29th September 2023 – (Hong Kong) A newly launched Hong Kong cryptocurrency trading platform called Jade Power appears connected to the embattled exchange JPEX, which police recently moved to block access to on fraud suspicions. An investigation by local media HK01 revealed Jade Power’s website interface and codebase closely resemble JPEX’s, while its parent company board includes executives from listed firm Synertone Comm which had touted ties to JPEX.
The revelations add a new dimension to the deepening JPEX saga which has seen 11 arrests so far and over HK$1.49 billion in losses for victims. It raises concerns about potentially misleading efforts by parties linked to JPEX to launch rebranded platforms and continue questionable virtual asset activities.
Jade Power commenced operations in May 2022 but its website was abruptly shut down last week after HK01 queried Synertone Comm about the links. The episode highlights the need for tighter oversight of cryptocurrency platforms to protect investors, especially given the opacity of firms’ connections.
It was discovered that Jade Power’s website interface strongly resembles JPEX’s, while its backend API code also references “jpex-api-2”. The platforms share an identical slogan “Fix The Money Fix The World” and highlight easy crypto buying and selling. Even their logo image files are similarly named.
Jade Power’s owner “Jade Power Lab Hong Kong Limited” also echoes JPEX’s Chinese name. The firm abruptly renamed itself “Hong Kong Blockchain Development Company Limited” on 25th September as controversies erupted. Further searches uncovered Jade Power Lab’s directors are Synertone Comm CEO Han Weining and executive director Alex Chong. Both also hold directorships at Jade Power affiliates which were similarly renamed amid the JPEX fallout.
Notably, Chong was appointed Synertone executive director in May 2022 when Jade Power launched, suggesting close coordination. The platform boldly claimed it was “committed to obtaining necessary government licenses” despite JPEX being already flagged on SFC warning lists.
Starting from early Thursday (28th), the website of “Jade Power” became inaccessible. In response to this, Synertone Comm stated through their public relations team that they had issued a clarification announcement on 14th September, and all information should be based on that announcement. No additional details were provided, but they mentioned that any updates would be announced through official platforms.
In June of this year, Synertone Comm announced that its wholly-owned subsidiary, RadioWorld, had entered into subscription and shareholder agreements with JPEX, Phoenix International, and JadePower, with the intention of establishing a joint venture involving JadePower. JadePower, as a wholly-owned subsidiary operator, commenced operations of a virtual asset trading platform (VATP) in Hong Kong in May of the same year. The operator also expressed its intention to apply for the necessary licenses from the Securities and Futures Commission (SFC) to operate the VATP in Hong Kong. Synertone Comm announced in June 2022 its subsidiary RadioWorld had signed agreements with JPEX and JadePower to form a joint venture for a virtual asset trading platform. The announcement briefly spiked Synertone’s share price 133%.
However, the SFC had already named JPEX on its unlicensed platforms list at the time, making the partnership announcement questionable. Synertone later backpedaled saying it never participated in JPEX’s actual operations after the SFC explicitly warned against JPEX last week. With Synertone distancing itself from JPEX, the emergence of Jade Power led by its own executives raises red flags. HK01’s queries quickly led to Jade Power’s site being disabled, suggesting a desire to avoid scrutiny of its activities.
The opaque connections between JPEX, Synertone Comm and Jade Power highlight the need for tighter regulation of cryptocurrency platforms where relationships can be unclear. The industry’s complexity allows troubled operators to potentially reconstitute under new guises and continue offering trading services without proper safeguards.
JPEX’s fraud case has exposed dangerous gaps in investor protection. Stronger oversight and approval frameworks are essential to avoid further major scams. Questions will persist on whether authorities should have acted faster given early suspicious signals around JPEX’s aggressive growth.
For now, the links uncovered between JPEX and Jade Power merit urgent investigation given the former’s fraud allegations. Rapid intervention is prudent before retail investors face more harm from the uncontrolled proliferation of dubious platforms.
This saga reinforces that the promise of cryptocurrencies and web3 must be balanced with consumer protections against risky schemes. Especially with the technology still nascent for many citizens, allowing uncontrolled speculation invites abuses and cripples trust. Effective deterrence alongside education on prudent investment is key.
