WEX

DESCRIPTION OF EVENTS

"Wex, once the largest crypto trading platform in the Russian-speaking world, was launched in the fall of 2017 as a successor of BTC-e." "As a result of the investigation and seizure of the domain, the FBI came into possession of nearly 38% of all Cryptocurrencies and fiat stored on the exchange." "btc-e and later wex.nz were a core foundation for bitcoin, litecoin and others the market was built on the shoulders of man and women who traded there."

"In response to this, those behind BTC-e launched another exchange and rebranded themselves as Wex.nz, promising to repay any customers who had lost funds from the seizure. Wex.nz was a 1:1 copy of the previous BTC-e site and sought to pick up where the old BTC-e platform left off." "The individuals running both BTC-e and WEX have always maintained anonymity, talking to the users under pseudonyms in the exchange’s trollboxes and on the Bitcointalk forum."

"CEO Dmitry Vasiliev says, that the team changed from the beginning of this year, and this was the time, when he was pushed away from the management. When former BTC-e crushed, Dmitry Vasiliev, who at that time was one of the biggest BTC-e client (he bought BTC and sold them in China in a big amount) got in touch with the 'red admin' (who is one of the reliable persons as we could see from further events, he talked not much but always kept promises, which entailed the love and respect of users) and agreed to restore the exchange with main aim to cover users' losses with inner tokens to be redeemed ASAP..."

"Then as was said at the beginning of 2018, a new group of people appeared at the scene with Khavchenko aka "Moryachok"." "Dmitry Vasiliev says, that he is in shock how the new team crushed the WEX platform, as it is a business with 5-10 million USD of clear income per month. He states that he is absolutely confident that WEX will come to its normal, now he says all problems result from the internal conflict."

"[B]y [M]arch 2018 "Moryachok" forced Dmitry Vasiliev to sign documents for the transfer of management rights. By that time, Dmitry Vasiliev wanted this action to be paid as he put money, efforts and a lot of time to rebrand former BTC-e to WEX. And that’s why this process dragged on. Further later, while the process of sale was pending and because of uncertainty, the 'red admin' blocked the cryptos and said, he would give access when everything would be settled down. Now, as the situation came out of control, Dmitry Vasiliev is ready “even to pay by himself to get rid of connection to WEX” by his words, as he is afraid of problems and prosecution, and only he is the official CEO and must be responsible. He says he got even plenty of death threats from users. “Some Russian users are more loyal and react adequately to the situation, but how can I explain all this to for example the Thai people or foreigners? They have no idea what’s going on and they will persecute me and never fall behind.”"

"Withdrawals are disabled for most coins for a few months, there are some coins that are available for withdraw but the prices are for example 1 ZEC is worth 1354.77USD atm while on other exchanges it is traded at the price of 128-130USD." "Wex support were answering tickets, although they had a mostly generic answer in them in the lines of "Wait for official news", in the past weeks support stopped answering." "Some of us have 5 digit $ stuck inside there and we have been w[a]iting for 5 months with no of[f]icial news."

"According to the Russian business news portal RBC, Wex had reached a daily turnover of $80 million before it went offline. In 2018, its operator, the Singapore-based entity World Exchange Services, was sold to Dmitry Havchenko, an entrepreneur from Kyiv turned separatist fighter in Eastern Ukraine. While Dmitry Vasiliev was the company’s official owner, BBC claims Wex actually belonged to Aleksey Bilyuchenko, Vinnik’s partner at BTC-e."

"After being in and out of service for months, during which it also changed its web address several times, Wex halted withdrawals in the summer of 2018 and later went bankrupt." "After only a year of operation, Wex.nz lost many of its domain names and proceeded to disable withdrawals before shutting down completely. Unfortunately, this shutdown once again left many investors without access to their funds."

"As the price tumbles down for Crypto just before Christmas and the death of wex.nz it is safe to acknowledge that these are the last gasps of Crypto in the world, it sure was a fun ride, but as always in any god thing and revolutionary in the world it is the community that kills it in no time. Indeed this is going to be a Black Friday for many Crypto owners."

"According to CoinDesk, Binance captured 2 accounts that received more than 93k ETH from wallets linked to one of the oldest exchanges online WEX, which previously was named btc-e." "An estimated 93,000 ETH (appr. $18 million) may be at risk – as these funds have been moved to Binance. There might also be more user funds that could potentially be stolen as WEX’s users have been unable to withdraw most of the crypto assets from the exchange." "Apparently that happen[ned] after a Twitter post by a user named John James @RedDragon__ with the words: Also another interesting twist. Wex cold wallets are moving funds through @binance . Meaning Binance is potentially help launder millions of dollars worth of stolen funds from Wex users. We have proof too."

"Binance responded with: The identified accounts are frozen, please report to law enforcement and have a case number. We will work with LE. This is part of centralization we hate too, dealing with other exchange's mess (we don't even know the details). But we will do what we can." "Commenting on the situation, Binance PR representative, Leah Li said:"

"[We are] not familiar with the specific situation at WEX, [however], we always investigate user claims thoroughly and we will suspend account access if any unusual activity is detected. We are [also] encouraging users who may be impacted to file reports with local law enforcement and ask them to send us case numbers or official notices/letters of investigation. So far, we haven't been provided with any notices yet."

"The agreement on the transfer of ownership of the WEX cryptocurrency exchange (former BTC-e) with DPR supporter Dmitry Moryachk Khavchenko was signed on July 21. The deal has entered its final stage. This was found out by the investors of the site during an impromptu webinar with the nominal director of the exchange Dmitry Vasiliev (the audio recording is at the disposal of ForkLog)."

"[I]n July 2018, due to "technical work", the WEX exchange stopped full withdrawal of funds. At the same time, according to Dmitry Vasilyev, an agreement was signed on the transfer of ownership of WEX to ex-DPR militant Dmitry "Moryachk" Khavchenko."

“When there was a handover, I knew the amount of user balances, and when BTC-e traders were offered to return 62% of funds in cryptocurrency and 38% in the form of debt tokens with subsequent redemption, 62 - it was right at the maximum. But there are a lot of blocked funds, someone has lost, someone is afraid. Now the support is generally gesticulating, as I understand it, there is such nonsense about blocking accounts, there have been complaints. But the exchange must have money and cryptocurrency in access, ”concluded Vasiliev, adding that the cash gap on the exchange happened due to the fact that there were many unsecured WEX codes on the market.

"According to Bilyuchenko’s police statements, in the summer of 2018, right before WEX collapsed, he was in talks with Malofeev, who wanted to obtain the database of the WEX users, presumed to be for a new crypto exchange named Vladex, the BBC says. Malofeev has previously denied links to WEX to the BBC, and would not comment for the latest report saying it was “based on fabricated materials,” the broadcaster says."

"According to an audio tape from the investigation, also obtained by the BBC and reportedly verified by audiovisual forensics experts, Malofeev, who is known to be close to the Kremlin, wanted to open a government-friendly exchange and was pressing Bilyuchenko to hand the users data over to Vladex via a former FSB officer the report says is “probably” Anton Nemkin."

"Via a representative, Nemkin denied any links to Bilyuchenko or his business activities, the BBC said, though he is linked publicly to Vladex."

"Bilyuchenko also told police that two current FSB officers, named Igor and Grigori, made him give away the flash drives holding all the cryptocurrency of WEX users and transfer it to their wallets — asset worth about $450 million, he said. Bilyuchenko said he met the officers several times in 2018 in the FSB building and Lotte hotel in the center of Moscow."

"Neither the Russian police nor the FSB would comment on the matter when asked by the BBC."

"In August of the same year, it became known about the bankruptcy of the exchange and the suspension of its work. An initiative group of clients of the exchange calculated that the damage exceeded $ 400 million. Personally, Vasiliev is credited with the withdrawal of $ 200 million." "According to estimates by a group of Wex users quoted by Forklog, total losses exceed $400 million with Vasiliev himself suspected of withdrawing $200 million. He is wanted in Kazakhstan after a trader from Almaty turned to local law enforcement accusing him of stealing $20,000 worth of funds through Wex."

"At this point, Alexei Bilyuchenko, the ex-tech administrator of BTC-e and co-founder of Wex, was arrested in Russia as part of a criminal investigation by Russian authorities. The investigation stemmed from numerous complaints filed in Russia and Kazakhstan that millions of dollars worth of cryptocurrency were leaving Wex wallets between July and October of 2018."

"WARSAW, September 20 - RIA Novosti. In Warsaw, the former head of the WEX cryptocurrency exchange, Russian Dmitry Vasilyev, was detained, a representative of the city's District Prosecutor's Office told RIA Novosti." "Earlier it became known that Vasilyev was suspected of involvement in the disappearance of $ 450 million belonging to investors from the European Union and other countries." "[A]s authorities officially confirmed that Vasiliev was in custody, $30 million in ether (ETH) started moving out of a wallet associated with WEX."

"However, it appears that the actual handling of the funds could be problematic for those in control. On a 9,916 ether transaction, valued at $29.7 million as of the time of wriitng, whoever initiated the transaction ordered a max cost of 0.00042 ETH and a gas price of 20 Gwei."

"Gas — or the cost of transacting — has not been that low in months, with the result that the transaction has been pending for about 24 hours, as of publication time, and doesn't seem likely to move forward soon."

"In Russia, the case against him at the request of the clients of the WEX exchange was opened in November 2018."

"According to the report, 100 ETH have been recently withdrawn from a wallet belonging to Wex that has a remaining balance of over 9,900 ETH."

"[R]umors of Vasiliev’s detention have been circulating among Wex’s clients since August and a close acquaintance of his has confirmed to the BBC that he was indeed in Polish custody."

"Dmitry Vasiliev, former chief executive of Russian cryptocurrency exchange Wex, has been detained in Warsaw, the Polish press reported. Vasiliev is wanted in Kazakhstan where he is accused of fraud related to the now defunct trading platform, successor of the infamous BTC-e exchange."

The WEX (World Exchange) platform was a cryptocurrency trading platform designed as a successor to the BTC-e exchange, which promised to return the funds of users of BTC-e (previously seized by law enforcement). After changing domains multiple times, the platform underwent a change of ownership and ultimately stopped honouring withdrawals within a year of founding and disappeared. As far as can be told, all affected users have never recovered any of their funds.

HOW COULD THIS HAVE BEEN PREVENTED?

BTC-e could have been prevented from becoming a dominant exchange with a proper regulatory framework to begin with.

The situation at WEX could have been prevented by a more organized take-over of the BTC-e platform. Rather than seizing the banking funds of people all across the globe at the earliest opportunity, continuing to track and take down the operators of BTC-e would have allowed to identify and compel the cooperation the management. The platform could have been transitioned to a new management team and brought into compliance without having to result in staggering losses.

While placed in a challenging position due to the actions of regulators, the primary reason that the WEX exchange itself failed was a lack of organized oversight of the remaining funds. The WEX exchange transferred from one individual owner to another, first from Alexander Vinnick to Dmitry Vasiliev to "Moryachok". It never had a proper multi-signature wallet set up to manage the client funds.

Even absent the cooperation of regulators, numerous options exist in this situation to continue operation with transparency despite the partial reserves, most notably limiting withdrawal amounts of past funds held or finding investors/lenders to cover withdrawals temporarily. The platform was highly profitable with $80m in daily turnover, and could have crawled out of this situation had the team simply managed what they had and continued to increase the backing over time. Instead, WEX was run by a single individual who appears to have had no interest in seeing a proper ending. Withdrawals were completely blocked on almost all coins, the exchange lost function over time, and the remaining funds were instead attempted to be laundered through Binance as the final closing gesture.

Check Our Framework For Safe Secure Exchange Platforms

FBICO? BTC-e Considers Debt Tokens and ICO to Repay Users (Mar 8)
https://www.bbc.com/news/world-europe-50821547 (Dec 12)
WEX Exchange – reviews, info, feedback (wex.fit) (Dec 28)
Ethereum Transaction Hash (Txhash) Details | Etherscan (Dec 28)
Средства на счетах биткоин-биржи WEX пришли в движение | ForkLog (Dec 28)
Дмитрий Васильев: биткоин-биржа WEX продана стороннику «ДНР» Морячку (аудио) | ForkLog (Dec 28)
Telegram: Contact @rospres (Dec 28)
$30M in ETH on the move after authorities confirm arrest of WEX exchange founder (Dec 28)
В Польше заявили о задержании россиянина по запросу Казахстана - РИА Новости, 20.09.2021 (Dec 28)
What Happened To BTC-e.com (and Wex.nz)? – Crypto Asset Recovery (Dec 12)
Criminal Case Against Failed WEX Crypto Exchange Points at Russian Law Enforcement - News Alt Coins (Dec 28)
@WEXnz Twitter (Dec 28)
WEX Official (@WEXnz) | Twitter (Dec 28)
Биржа WEX (Dec 28)
BTC withdrawals are disabled. : wex (Dec 28)
Is DSH in WEX the same as DASH in Bittrex? : wex (Jun 29)
WEX.nz support scam Warning!!! : wex (Jun 29)
when will this end?! : wex (Jun 29)
Withdraw will be resume after 22 July 2018 according to the tweet : wex (Jun 29)
WeX.. : wex (Jun 29)
"Consumer advisory - WORLD EXCHANGE SERVICES PTE. LTD (reg. nr. 179433) the holder of WORLD EXCHANGE SERVICES stored value facility, does not require the approval of the Monetary Authority of Singapore." What does this mean? : wex (Jun 29)
Cheapest way to withdraw? : wex (Jun 30)
WEX finally enabled XMR withdrawels at a limit of 1000 XMR/day : wex (Jun 30)
wex.nz updates : wex (Jun 30)
$18 Million: Binance Freezes Crypto Accounts ‘Indirectly Linked’ to Troubled Russian Exchange, WEX | Cryptoglobe (Jun 30)
Website offline : wex (Jun 30)
New Wex URL - wex.fit : wex (Jun 30)
Hacked - account depleted : wex (Jun 30)
wex has moved again to a new .in address : wex (Jun 30)
New Domains : wex (Jun 30)
Any credibility in this? : wex (Jun 30)
Can someone please bring some clearness into who ran what exchange and how things like that are even possible? : wex (Jun 30)
What happened to my account and the website? : wex (Jun 30)
Wex gave me death threats and sent people to try to kill me : wex (Jun 30)
https://wex-scam.com/confirmation-of-russian-police-investigation/ (Jun 30)
message on wex.ink : wex (Jun 30)
Status of WEX (World Exchange Services) (Jun 30)
Contact WEX and demand your funds. : wex (Jun 30)
ANY NEWS? Most People are patiently Waiting. : wex (Jun 30)
What is This ? : wex (Jun 30)
I am in : wex (Jun 30)
All is not lost : wex (Jun 30)
Release Him So He Can Release Our Money ! : wex (Jun 30)
Wex.nz/Btc-e updates ? Action ? : wex (Jun 30)
Ex-CEO of Crypto Exchange WEX Arrested In Italy : wex (Jun 30)
Sergey Mayzus: money from the WEX bitcoin exchange may have been laundered through Neklis-Bank of Natalia Kaspersky : wex (Jun 30)
BTC-e recovery from my private key and my base32 private key? : wex (Jun 30)
Btc-e : wex (Jun 30)
Did anyone else receive a mail from Cex.io? : wex (Jun 30)
https://wexcodes.com/ (Jun 30)
Just received email from wexcodes.com : wex (Jun 30)

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