Binance P2P Account Freeze - What to do Next (2024)

UPDATE: Recently Several High Court has Directed Banks to Not to freeze accounts on police request, just withhold disputed amount

I receive calls regarding account freeze because P2P transaction done to buy or sell USDT. lets understand what are the risk involve in P2P transactions.

if your account is Freeze then you can call me on 9729506771

Usually, how a Peer-To-Peer (P2P) transaction looks like?

Picture this: you’re a seller, and a buyer approaches you on a P2P marketplace. The buyer transfers money to your bank account, and in return, you release your crypto. Seems straightforward, right?

But here’s the twist—the buyer is a stranger, an enigma lurking in the digital shadows. You have no inkling of their intentions or background. Now, let’s delve into the cryptic underbelly of P2P transactions:

The Innocent Exchange

1. Scenario: You decide to sell $800 worth of USDT and connect with a seller named Suraj.
2. The Deal: Suraj transfers $800 to your bank account, and you release your crypto.
3. The Catch: You don’t know Suraj. Is he a regular trader or a digital outlaw?

Behind the Scenes: The Scammer’s Web

Suraj's Ruse:

• Suraj is a lottery ticket scammer.
• He dupes Radhika, claiming she won $200K.
• To claim her winnings, Radhika must transfer $800 to a bank account.

The Impersonation Game:

• Suraj has access to your bank details via P2P.
• He impersonates you, providing your bank information to Radhika.

The Unwitting Facilitator:

• Radhika transfers money to your bank account.
• You, innocently unaware, receive the funds.
• Following protocol, you transfer the $800 USDT to Suraj.

The Cyber Cell’s Intervention

The Freeze:

• Days later, your bank account is frozen.
• The cyber cell suspects your involvement in illegal activities.
• Panic sets in—what’s your recourse?

The Reality Check:

• You’re not part of any gang; you’re an unwitting pawn.
• The P2P transaction led you into a web of deception.

Decentralized Exchanges and Vigilance

Common Occurrence:

• Decentralized exchanges like KuCoin witness such scenarios.
• Scammers exploit P2P channels for financial crimes.

Protective Measures:

• Educate yourself.
• Verify counterparties.
• Report suspicious activity.

What is the Final situation

• You got the money.
• Suraj got the crypto.

What did Maria get?

• She got cheated.
• She files an online fraud complaint to the cyber cell, and boom!
• Your bank A/C is now frozen.
• Now you have to prove your innocence; but the reality is that Suraj scammed you and Radhika.

There have been a lot of such cases recently.

What are the ways to avoid these situations?

Binance posted an update addressing the same concern because many Binance p2p users accounts are frozen.

• Try to avoid doing P2P on decentralized exchanges, even avoid Indian exchanges like WazirX because, in their P2P marketplace, you can't find a single detail about the other person.
• Use centralized exchanges like Binance and Coinbase to carry out P2P transactions and check the other party's details.
• Always trade with a verified merchant on Binance who has a tick in front of their name.

Here's Binance's advice to their P2P users.

• Don't use your main A/C from P2P and try to have very few funds in your bank, so in case your accounts get a freeze, you don't land up in big trouble.

What if my account is frozen?

Not everyone can avoid this situation, so if your account gets frozen,

• You should contact the nearest cyber police dept. ASAP. and Email him about your case to request unfreeze, ( i can help you in drafting the letter)
• Contact with your bank's branch. and ask for Police officer Number (investigation officer) and Police Station Address from Where this Freeze is requested and Reference number / Acknowledgment Number of Freeze
• Contact your bank: Reach out to your bank’s customer service department or visit your local branch to understand the exact reason for the account freeze. This will help you in understanding in which state/city FIR is registered.
• Consult with Lawyer: The very basic and important step to start is talk to Cyber Crime Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 3,000 to 5,000. He is helping you in this situation of come out. He is expert in the domain and can help you explain which documents to give to Police and which not. A Good lawyer can get your account unhold amount or bank account in 7-10 Days.
• Cooperate with the Investigation: This is the most crucial step. Respond promptly to requests from law enforcement and provide all requested information. Demonstrating cooperation shows your willingness to assist the investigation. But i highly suggest to talk to lawyer before talking to Police, because police officer will call you to their police station to give some document and give statement, But later when you will reach police station will threaten to arrest you, Which will be complex situation to handle.

if you still need help you can contact me

Sudhir Rao (Qualified Advocate in India)

Contact - 9729506771 (WhatsApp)