply states, in less eloquent words, that he was most likely using his funds illegally.

Regardless of the outcome or the opinion of readers, it looks like the Kraken CEO has all bases covered, and the mysterious Reddit user needs to move their cash quickly.

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