According to a new decision made by JPEX, users of the cryptocurrency exchange will not be able to place new orders on its Earn Trading interface from Monday. Existing orders on the interface will continue until their maturity. Many of its users are keen on knowing how the next few weeks turn out for the exchange.
Liquidity Crises Looms Over JPEX Exchange
The crypto platform decided to shut down the trading of some of its wealth management products and increase withdrawal fees due to an ongoing liquidity crisis on the platform. There is also a plan to introduce a Decentralized Autonomous Organization (DAO) initiative to solicit for users’ proposals.
Precisely, some users said that the platform is charging a 999 USDT fee for a withdrawal, with the withdrawal maximum set at 1,000 USDT. The firm claimed that its third-party market makers have “maliciously frozen” the company’s funds. With the outrageous hike in withdrawal fees, it is worth noting that spot trades are still ongoing.
Hong Kong Regulators Go After JPEX
JPEX has been under the investigation of Hong Kong police after it was referred from the Securities and Futures Commission (SFC) for unregistered operations.
The SFC stated that JPEX was operating in Hong Kong as an unregistered entity. In addition, the watchdog claimed that the exchange has made misleading statements regarding its business and regulatory relationships.
Since Hong Kong’s big vision to become a crypto hub, the region has invested so much effort including attracting more individual investors. Therefore, the SFC’s warning to Dubai-headquartered JPEX came as a surprise and it was also the first of such warnings from the regulator.
Crypto Influencers Caught in Crossfire
The crypto exchange made false claims about overseas licensing and promised users unrealistically high returns on their investments. To propagate its false and misleading information, JPEX involved high-profile social media influencers.
One Joseph Lam Chok who is an influencer was arrested in connection to this JPEX case and footage showed police officers carrying boxes into a separate vehicle. So far, Hong Kong police stated that it has received over 83 complaints about JPEX that involve digital assets worth HK$34 million which is approximately $4.3 million, per a statement from police commissioner Raymond Siu.