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Crypto exchange Bitzlazo has temporarily suspended the withdrawal of Bitcoins from its platform.

In a Telegram post published on Wednesday, the Hong Kong-based crypto exchange announced that it had suspended special balance withdrawals and technical customer support as a “temporary measure.”

Bitzlato is currently dealing with impending court hearings related to the confiscated assets of its users in France.

“We are determined and optimistic about this issue,” Bitzlato said.

Users of both the web version and the Bitzlato app were granted partial withdrawal access to their Bitcoins on March 20th. On September 14, the platform raised the funds limit to 60%.

Following the arrest of its founder Anatoly Legkodymov in Miami on January 18th, the crypto exchange suspended its operations.

According to a December 6th press release from the U.S. Attorney’s Office, Eastern District of New York, Bitzlato processed over $700 million in illicit funds, including millions obtained from ransomware proceeds. Additionally, the exchange was identified as the primary counterparty for the notorious drug marketplace Hydra Market and was found to have advertised lax identification procedures.

Legkodymov pleaded guilty to operating a money transmitting business that transported and transmitted illicit funds.

According to the release, Bitzlato promoted itself as a platform with minimal user identification requirements, explicitly stating that “neither selfies nor passports [are] required.” When Bitzlato did request users to submit identification, it frequently permitted them to openly provide information associated with “straw man” registrants.

Consequently, Legkodymov agreed to shut down the platform and relinquish any claims to approximately $23 million associated with the seized assets of the exchange. As part of the plea deal, Legkodymov submitted a petition for release from custody.

Shortly after, the French Prosecutor’s Office launched an investigation into the company. According to Europol, Bitzlato converted criminal-related assets totaling approximately €1 billion ($1.08 billion). This sum comprises $700 million from the darknet marketplace Hydra and $15 million from ransomware operators.

As part of the operation, law enforcement officers also confiscated the platform’s hot wallet, which held around 35% of user funds across all cryptocurrencies at the time.

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