Hong Kong opens probe into JPEX exchange

The cryptocurrency exchange JPEX halted trading after the Hong Kong Securities and Futures Commission (SFC) opened an investigation amid a liquidity crisis, media report.

As a result of the raids, one person connected to the platform was arrested. In addition, the SFC says the exchange was operating in Hong Kong without a licence.

“Recently, due to what the company described as unfair treatment by the relevant authorities in Hong Kong toward JPEX, and a series of negative news, our third-party market makers maliciously froze funds,” the company’s blog said.

JPEX representatives added that trading partners demanded more information for negotiations, restricting liquidity and significantly increasing daily operating costs.

Against a backdrop of financial difficulties, from 18 September the platform suspended all operations in the JPEX Earn service, guaranteeing full withdrawal of funds. In addition, the exchange is considering restructuring into decentralised autonomous organisation.

On the site JPEX asserts that the company holds a licence from Australian regulators and is registered with the United States’ FinCEN as a financial services provider.

Meanwhile, some attendees at Token2049 noted that the exchange’s booth was abandoned after the first day.

The Platinum sponsor, JPEX, abandoned their booth at #Token2049 on the second day. ?

On a side note, their logo looks quite similar to FTX. Is that a sign? ? pic.twitter.com/KZw9o5vNgF

— J O Y (@joyxspacelatte) September 14, 2023

In the last 24 hours, the platform’s native token JPC fell 13%, according to CoinMarketCap. As of writing, the asset was trading at $0.02.

Earlier in August, Hong Kong police carried out 458 arrests in 314 money-laundering cases totalling nearly $60 million, a quarter of which involved digital assets.