MEXC Denies Insolvency Rumors, Faces Record Withdrawals as Users Seek Proof of Solvency

MEXC exchange has denied ongoing insolvency rumors after users reported withdrawal delays and increased fund outflows. The crypto exchange said it will update its Merkle tree data tonight to allow users to verify the reserves directly.

MEXC Outflows Surge to $5.5B Amid Liquidity Fears

The exchange issued a public statement reaffirming that all assets are “fully backed” and supported by Proof of Reserves (PoR) showing over 100% coverage. The clarification follows rising speculation on social media about MEXC’s liquidity, with some users claiming to have experienced slower transaction times.

In response, the platform said such claims were “false and misleading” and emphasized its “strong financial health.” However, data from CryptoQuant shows Bitcoin withdrawals on MEXC have surged to record highs.

The massive outflows is a reflection of mounting apprehension among traders. The visual data indicates large BTC, SOL, and ETH movements over the past 24 hours. Exchange reserve data by Coinglass shows MEXC holds around $5.13 billion in assets.

The platform saw $5.50 billion in outflows over the past 24 hours, the largest among its peers. Net outflows were also registered in KuCoin and Bitget but their amounts were significantly smaller compared to MEXC.

Analysts Doubt MEXC’s Transparency, Request for Independent Audit

The main question that market analysts and community members still pose is whether the PoR statement alone by MEXC is enough to regain user confidence. A financial transparency analyst, Shanaka Anslem Perera replied, “Evidence of solvency is no press release”.

He added that the crypto exchange should be able to show verifiable on-chain balances, evident liabilities, and perform external verification. Perera also emphasized that “withdrawals are the audit.” This means liquidity strength is tested only when users can freely withdraw assets without disruption.

Another crypto commentator, CookieSlap compared the current situation to the lead-up to the FTX collapse. However, the exchange’s restructuring team recently claimed that FTX was never bankrupt. They added that creditors are now set to receive their full repayment.

Still, crypto commentator argued that “PoR needs to be done by an unbiased third party with full access to all balance sheets.” StayCoti Node reminded holders to “review your positions” and maintain control over funds, warning, “They all say funds are safe, until they aren’t.”