A while ago, someone asked me why selling U on top-tier exchanges often results in inexplicable account freezes and restrictions on bank accounts as well. In fact, the underlying logic is much more complex than most people think.

I’ve summarized the three most common scenarios in the market; you can match them to your situation.

**First: Your trading counterpart has issues with their identity**

This is the most covert type. Some scam groups may control a batch of exchange accounts through account hacking, acquisition, or impersonation. On the surface, these accounts are verified, with account holders named Wang Wu, but in reality, they are operated by scam groups.

You sell coins, and the other party pays. It appears to be a normal transaction, but the problem is: the money they transfer to you may originate from telecom fraud, pyramid schemes, or other illegal sources. Once the bank’s risk control system detects a connection between your account and such funds, it will immediately freeze the account. You can’t really argue because you can’t prove you don’t know who the other side is.

**Second: Contaminated fund chain**

This is even more hidden. Suppose your trading partner is a genuine crypto enthusiast, but they have previously received funds from unknown sources. Maybe they were misled into pyramid schemes, or they used funds recovered from victims of telecom scams. In short, they are a "primary source of contamination."

They transfer this money to you to buy coins, making you a "secondary source of contamination." The banking system will trace along this chain, and if multiple transfer levels are detected, all involved accounts face the risk of being frozen. This is called "related freezing" — not because you directly committed a crime, but because you are caught in a suspicious money chain at some link.

**Third: Buyer regrets and reports to authorities**

This one is particularly frustrating. Some newcomers are lured into opening accounts on exchanges with promises of quick profits, only to get caught in scam platforms. After being scammed, they realize they’ve been duped, but by then, it’s hard to say "who scammed me."

They might remember buying coins on a certain exchange, and coincidentally, the seller was you. So they report to the police, saying, "I was scammed after buying coins on this exchange." When the police investigate, they may target you — even if you’re not a scammer. They might know you didn’t scam them, but if they choose to list you as an "involved party" to reduce their own legal liability, your account gets frozen. No matter how much you explain "I was just selling normally," it’s useless.

**Why are these situations hard to prevent?**

The core reason is: exchanges and banks operate under a risk control logic of "prefer to be wrong in punishing than to miss." They cannot determine the true nature of each transaction in real-time, so once an account is flagged for high risk (fraud, pyramid schemes, abnormal funds flow), it gets frozen immediately. To unfreeze it, you usually need to provide a bunch of proof, which most people can’t produce.

So here are some tips for friends who want to sell coins on exchanges: First, avoid frequent large transactions and stay low-profile; second, choose reputable platforms with comprehensive risk control and customer support; third, if dealing with large sums, consider OTC trades or other channels, but only after thoroughly understanding the other party’s background.

The risks in the crypto world are never just price volatility; these hidden compliance traps are equally dangerous. Protecting your account and funds is more important than anything else.