OKX, the Seychelles-based cryptocurrency exchange, has refuted reports suggesting that it is being investigated by European regulators for failing to block Bybit hackers. OKX, which is subject to the European Union’s Markets in Crypto-Assets (MiCA) regulation, said the misinformation about its alleged failure to freeze funds associated with the hack stemmed from statements made by Bybit.

In a March 11 post on X, OKX said that after Bybit got hacked, it blocked the associated funds from moving into its centralized exchange platform. The crypto exchange also deployed a newly developed feature “to detect/block hackers’ addresses from using its DEX or wallet services.” The crypto exchange’s X post was in response to a Bloomberg report that claimed regulators are scrutinizing its custody wallet service.

According to the report, the suspected North Korean-backed hackers behind the Bybit hack had used the wallet service to launder $100 million in digital assets. The report relied on a summary of the movement of the stolen funds shared by Bybit CEO Ben Zhou on March 4. In that summary, Zhou said of the 40,233 ETH moved through the OKX Web3 proxy, only 16,680 ETH could be traced.

The Bybit CEO said the remaining 23,553 ETH was untraceable, meaning Bybit would have to obtain information on this from the OKX Web3 wallet. European regulators, who seemingly relied on this breakdown, have now zeroed in on OKX’s Web3 “proxy,” the report said. Some of these regulators have reportedly called on the European Securities and Markets Authority (ESMA) and the European Banking Authority to take action against OKX.

However, OKX insisted that its Web3 wallet services are no different from what rival crypto exchanges are offering. It also took aim at Bybit for spreading what it called false claims.

“We will continue to help Bybit to strengthen the industry. But we absolutely refute the false claims by Bybit that are leading to misinformation about our role in what began as a serious security vulnerability on their exchange,” OKX said.

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