Multiple people have been arrested as a result of a fraud probe into the Hong Kong-based cryptocurrency exchange JPEX, and regulatory oversight of the entire industry has risen. Chief Executive of Hong Kong John Lee emphasized that this occurrence “highlights the importance that when investors want to invest in virtual assets, then they must invest on platforms that are licensed.”

 Crypto Exchange JPEX’s Troubles Continue

JPEX, a cryptocurrency exchange, revealed on Monday that it has halted some trading operations on its system. The Hong Kong police continue to look into the trade as they make this choice. Users won’t be able to place new orders using the platform’s Earn Trading interface, according to the release. According to the exchange, “negotiations with… third-party market makers are underway to address the liquidity shortage.”

John Lee, the chief executive of Hong Kong, stated at a news conference on Tuesday:

This incident emphasizes how crucial it is for investors to only use licensed platforms when they want to invest in virtual assets.

The Hong Kong Securities and Futures Commission (SFC), according to Lee, “will monitor the situation very closely and ensure that investors are sufficiently protected.” He also said that the government would increase education to provide investors with a better grasp of the dangers associated with cryptocurrency trading and the legal framework controlling crypto trading platforms.

See also  NFT Advocates Question Bitcoin's Alleged Downturn as Dominance of Ordinal Transactions Rises

Head of the SFC’s fintech division, Elizabeth Wong, said the agency was looking into whether JPEX had broken the anti-money laundering law and had reported the incident to the police. The Commercial Crime Bureau opened an investigation in response to the report.

The SFC then cautioned investors to use caution while doing business with JPEX, highlighting the fact that the exchange had not submitted any license applications. The regulator also said that JPEX was lying when it claimed to have authorizations from foreign regulators.

The financial authority also noted that many investors relied on false claims made by social media influencers who were being paid to promote items that were advertised on the trading platform and offered returns on savings that were “too good to be true.”

The police announced Tuesday that they had frozen bank accounts worth 15 million Hong Kong dollars ($1.9 million) and seized three properties associated with the exchange for 44 million Hong Kong dollars ($5.6 million), according to the Associated Press.

Related News


Leave a Reply