OKX has temporarily suspended its Web3 decentralized exchange (DEX) aggregator following discussions with European regulators.
The exchange announced this decision on March 17, stating that the move is part of efforts to enhance security measures and prevent misuse of its platform.
Bybit hack connection
The suspension comes as European authorities investigate allegations that hackers linked to North Korea’s Lazarus Group used OKX Web3 to launder funds stolen in the recent Bybit hack.
A recent Bloomberg report suggested regulators from all 27 European Union nations discussed this issue during a European Securities and Markets Authority (ESMA) meeting on March 6.
Bybit CEO Ben Zhou confirmed that the hackers leveraged OKX Web3 to launder approximately $100 million of the stolen $1.5 billion.
In response, EU regulators are now assessing whether the platform falls under the jurisdiction of the Markets in Crypto-Assets (MiCA) regulatory framework and exploring possible penalties for OKX.
OKX’s response
OKX maintains that its involvement in the laundering process was due to incorrect labeling by blockchain explorers and other decentralized exchanges.
The exchange stated that it is actively working with these explorers to ensure accurate transaction reporting and prevent misidentification of its aggregator as the point of trade.
It explained:
“We know that transparency is key, so we’re also working closely with blockchain explorers to correct incomplete labeling. Our goal is to ensure that explorers properly highlight the actual DEX processing trades rather than mistakenly identifying our aggregator as the point of trade.”
The platform also reiterated that its aggregator does not custody user assets but merely provides access to liquidity across multiple decentralized protocols.
To further strengthen security, the platform has introduced a system designed to detect hacker addresses in real time and block them from accessing its centralized exchange.
OKX CEO Star Xu said on X:
“We already rolled out a lot of controls for OKX Web3 to fight with the misuse including prohibited markets’ ip blocking and real-time black address detection and blocking system.”
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