JPEX, the cryptocurrency exchange operating in Hong Kong, is going through turbulent times as the Hong Kong Securities and Futures Commission (SFC) recently launched an investigation into its activities. According to local media, this investigation also resulted in the arrest of a person associated with the stock market. The SFC alleges that crypto exchange JPEX is operating in Hong Kong without the necessary license and that numerous complaints have been filed against the platform by disgruntled users. Here are the details…
Cryptocurrency exchange delisted transactions
As we reported as Kriptokoin.com, JPEX responded to the situation in a blog post, claiming that they were treated unfairly by the relevant institutions in Hong Kong. According to the exchange, third-party market makers froze the funds and requested additional information for negotiation. This severely restricted the platform’s liquidity and significantly increased daily operating costs, leading to operational challenges.
In light of these liquidity challenges, JPEX announced significant operational changes. The exchange will delist all transactions on the Earn Trading interface starting Monday. They also adjust withdrawal fees while ensuring ongoing orders. Interestingly, JPEX is also considering restructuring as a Decentralized Autonomous Organization (DAO), a move that underlines the turbulent nature of their current situation.
Taiwanese influencers were questioned
Adding to the complexity of the situation, reports from Taiwan indicate that JPEX’s Taipei office was recently evacuated and authorities are questioning Taiwanese influencers hired by the exchange. These developments have raised more questions about the exchange’s operations and interactions with influencers. JPEX claims on its website that it is licensed by securities authorities in Australia and is registered with the US Financial Crimes Enforcement Network (FinCEN) as a Money Services Business (MSB). However, these allegations are coming under scrutiny as the SFC’s investigation progresses. Meanwhile, the exchange’s native token, JPC, has experienced a significant decline, dropping 21% in the last 24 hours, indicating the impact of the ongoing crisis on the platform.
While regular spot trading activities remain functional, JPEX has come under criticism as it is reported to charge a high withdrawal fee of 999 USDT with a maximum amount of 1,000 USDT. While the exchange did not specifically address the issue, it did promise to gradually adjust withdrawal fees to “normal levels” once negotiations with third-party market makers are concluded. Details of this adjustment will be announced at a later date. In its statement, JPEX expressed its commitment to restoring liquidity from third-party market makers as quickly as possible. They also reiterated their intention to return withdrawal fees to normal levels, and details will be announced once negotiations with market makers are completed.
DAO plan announced
In order to involve users in the restructuring process, JPEX announced that it plans to use a decentralized autonomous organization (DAO) to collect suggestions. JPEX cryptocurrency exchange has found itself at the center of regulatory scrutiny and a liquidity crisis, with operations facing significant disruptions. The outcome of the SFC’s investigation and the exchange’s efforts to address these challenges will be closely watched by the cryptocurrency community.
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