JPEX Exchange Shuts Down Operations as SFC Probe Escalates

JPEX crypto exchange has responded to SFCโ€™s warning by shutting down some of its operations.

Little JPEX robot on empty grounds as Hong Kong police are behind him.
Created by Kornelija Poderskytฤ— from DailyCoin
  • JPEX exchange has responded to SFCโ€™s warning.
  • Some JPEX operations have shut down amid a crisis.
  • An arrest has been made.

Crypto exchange JPEX has suspended some trading activities on its platform as local and international regulatory scrutiny into the company escalates.

In a statement issued on September 13, Hong Kongโ€™s Securities and Futures Commission (SFC) raised grave concerns about JPEX, labeling it an unregulated virtual asset trading platform and accusing social media influencers of actively promoting its products and services in the country.

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Following SFCโ€™s press release, the commission alerted the police about the exchangeโ€™s activities, prompting an investigation by the Commercial Crime Bureau.

JPEX Shuts Down

In response to the SFCโ€™s warning and the unfolding investigation by the police, JPEX published a press release on September 17, informing customers that all transactions on its Earn Trading interface would be delisted as of September 18, 00:00 (GMT+8).

Per the statement, customers couldnโ€™t place new Earn Orders from that time.

A liquidity shortage also prompted the shutting down of operations after third-party market makers โ€œmaliciously froze fundsโ€ following a series of negative news on the exchange.

โ€œTo protect usersโ€™ interests, we are currently negotiating with these third-party market makers to resolve the liquidity shortage as soon as possible. However, to avoid negatively impacting the negotiation outcomes, the details will be announced after the negotiations are concluded,โ€ the statement read.

A day before JPEXโ€™s press release, police revealed they had received 83 complaints about the exchange involving digital assets worth about $4.3 million.

An Arrest in Connection with the Case

According to local reports, the Hong Kong Police Commercial Crime Bureau arrested a JPEX-linked social media influencer, Lam Zuo, who is accused of promoting the unregulated crypto exchange on the internet.

JPEXโ€™s run-ins with Hong Kong authorities have raised more concerns about the platformโ€™s malpractices. Besides recently vacating its Taipei offices, JPEX reportedly abandoned its booth during the recent Token2049 conference in Singapore.

Stay updated on why Hong Kongโ€™s SFC is after unlicensed crypto exchanges:
Hong Kong SFC Cautions Against Unlicensed Crypto Exchanges

Read more about Hong Kongโ€™s new policy recommendations on Web3 leadership:
Hong Kong Unveils New Recommendations to Boost Blockchain Leadership

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Brian Danga

Brian Danga is a crypto reporter at DailyCoin covering breaking news. Brian has minor holdings in Bitcoin and Ethereum.

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