JPEX Hong Kong users reportedly coerced into accepting dubious dividend plan


22nd September 2023 – (Hong Kong) The saga surrounding an alleged cryptocurrency scam in Hong Kong that reportedly defrauded investors of HK$1.37 billion continues to unfold, with revelations raising fresh concerns about oversight and consumer protection.

Users of the JPEX trading platform claim they were given no choice but to approve a dubious “DAO Stakeholders Dividend Plan” unveiled this week, despite ongoing police investigations into the unlicensed exchange. The proposal pledged to distribute 49% of holdings to investors, with an option for repurchase within two years at double the original value.

However, sources alleged the vote presented users with an “agree” button only, preventing rejection. As of Friday, 71% had ostensibly consented despite the questionable legality and credibility. Tech experts deem it “very suspicious” given assets were transferred to equity status rather than repayment.

The apparent coercion has intensified scrutiny of Hong Kong’s regulatory regime for virtual assets. On Friday, Hong Kong government’s top official said the saga illustrated an “urgent” need for guidelines, hinting at impending changes. His comments echoed warnings from authorities and lawmakers for the public to exercise caution in an unlicensed field vulnerable to volatility and manipulation.

Eleven arrests have failed to recover most funds or stem public outrage. Victims abandonment following the “forced” ballot suggests self-regulation may be insufficient. JPEX remains defiant in the face of allegations involving more victims and astronomical sums than any past crypto case locally.

As investigations continue and debt piles up, critics argue consumer safeguards have not kept pace with innovation. While potential remains, proper governance is paramount to protect both individuals and Hong Kong’s reputation amid growing regional competition. Whether lessons can be learned from this debacle about balancing opportunity and oversight risks widening a rift of distrust.