Exchange won't let me withdraw: lawful grounds and what to do about them

When a platform may lawfully hold your funds

The user agreements of every major exchange allow withdrawals to be suspended in four situations: an active compliance review, an order from a competent authority, a technical pause, and suspected compromise of the account. In all four the platform also carries an obligation: to conduct that review within a reasonable time, not indefinitely.

When it becomes a breach

• The review has run for months with no requests put to you — the "reasonable time" has expired.
• You answered the request and the platform has gone silent without asking anything further.
• The platform closed the account but will not release the remaining balance.
• Support cites "internal policy" without pointing to any legal basis.

The claims route

1. A pre-action letter of claim to the legal entity serving your region (it is named in the agreement), requiring it either to complete the review or to state the legal basis for the hold.
2. A complaint to the regulator that licenses that entity: licensed platforms are subject to statutory deadlines for responding to complaints.
3. Court or arbitration, according to the clause in the agreement. An expensive route, justified only where the sum is a multiple of the costs; in practice it is rarely reached, because a well-drafted claim resolves most cases.

If your case concerns a specific platform, see the individual guides: Binance, Coinbase, Kraken, Bybit, OKX.

The legal grounds, in contract terms

Every claim against an exchange starts in its user agreement. The clauses that decide your case are the suspension-of-services clause (what the platform may lawfully do and for how long), the governing-law clause (which country’s contract law applies) and the dispute-resolution clause — many major platforms route disputes to institutional arbitration rather than local courts, and the seat of that arbitration determines cost, timeline and available remedies. Where the platform serves consumers in a regulated market, an ombudsman scheme (for example the UK’s Financial Ombudsman Service for FCA-regulated firms) can be a faster and cheaper route than either.

Two instruments are consistently underused. A properly addressed letter before action (a “demand letter” in US practice) triggers pre-action obligations and starts the clock on the “reasonable time” argument. And a data subject access request (DSAR) under GDPR or equivalent law can compel the platform to disclose what it holds about the freeze decision — often the only lawful way to learn the real reason before proceedings. In urgent cases, courts can grant interim relief such as a freezing injunction over the assets while the merits are argued.

The clause everyone skips is the governing law and dispute resolution section of the user agreement — most people read the arbitration clause for the first time only after we point them to it. It matters because it tells you where a claim actually has to be filed and what the pre-action requirements are; skipping straight to a complaint on social media wastes the leverage a properly addressed letter of claim gives you.

Mark Eichorn · Managing Partner