Understanding Penalty for Delays and Commitment Breaches on EZDEX

penalty on ezdex
writer-avatarKate Hansenpublished_atPublished:2025-07-01updated_atUpdated:2025-07-24est_read_timeRead time :3 Minutes
The Delay Penalty, utilized for the majority of fiat deposit or withdrawal transactions, is a value based on order value, paid as assurance to both parties in the transaction.

At EZDEX, adhering to time commitments and executing transactions on time are among our core principles and fundamental values. In the financial space, even the slightest delay can lead to serious consequences for either party involved in a transaction. Therefore, to maintain trust, transparency, and enhance the security of exchanges, we have established a policy titled “Penalty for Delay or Failure to Fulfill Commitment.”

What is the Penalty for Delay or Failure to Fulfill Commitment?

This penalty is an amount equal to 1% of the total order value, which is frozen as a "Delay or Commitment Failure Penalty" in the account of each party (the exchange and the customer).

For deposit orders, this is typically calculated as 1% of the requested amount in Tether (USDT). For withdrawal orders, the penalty is in the same asset as the withdrawal. This penalty is shown to both the customer and the exchange before final confirmation of order creation or acceptance.

This policy applies to the following order types:

Cash/Bank Deposits

Cash/Bank Withdrawals

If either party fails to meet their obligations within the defined time window, the penalty amount is automatically divided between the other party and the platform according to the following rules:

  • 50% is paid to the affected party as compensation
  • 50% goes to  EZDEX as a processing and review fee

The time commitments are defined by the customer. However, the customer must take into account multiple factors when setting the time window:

The requested amount, the time and date of the request, business hours of exchanges in the origin or destination country, business days and holidays, and banking deposit/withdrawal cycles are all crucial when determining the time commitment.

If both parties fulfill their commitments within the defined time, the frozen amount is returned in full without deductions.

Order Type Exchange Commitment Customer Commitment
Cash Deposit Provide address on time Deliver cash to the provided address
Bank Deposit Provide bank account on time Upload deposit receipt in user panel
Cash Withdrawal Provide in-person address or courier details on time Pay cash on time (by exchange)
Bank Withdrawal Upload bank payment receipt on time Confirm receipt in system (by customer)

💡 Simple Example:

Let’s assume a customer submits a bank deposit order for $1000. In this case:

  • 10 USDT (1%) is frozen in the customer’s wallet
  • Once the order is confirmed by the exchange, an amount equivalent to $1000 from the exchange’s guarantee deposit is frozen
  • If both parties complete the order correctly and on time, both frozen amounts are released in full, and each party's wallet is updated accordingly based on the transaction type
  • In case of a breach, the penalty amount is settled systemically and transferred to the affected party’s account

Why is this Penalty Necessary?

  1. Increased mutual accountability: Both the customer and the exchange will exercise more caution in accepting orders due to the presence of a penalty.
  2. Reduction in abandoned or ignored orders: Many platforms face issues with untracked orders; this policy prevents such cases.
  3. Service quality assurance: Timely order execution boosts trust among customers and exchanges in the platform.
  4. Higher transaction success rate: When both parties are aware that violations have consequences, they act more responsibly.
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