Breaking the "Frozen Card" Dilemma: A Comparison of the "Frozen Compensation" Mechanisms of Three Major Exchanges

Deng Tong, Golden Finance

Since the rise of C2C trading, "frozen cards" have always been one of the biggest pain points for users in cryptocurrency trading. As more and more ordinary users enter the cryptocurrency trading space, "frozen compensation" is no longer an added benefit, but rather a "standard feature" of cryptocurrency trading platforms.

1. Comparison of the "Compensation Mechanism" of the Three Major Exchanges

1.OKX C2C****Frozen Compensation Mechanism Overview

On August 27, OKX C2C officially launched the "Frozen Compensation" system. The two core advantages of OKX, "Maximum Compensation of 100%" and "Zero Fees," not only maximally protect the rights and interests of investors but also set a new compensation standard for the cryptocurrency industry.

OKX dares to promise users: if their receiving account is frozen due to merchant payment, eligible users can receive corresponding financial compensation according to platform rules: up to 100% compensation ratio, with a single compensation limit of up to 30,000 USDT.

OKX promises that all C2C trading orders will not incur any transaction fees. Regardless of the order amount, both users and merchants are exempt from fees.**

OKX has also selected merchants with the "Frozen Compensation" label through a multi-dimensional evaluation. These merchants must meet additional criteria, reflecting OKX's high selection standards for user responsibility. Specific details include: paying a deposit of no less than 30,000 USDT; being a certified merchant for at least 180 days and serving no less than 3,000 users; no valid complaints due to payment-related abnormalities in user collection accounts in the last 90 days, etc.

2. Comparison of the “Frozen Compensation” Mechanisms of the Three Major Exchanges

Binance, Huobi, and OKX have successively launched their own "frozen compensation" mechanisms, but each mechanism has its own strengths and weaknesses.

First of all, there are significant differences in the compensation ratios among various platforms: from no compensation at all to 10%, 20%, 50%, and 100%.

It can be seen that, whether from the perspective of the compensation ratio or the maximum compensation limit, OKX's "frozen compensation" mechanism is the most sincere.

Secondly, the sources of the compensation funds vary among different companies.

With platform funds as the fundamental support, it can maximally ensure users' compensation rights and relieve users of concerns regarding claims. Leading exchanges genuinely start from user needs, using a model where both the "platform" and "merchants" jointly compensate, which helps users avoid compensation risks—users do not have to worry about merchants running out of their deposits and not receiving compensation.

Finally, in terms of transaction fees, OKX and Huobi's C2C trading do not charge any fees. In contrast, Binance's C2C trading requires merchants and users to pay corresponding fees depending on the situation. This means that users who choose to deposit or withdraw on Binance may face potential fees, and the frozen compensation ratio and limits do not have an advantage compared to other platforms.

In summary, although the leading exchanges in the industry have all launched a "frozen compensation" mechanism, after comparing the three major exchanges, OKX C2C's "frozen compensation" mechanism can be seen as the industry leader.

3.How Users Can Distinguish Between Different“Frozen Compensation”** Mechanisms**

Although major exchanges have launched their respective "freeze compensation" mechanisms, a closer look at the rules reveals that each has its own merits. The key is how users choose and utilize the "freeze compensation" mechanism that best benefits investors.

In terms of the compensation ratio, the higher the compensation ratio, the more it can reduce potential losses after freezing. Especially "100% full compensation." "Full compensation" can directly cover the financial losses incurred by users due to card freezing, allowing users to avoid suffering losses while bearing risks. It is important to note that some platforms offer 100% compensation, but their compensation limits may not be high. If users are accustomed to large transactions, they should choose platforms with higher compensation limits; if they are used to small transactions, they should confirm whether small orders can enjoy "100% full compensation." From the perspective of the compensation ratio, OKX certified merchants can receive 100% full compensation for amounts within 500U, while bulk merchants offer 100% compensation with a maximum limit of 30000U, which is far ahead in the industry and can maximally meet the compensation needs of both small and large traders.

In terms of the source of compensation funds, users can choose platforms that provide a layer of protection with platform compensation funds, adding an extra guarantee for users to claim compensation. Regarding fees, users may prefer platforms with "zero fees."

2. Leading Exchanges and Users Build a Safe Defense Line for C2C

1.Top Exchange's“Security Action”

To ensure the security of C2C transactions on the platform, top exchanges are taking actions beyond just "freezing payouts", but are strictly monitoring from multiple dimensions such as "strictly managing merchants", "optimizing customer service teams", and "tightening risk control systems".

1) Strictly manage merchants

Three platforms focus on merchant management and have made various efforts to ensure the security of user transactions. For example, OKX, Binance, and Huobi have all introduced "Merchant Management Regulations" to constrain merchant behavior by establishing corresponding rules, effectively safeguarding user rights. OKX has also categorized C2C certified merchants into two major levels: certified and diamond. Furthermore, it has set assessment periods for diamond merchants and will dismiss those who do not meet the assessment criteria.

2**) Optimize Customer Service Team**

Mainstream exchanges are actively upgrading their customer service systems: OKX, Binance, and Huobi HTX efficiently respond to customers through hierarchical management, team collaboration, and the integration of intelligent and manual support. For instance, OKX stipulates that the first response time to all user inquiries must be within 10 minutes, but most OKX customer service representatives can identify issues and provide solutions within 2 to 3 minutes. During peak periods, they can even handle 300 to 400 user inquiries in a single day, truly achieving 24/7 order dispute resolution.

3**) Strict Risk Control System**

Leading exchanges continue to strengthen risk control capabilities: Binance monitors trading through a risk control engine with strong computing power; OKX launched "OKX Protect" in May this year, providing systematic product security mechanisms such as AI monitoring, POR, self-custody, round-the-clock expert support, regulatory compliance, network defense teams, and feedback mechanisms to ensure safe operations on the platform; Huobi also underwent a technical upgrade in the same month. In summary, major mainstream platforms are building a C2C risk control barrier through diversified technologies.

**2.How can users achieve a smooth C2C **trading experience

Users who want to achieve a smooth C2C trading experience must choose both a quality platform and merchants, both are essential.

1**）Choose a leading trading platform with a more完善的“Frozen Compensation”**** mechanism**

As mentioned above, users can pay attention to important dimensions such as the compensation ratio, source of compensation funds, and transaction fees of the platform, and choose an exchange that suits their trading needs. Platforms like OKX, which have compensation ratios and maximum compensation limits that far exceed industry levels, as well as those with platform-backed funds and zero transaction fees, are preferred by users.

2**) Select merchants that meet both the "Identification" and "Data" standards.

For example, on the OKX platform, OKX has set different merchant levels. "Diamond Merchant" refers to top merchants with excellent reputation and huge trading volume; certified merchants are trustworthy and experienced merchants. These labels are displayed clearly on the C2C trading interface, allowing users to choose as needed. In addition, the merchant page on OKX clearly shows the amount of merchant margin, the number of transactions in the last 30 days, transaction rate, number of trading counterparts, and other information. It even fully displays data related to user trading experience, such as average payment time and average release time. Choosing merchants that meet the dual standards of "label" and "data" will help users avoid trading risks and ensure a smooth trading experience.

**Conclusion: When users no longer worry about being **"frozen card"

As more and more ordinary users venture into cryptocurrency trading, the key strategy for exchanges is to eliminate trading risks for users and provide substantial financial security support.

Newcomers who don't understand the complex blockchain technology white papers or the exchange's risk control systems and merchant management rules find it hard to comprehend. The "freeze compensation" mechanism can truly safeguard user funds, becoming a new trend in cryptocurrency exchanges, especially with the "freeze compensation" mechanism of the top three exchanges, which helps crypto users no longer worry about the biggest pain point of "frozen cards."

As the cryptocurrency industry continues to develop and improve, and with the ongoing efforts of exchanges, the era of "frozen cards" may never return and will ultimately become a thing of the past.