HK Crypto Exchange JPEX Embroiled in Regulatory Scrutiny

HK Crypto Exchange JPEX Embroiled in Regulatory Scrutiny

Time Stamp: September 17, 2023 11:54 PM
Source Node: 2886508

Updated 1:00 pm.

JPEX, a cryptocurrency exchange embroiled in regulatory scrutiny in Hong Kong, has announced suspension of all new trades starting Monday. The move comes after HK’s Securities and Futures Commission (SFC) issued a warning regarding the exchange amid waves of consumer complaints.

Key Facts:

  • HK police have received at least 83 complaints about JPEX, as per the South China Morning Post
  • Securities and Futures Commission (SFC) denies JPEX’s claims that it is registered with the regulator.
  • SFC noted and warned promoters claiming that JPEX is registered in HK.
  • JPEX is a platinum sponsor at the recently concluded Token 2049 blockchain conference in Singapore.

Why did JPEX halt trades?

  • JPEX communicated its decision to halt operations Sunday night, citing adverse media coverage that led market liquidity providers to freeze the platform’s capital.
  • This comes on the heels of the Hong Kong police disclosing that they have received 83 complaints against the platform, with digital assets valued at approximately HK$34 million (US$4.3 million).
  • In its Sunday statement, JPEX defended itself, stating that it is subject to unjust treatment but without specifying the entities responsible. It assured its users that measures are underway to restore liquidity and normalize withdrawal fees.

HK Regulator Denies JPEX is Registered

  • Earlier in the week, the SFC had raised the alarm about the platform’s operations, characterizing them as potentially fraudulent and cautioning potential investors. 
  • The financial watchdog indicated that JPEX had failed to submit any licensing applications and had inaccurately claimed to possess authorizations from international regulatory bodies.
    • JPEX says on its website that it is registered in the U.S., Canada, and Australia
  • Notably, JPEX has been advertising financial products that promise unrealistically high returns, largely promoted by social media influencers who are compensated for their endorsements, the South China Morning Post stated.
  • The SFC has issued a directive to online influencers and Over-The-Counter (OTC) shops to cease endorsing JPEX and its affiliated services.
  • The HK police have arrested one crypto influencer, Joseph Lam, in relation to the incident.

This is a developing story.

This article is published on BitPinas: HK Crypto Platform JPEX Halts Trading Amid Regulatory Scrutiny

Sources (South China Morning Post 1, 2)

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