Hong Kong Financial Watchdog to Bring JPEX ‘Wrong-Doers to Justice’

In a assertion at the moment, Hong Kong’s Securities and Futures Fee (SFC) unveiled a sequence of latest measures geared toward enhancing transparency and safety within the cryptocurrency area.

The regulator’s initiative contains the publication of a complete listing containing licensed, deemed-licensed, closing down, and application-pending digital asset buying and selling platforms (VATPs).

The transfer comes within the wake of the continuing JPEX crypto change scandal and hopes to help most people in figuring out potential unregulated VATPs conducting enterprise in Hong Kong.

The SFC stated that along with the police it plans “to arrange a devoted channel to share info on suspicious actions of and breaches by VATPs and to analyze the JPEX incident to convey the wrong-doers to justice.”

“To assist the general public extra simply establish suspicious VATPs doing enterprise in Hong Kong and improve consciousness, the SFC will improve and concern a devoted listing of suspicious VATPs which is definitely accessible and with prominence on the SFC’s web site,” reads the announcement.

The SFC stated it should additionally discover the opportunity of offering extra details about these VATPs to proactively inform buyers about potential dangers, stating “that is to make sure that info will probably be disseminated in a transparent, clear, and well timed method.”

Throughout a press convention at the moment, the SFC’s CEO Julia Leung Fung-yee stated that the regulator will publish the listing as a consequence of public demand, per a South China Morning Publish report.

She additional clarified that being an applicant for licensing doesn’t essentially signify full compliance with the SFC’s rules.

In response to Fung-yee, as much as that time, solely two cryptocurrency buying and selling platforms—OSL Digital Securities Restricted and Hash Blockchain Restricted—had obtained licenses to serve retail prospects in Hong Kong following the implementation of the SFC’s new digital asset guidelines on June 1.

The SFC additionally disclosed that 4 different firms— HKVAX, HKBitEx, Hong Kong BGE Restricted, and Victory Fintech Firm Restricted—had submitted functions for licenses.

What was the JPEX ‘incident’?

The continued JPEX incident, allegedly Hong Kong’s biggest-ever monetary fraud suspected to have ensnared not less than 2,305 victims, involving roughly HK$1.43 billion ($182.9 million), erupted earlier this month after the Dubai-based crypto change was accused of working with out a license in Hong Kong, the place it had a big buyer base.

The SFC additionally highlighted that sure on-line influencers and over-the-counter digital asset cash changers (OTC retailers) had disseminated false info by claiming that JPEX had submitted an utility for a VATP license.

Within the days that adopted, anxious buyers hurried to withdraw their digital belongings, solely to find that they may solely withdraw a most of 1,000 USDT, the dollar-pegged stablecoin issued by Tether. Nonetheless, they had been reportedly required to pay an administrative payment of 980 USDT.

JPEX was additionally a platinum sponsor of the current Token2049 Singapore occasion, the standing value as a lot as $70,000..

JPEX ultimately suspended withdrawals from the platform final week, asserting that as a consequence of “unfair therapy by related establishments in Hong Kong in the direction of JPEX […] and a sequence of destructive information, our partnered third-party market makers have maliciously frozen funds.”

Hong Kong police have nonetheless arrested 11 individuals in reference to the JPEX scandal, together with social media influencer Joseph Lam Chok. The suspects are going through costs of fraud and working an unlicensed digital belongings change.

In response to the scandal, the SFC issued a warning to the general public concerning the dangers of coping with unregulated cryptocurrency exchanges.

The masterminds behind the JPEX scandal are nonetheless at giant, nonetheless, whereas the change itself—citing Hong Kong’s new crypto regulation regime, which purportedly satisfied it to shift its growth focus to Asia—acknowledged that “it has been getting ready to adjust to the cryptocurrency regulatory system earlier than the tip of the grace interval for the license system” solely to seek out out that it “was subjected to steady unfair therapy.”