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FreeWallet Faces Allegations of Exploitative Crypto Inactivity Fees

FreeWallet Accused of Withholding Funds With Prolonged KYC Checks and Excessive Inactivity Fees

  • FreeWallet faces allegations of lengthy withdrawal delays and high inactivity fees from customers.
  • A user claims months-long identity checks prevented access to their DOGE deposit as fees accumulated.
  • FreeWallet states that inactivity fees are specified in its terms, charging $50 per month after six months of no outgoing transactions.
  • Conflicting information appears in FreeWallet’s FAQs, stating that holding funds is free, while another page confirms fees for inactive accounts.
  • FreeWallet responded publicly to the complaints and is investigating the open support ticket.

A customer has accused FreeWallet, a cryptocurrency wallet platform, of blocking access to funds using extended know your customer (KYC) identity checks and collecting large inactivity fees. The incident came to light after the user publicly asked for help, claiming that these delays resulted in significant financial loss.

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The dispute centers on FreeWallet’s custodial wallet service, which began in 2016. The customer described depositing DOGE years earlier and reported being unable to withdraw because of slow KYC processes. While FreeWallet claims its service is free to join and free for basic use according to its FAQ, another section on the company’s website states that accounts inactive for more than six months are charged a $50 maintenance fee per month.

The customer claimed these inactivity fees were excessive, especially as the value of their DOGE had increased significantly since deposit. Publicly, FreeWallet replied via its official X account: “Please note that no funds were ever stolen. The fees are charged according to our terms of use.” The company later added, “Please share your ticket number so we can look into its details.” according to a recent post.

FreeWallet’s website provides two different explanations of fees. While the FAQ states that sending, receiving, and holding most cryptocurrencies is free, another area outlines that holding some crypto assets is not free after an account becomes inactive. Inactivity is defined as no outgoing transactions, conversions, or purchases over a set period.

Many users who made deposits in the platform’s earlier years reportedly struggle to withdraw funds because they are unable to provide old transaction IDs or emails. During these attempts, inactivity fees may continue to accrue.

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Protos contacted FreeWallet for comment, but the company did not immediately respond. The customer’s support ticket remains open as of this morning, with the possibility of withdrawal access or fee refunds under review.

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