17th September 2023 – (Hong Kong) JPEX, a virtual asset trading platform, recently faced difficulties with fund withdrawals, prompting the Hong Kong Police to launch an investigation. It was reported that the Securities and Futures Commission (SFC) had referred the case to the Commercial Crime Bureau. In response, JPEX issued a special announcement last night, stating that all transactions on the Earn Trading interface would be taken offline starting Monday, at midnight. Users will be unable to initiate new Earn orders, while ongoing orders will remain active until the end of the product’s duration for profit collection.
According to JPEX’s announcement, the platform’s third-party market makers temporarily locked funds due to unfair treatment and negative news from relevant institutions in Hong Kong. These market makers demanded additional information from JPEX for negotiation purposes, limiting the platform’s liquidity and significantly increasing its operational costs. As a result, JPEX faced operational difficulties.
JPEX emphasised its commitment to safeguarding user rights and revealed ongoing discussions with the third-party market makers to address liquidity issues promptly. However, specific details will only be disclosed once the negotiations are concluded. JPEX described the upcoming delisting of the Earn Trading interface as a response to the restriction on liquidity imposed by the third-party market makers, in line with policy guidelines. The delisting will take effect on Monday, September 18, at midnight (GMT+8), preventing users from initiating new Earn orders. Existing orders will remain active until the end date, allowing users to collect their profits.
In February 2022, JPEX gained significant attention through its cryptocurrency platform advertisements in Hong Kong (Anthony Kwan / Getty Images).
JPEX further stated its commitment to gradually recover liquidity from the third-party market makers and normalize withdrawal fees. During this period, a dedicated team will prioritize emergency withdrawal requests to facilitate user needs. JPEX acknowledged the necessity of restructuring its operations in order to ensure stable and sustainable growth. To this end, the platform plans to collect user suggestions and proposals, engaging in discussions with the dedicated team. Reasonable plans will be selected for a user referendum, the execution details of which will be announced the following day. JPEX reassured its users that it would persist in its operations and make use of all available resources to overcome the challenges posed by irreversible policy risks.
As of 16th September, the Hong Kong Police Commissioner, Raymond Siu, reported that 83 individuals had filed reports related to JPEX, involving a total amount of HK$34 million (approx. £3.1 million). The police urged other affected individuals to come forward and report their cases.
