Bitcoin withdrawal suspension saga: why self custody is the best

[EL MOHA]

So of recent many people got there withdrawal suspended due to a potential poisoning address attack after receiving payment for rainbet campaign managed by Hhampuz, this is common with KuCoin exchange users

what I noticed from the last week payment transaction fdf3ebb10508808c3cde9df6b99a3af60b2cb820020a993b6094f87f5e60471b was that it was flagged to be address poisoning as shown in the image due to two similar addresses in the output.

The addresses are
1. bc1qg4arhl5fuep5tr9r2upplkj8qezur5hxnwxd8w belonging to *Ace* on spreadsheet number 12 and,
2. ⁠bc1qgralnxqcvmg335km595lh542vseqkf3flfyc8w belonging to ChocolateBitcoinK on spreadsheet number 20.

*Ace* join the rainbet campaign from week 31 and with similar adresses as chocolateBitcoinK with both addresses having prefix bc1q and suffix 8w and both coincidentally receiving similar payment, the transaction involving them is tagged address poisoning.

KuCoin exchange has actually suspended the withdrawal of funds from their customers who Recieved bitcoin together with this addresses

In as much as we all know this was a coincidence nobody’s problem it shows that self custody should be adhere to seriously when receiving bitcoin.

Most of us who used KuCoin and other exchanges to recieve payment need to take note that there are many risks involved because of some exchanges policy and it is best to use wallet and then probably move your bitcoin out from the wallet to exchange to sell. This is usually the best practice when Receiving bitcoin.

[Mia Chloe]

Firstly I see no reason why someone on this forum that has ranked enough to be in a signature campaign would receive bitcoins directly to their exchange address and worse of it all a centralized exchange. With all the endless threads and discussion about privacy and decentralization I think it's high time many were already properly informed about these things.

There are alot of things to be learnt from discussions here and the least and most of recurring of them all is the gist concerning privacy and decentralization.

[Nathrixxx]

Mia Chloe, you've said it all, use the centralized exchange and assumed you're sleeping in your room while fire on the mountain, now it's happening already, very soon, they should be expecting something like here comes the list of all suspected accounts from our exchange to have been involved in any illegal activities and therefore, all their coins have being seized, frozen or inaccessible, which is how they have been used to take money way from the rightful owners through their policies, maybe this will taught some lessons.

[Amphenomenon]

Kucoin exchange can be troublesome here and you will have to provide so much personal information to have access to ones account again, speaking from a friend experience. Custodian wallets should be avoided by all means, we keep speaking about this and it's ironic people in the forum are not even giving listening ears to it. Do not send send CEX address for payment or withdrawal, except maybe the business specifically stated this which is even rear. You can maybe move from your own wallet to your CEX if need me for you but making it your main wallet will lead to regret in the long run mostly.

[LucyFurr]

So of recent many people got there withdrawal suspended due to a potential poisoning address attack after receiving payment for rainbet campaign managed by Hhampuz, this is common with KuCoin exchange users

How did you get that information? Is there any place the exchange mentions about blacklisted transactions?

All I see is two similar addresses show mempool show a warning like it could be an attack but if it's actually two different addresses, then there should be no problem with that. Certainly, exchange's blacklisting seems weird to me.

There are alot of things to be learnt from discussions here and the least and most of recurring of them all is the gist concerning privacy and decentralization.

Most guys don't read anything, they just come to a thread and post something and then move on to the next thread, I see that people engage in discussions rarely.

[Ziskinberg]

So of recent many people got there withdrawal suspended due to a potential poisoning address attack after receiving payment for rainbet campaign managed by Hhampuz, this is common with KuCoin exchange users

How did you get that information? Is there any place the exchange mentions about blacklisted transactions?

All I see is two similar addresses show mempool show a warning like it could be an attack but if it's actually two different addresses, then there should be no problem with that. Certainly, exchange's blacklisting seems weird to me.

I agree, there doesn’t seem to be any report of a lot of accounts being blacklisted or suspended just because of that suspicion. It’s understandable if the system flags it and puts a temporary suspension while under investigation. But once they see there’s no real intention to hack or abuse the system, they usually reopen withdrawals.

I think OP is just being extra careful, but without solid proof of a violation, that kind of fear shouldn’t really be there.

[Yaunfitda]

Firstly I see no reason why someone on this forum that has ranked enough to be in a signature campaign would receive bitcoins directly to their exchange address and worse of it all a centralized exchange. With all the endless threads and discussion about privacy and decentralization I think it's high time many were already properly informed about these things.

There are alot of things to be learnt from discussions here and the least and most of recurring of them all is the gist concerning privacy and decentralization.

I do agree, I can't fathom that someone in a campaign is using a centralized exchange to received their payment? We can simply created a electrum wallet for ourselves and I think most of us are doing that because want to have control of our Bitcoin. In this case, if it is flag down then the only way is to explain it to Kucoin or any other centralized exchange if this is the case that he is getting his Bitcoin from a campaign or it is a payment weekly to him. Hopefully, he has learn his lessons here and can get back his one week of funds from Kucoin exchange.

[PX-Z]

Too many threads and too many suggestions already that don't directly use an exchange address to receive payments from signature campaigns, use a non-custodial wallet then send it to the exchange they want for safety and security purposes, why people cant get it.

I do agree, I can't fathom that someone in a campaign is using a centralized exchange to received their payment?

I call it lazyness and too much trust to a central platform since it didn't happened before

[*Ace*]

I have been bent over by the bot for this thread.
Honestly I am not understanding the root cause and why I was included in this thread.
Does Mempool think we are poisoning the payouts?
I will change the address of receipt of funds from the rainbet campaign I am part of

[KiaKia]

If I get you correctly these guys received BTC payment straight into Kucoin BTC addresses? Why are people doing this when transaction fee to move from Bitcoin wallet to exchange is not even up to a dollar?

I hope they have learned their lesson now, it's risky to receive payment into your exchnage account when it's not directly from your crypto wallet, I call this a greed, they want to avoid using up to a dollar to send the Bitcoin to the exchange account.

Centralised exchanges can't be trusted for any reasons, they are always there to take advantage of you and whatever they say is what you have to go with, they are in total control of you and your digital currencies.

[SilverCryptoBullet]

It is only another piece that adds to long list of risky factors of storing your fund on centralized exchanges, online platforms in custodial wallets.

There are many reported cases and sagas about this type of risky issue.
Events made you scare about custodial wallets, centralized exchanges.

To store your fund safely in cryptocurrency and blockchain, there are some things to do.
- Choose a good and secure blockchain. The best is Bitcoin which is Proof of Work, and has a strongest hashrate, no 51% attack reported in history.
- Choose a good wallet to use. A good wallet must be non-custodial (self-custodial) and open-source (or someone call it as reproducible).
- Know how to download, verify, install that wallet, create a wallet, make it backups, test backup, practice wallet recovery, and keep your original wallet and its backups safely.

That's important practice for your fund safety.

[masulum]

Firstly I see no reason why someone on this forum that has ranked enough to be in a signature campaign would receive bitcoins directly to their exchange address and worse of it all a centralized exchange. -snip-

Sometimes people decide to use an exchange wallet address to avoid fees. As we know, when transactions are busy on the blockchain, we have to spend more money to get confirmations faster. I considered using the same method when BTC fees were over $20 during the BRC-20 boom. I almost did it, but I decided against it because if I used an exchange wallet and the wallet address in my account suddenly changed, I might lose my payment. So, for me, it was better to pay fees than lose everything.

[knowngunman]

There are alot of things to be learnt from discussions here and the least and most of recurring of them all is the gist concerning privacy and decentralization.

Most guys don't read anything, they just come to a thread and post something and then move on to the next thread, I see that people engage in discussions rarely.

It's not about reading or joining a discussion, people certainly read and make contributions here but unfortunately, majority don't practice what they discuss or learn here in real life. You'll find people criticising and condemning exchanges on the platform, discussing the dangers involved and offer suggestions to keep away from storing their assets in exchanges but you'll be surprised to discover that they only preach what they don't practice and all their crypto activities revolve around the exchanges. It's really ridiculous to be consumed by what you always warned others to stay away from.

[Darker45]

How come you realized this only now? Isn't the advice of using a non-custodial wallet already a broken record here? You've been on the forum for years already. Or do you have to sell each week's payment that's why you have to use an exchange's address for it?

Convenience isn't even a valid reason when you prefer a centralized exchange over a non-custodial wallet. There are numerous reasons, some of which even dumbfounding, for an exchange to lock you funds or disable certain features. If you're after convenience, the more reason why you should avoid centralized exchanges for receiving regular payments.

[cryptoaddictchie]

This is a very important reminder thanks OP!

Exchanges like KuCoin often overreact with blanket policies, and honest users end up caught in the middle. The address poisoning flag here was just coincidence, but it shows how risky it is to rely on custodial wallets.

Self-custody first, always. Receive campaign payments in your own wallet, then move to an exchange only when youre ready to sell. That way, youre in control and not at the mercy of an exchanges automated security filters just like what happened on this.

Though its their right to check addresses to avoid money laundering.

[Findingnemo]

Firstly I see no reason why someone on this forum that has ranked enough to be in a signature campaign would receive bitcoins directly to their exchange address and worse of it all a centralized exchange. -snip-

Sometimes people decide to use an exchange wallet address to avoid fees. As we know, when transactions are busy on the blockchain, we have to spend more money to get confirmations faster. I considered using the same method when BTC fees were over $20 during the BRC-20 boom. I almost did it, but I decided against it because if I used an exchange wallet and the wallet address in my account suddenly changed, I might lose my payment. So, for me, it was better to pay fees than lose everything.

It is not an excuse for them to use the exchange's address and especially when blocks are filled with transaction paid fees lower than 1sat/vb. If anyone thinks that way then bookmark this thread for regular updates: [Aug 2025]Mempool empty, Consolidate your small inputs @0.27 sat/vbyte

[Ronsbit]

Too many threads and too many suggestions already that don't directly use an exchange address to receive payments from signature campaigns, use a non-custodial wallet then send it to the exchange they want for safety and security purposes, why people cant get it.

I do agree, I can't fathom that someone in a campaign is using a centralized exchange to received their payment?

I call it lazyness and too much trust to a central platform since it didn't happened before

If not for laziness what would it cost them to use their own personal wallet to receive their payment. Being a member of this platform alone should have exposed them to many personal safety measures when it comes to protecting their assets because situations as this can be averted when they receive their payment in their own self custodial wallet rather than it being under the custody of third party exchange.

I have read here in one post before which occured in the past on the ban on mixers and how members funds were all frozen because the wallets they all received their payment from was a wallet directly to a blacklisted wallet  which means the payment wallet which was connected to the blacklisted wallet was linked to their own because they received payment from the wallet directly and for that reasons their account were all frozen and that event alone should have served as an eye opener for others to learn from but here we are seeing such mistake repeating itself again on this platform and this makes me to wonder if people really follow what they talk and learn about here.

What I will advise is that members who are participating in paid campaigns should use their own self custodial wallet to receive payment rather than receiving payment directly to a third-party wallet so that situations as this do not put a set back for them in accessing their funds. "Not your keys, Not your assets" should always be our watch word here as crypto enthusiasts.

[khaled0111]

I can see that many participants in the Rainbet campaign made requests for their payment addresses to be changed.
So, I guess those are the ones OP is talking about and who are using custodial addresses to receive their payments and who got affected by this false positive flag. Is that correct, OP?

I believe mempool.space and the involved exchanges should improve their blockchain analysis algorithms, as the two addresses in question don’t look too similar (only the first and last two characters are identical). The chances for this to happen are small but it doesn’t look intentional, especially since the received amount isn’t that small. In a poisoning attack, the attacker would usually send a dust amount.

[Solosanz]

What is the correlation between this all about with Kucoin?

This is the two address we're talking about, if the address was belong to centralized exchange, how can 2 weeks payment sitting in this address? it supposed to be moved to CEX's hot wallet whenever they received the coins.

Second address hasn't even moved the coins.

1. https://intel.arkm.com/explorer/address/bc1qgralnxqcvmg335km595lh542vseqkf3flfyc8w
2. https://intel.arkm.com/explorer/address/bc1qg4arhl5fuep5tr9r2upplkj8qezur5hxnwxd8w

This mean, @OP is trying to mislead people by claiming both of them are wrong for using centralized exchanges address, when @OP and other users were the one who wrong in this case.

Most of us who used KuCoin

You and your friends, not us.

[EL MOHA]

I can see that many participants in the Rainbet campaign made requests for their payment addresses to be changed.
So, I guess those are the ones OP is talking about and who are using custodial addresses to receive their payments and who got affected by this false positive flag. Is that correct, OP?

Yes exactly many that are currently changing addresses are the participants that got affected so in as much as this not wrong having the similar address KuCoin has it’s policy and it is the reason why the affected participants using KuCoin were flagged. I created the thread after doing my research and it as awareness for myself and others why self custody is important even as little as receiving signature payment exchanges should be avoided.

What is the correlation between this all about with Kucoin?

This is the two address we're talking about, if the address was belong to centralized exchange, how can 2 weeks payment sitting in this address? it supposed to be moved to CEX's hot wallet whenever they received the coins.

Second address hasn't even moved the coins.

1. https://intel.arkm.com/explorer/address/bc1qgralnxqcvmg335km595lh542vseqkf3flfyc8w
2. https://intel.arkm.com/explorer/address/bc1qg4arhl5fuep5tr9r2upplkj8qezur5hxnwxd8w

This mean, @OP is trying to mislead people by claiming both of them are wrong for using centralized exchanges address, when @OP and other users were the one who wrong in this case.

Just as some people usually say, lots do not comprehend after reading or they don’t read to comprehend, I don’t sound rude but you might simply read khaled0111 much better to understand if mine was not well constructed, there is no where on the thread where it was started that the two addresses belongs to centralized exchanges nor that they were the cause of the problem. The thread was explaining why users had their withdrawals suspended and why it is important to use self custody all the time. I didn’t say they used centralized exchange or that both accounts were wrong, but rather was again advocating other participants for more use of self custody to further prevent situations like this.

Most of us who used KuCoin

You and your friends, not us.

You’re not on Rainbet nor do I say you use KuCoin exchange, I am still baffled at your comment because it is clear that many of the participants were affected and the reason why they are changing bitcoin address to another one. So I don’t understand how it affected or didn’t affect you except maybe….

It is not an excuse for them to use the exchange's address and especially when blocks are filled with transaction paid fees lower than 1sat/vb. If anyone thinks that way then bookmark this thread for regular updates: [Aug 2025]Mempool empty, Consolidate your small inputs @0.27 sat/vbyte

Most people got used to this since the days of the network congestion and until now have been way too lazy and reluctant to change the address even after the network is busy, if you can check most signature campaign many participants are still using exchanges.

I have been bent over by the bot for this thread.
Honestly I am not understanding the root cause and why I was included in this thread.
Does Mempool think we are poisoning the payouts?
I will change the address of receipt of funds from the rainbet campaign I am part of

It was absolutely not your fault, and technically that wasn’t anything like address poisoning but it just tagged so by the exchange due to similar address you had. I was just giving out information as to why the other participants who used KuCoin as their receiving address were having there withdrawals suspended and why they should prioritize self custody.

You don’t need to change your address whatsoever because it’s not your fault just a coincidence.

How did you get that information? Is there any place the exchange mentions about blacklisted transactions?

All I see is two similar addresses show mempool show a warning like it could be an attack but if it's actually two different addresses, then there should be no problem with that. Certainly, exchange's blacklisting seems weird to me.

You can simply check or verify this by actually looking at rainbet signature thread and see that some members changed their addresses. Maybe you can see how I got the information