MEXC has recently released its May and June 2026 security report. The report revealed that the exchange’s futures insurance fund had reached 751 million USDT, and reserves in comparison to major digital currencies were at full capacity.
The security report is a periodic release that carries the target to offer transparency to users and outlines how the trading platform is dealing with its reserves and risk with an overview of the last two months of security operations.
The insurance fund saw a growth of 34 percent in two months
One thing that stood out the most in the released report is the futures insurance fund. On June 29, it had successfully accumulated 751 million USDT, and that is a growth of 34 percent relative to the prior period. The expansion of over 191 million USDT in less than two months. As stated by the exchange, the users can view its status and size by making use of the Proof of Trust page that is available in real-time on its platform.
The main objective of an insurance fund is to absorb the losses that take place in the times of large liquidations. In addition to this, it also reduces the requirement for auto deleveraging, where the profitable market participants may be having their positions reduced to cover the losses elsewhere. The bigger a fund gets, the more it buffers the exchange against sudden shocks when volatility is high. This gives the exchange some additional adjustment room before it has to hit other controls.
Reserve ratios are still above 100 percent
The reserves on purpose, the head of change’s most common digital assets, were all higher than 100 percent and the same is depicting that the exchange held more digital currency reserves in comparison to customer balances at any time.
As a simple example of the above, the largest cryptocurrency, Bitcoin, had the best coverage on the exchange with a reserve ratio of 269.35 percent and was held at 12,656.63 Bitcoin even though customer balances were just 4,698.90 BTC. Ethereum, the largest crypto with a business purpose, had reserves at 118.14 percent. This was followed with USDT at 113.95 percent and USDC at 125.41 percent.
The exchange stated that these figures can be cross-referenced using the platform’s Merkle tree proof of reserves mechanism and public wallet addresses. A reserve ratio over 100 percent means that all of the company’s customers have their balances fully backed, and Bitcoin’s 269.35 percent coverage means that MEXC holds more than 2.5x the amount of BTC it needs to ensure all customer accounts can be withdrawn.
The current active state of fraud prevention
In addition to its compliance activities, MEXC highlighted in the report security measures carried out in the course of the reporting period. The exchange stated that it tracked down 9,518 structured fraud-related accounts and 4,394 were fraudulent networks. For most of the activity, it was operating in the CIS region and Indonesia.
The company’s compliance team received a further 497 requests from law enforcement and courts, a quarter of which, 53, involved asset freezes. Furthermore, seven attempted transfers deemed suspicious, totaling 303,277 USDT, were identified and stopped by the exchange’s monitoring systems and all of this was done before the funds entered the exchange.
MEXC made the recovery for 343,515 USDT that were listed with the 812 cases. It was comprised of the users that made the transfer to the wrong address or blockchain, making the use of a combination of blockchain analysis and manual investigation.
Another relatively small, but relevant section, is user fund recovery. This happens mostly with the newbies, while it can also be the case with the experienced individuals once in a while. When people send to the wrong address and wrong chain, one of the most common operational errors in crypto, an exchange would have to perform a manual review prior to undertaking any sort of attempt to get their funds back.
The major industry challenge is the same: Security
The report is released following the time during which the crypto industry continues to remain vulnerable to security risks. During the time of May and June, blockchain security researchers recorded 142 confirmed security attacks, and the metric of total loss was estimated to be close to $194 million. It was comprised of most funds that were linked to DeFi protocols, cross-chain bridges, private key breaches, and phishing scams.
The exchange additionally reported the fact that the phishing and endpoint attacks have targeted its users and have caused the loss of nearly $28.6 million following that same period.
