- RCMP seized $40M from TradeOgre claiming illegal activity while users argue innocent holders are unfairly punished in the crackdown.
- Community backlash grows as users fear complex recovery processes and asset undervaluation similar to the BTC-e seizure in 2017.
- TradeOgre’s takedown marks the first Canadian exchange dismantled by law enforcement, raising concerns over user rights and regulation.
Canadian regulators have taken one of their boldest actions yet against crypto exchanges.
The Royal Canadian Mounted Police (RCMP) confirmed seizing $56 million CAD ($40.6 million) from TradeOgre, marking the largest crypto seizure in the nation’s history.
The platform, known for avoiding Know Your Customer (KYC) checks, has faced months of silence and sudden downtime, raising alarms among users. Authorities alleged that TradeOgre operated illegally and enabled criminal laundering.
The RCMP clarified that after receiving a tip from Europol, its money laundering unit started looking into TradeOgre in June 2024. The platform was therefore charged by investigators with not registering with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).
Moreover, the RCMP said TradeOgre did not require identity verification, making it attractive to criminal groups. Officials argued that the majority of funds came from illicit sources.
Community Backlash and User Concerns
Despite the RCMP’s claims, TradeOgre’s community strongly pushed back. Supporters accused authorities of punishing innocent users for the actions of criminals. Many highlighted that non-KYC platforms, both centralized and decentralized, exist widely and are not criminal by nature. Taylor Monahan, MetaMask’s security lead, said, “Sorry to contradict your ‘beliefs’ but last time I checked my friends and I are not criminals.”
Reuben Yap, co-founder of privacy-focused crypto Firo, also criticized the decision. He asked, “Are you just saying you can forfeit everyone’s balances because we didn’t KYC? That’s theft from many innocent users.” Users feared they may face a long and complex process to recover funds, similar to the U.S. government’s seizure of BTC-e in 2017.
Recovery Challenges Ahead
Yap warned that victims must provide “extensive onchain and offchain documentation” to prove ownership. Besides, claimants could lose assets if they miss deadlines or make errors. Additionally, seized assets are typically valued at the time of seizure. Hence, users could recover only a fraction of their crypto’s future worth, even if successful.
The first exchange to be shut down by Canadian authorities was TradeOgre, which rose to prominence by listing specialized coins with privacy concerns. The RCMP stated that their investigation is still ongoing as it examines transaction data and weighs charges.
