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Blockchain
TechPolicy

Defiant JPEX takes swipe at Hong Kong financial regulator as cryptocurrency exchange touts new plan to woo users

  • The embattled platform has outlined plans to offer new investors a deferred payout in a ‘DAO Stakeholders Dividend Plan’
  • The exchange has also reiterated its stance that financial regulators caused the freeze of user funds when it warned that JPEX was unlicensed

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The logo of cryptocurrency platform JPEX. Photo: Bloomberg
Dylan ButtsandXinmei Shen
JPEX is dangling a dividend plan to attract new investors to put money into its cryptocurrency platform, defying concerted efforts by Hong Kong’s police and regulators to stop what could turn out to be the city’s biggest-ever financial fraud.
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The exchange, which suspended trading on Monday and was raided by police on the same day, has outlined a “DAO Stakeholders Dividend Plan”, which promises new users the chance to invest in a dividend paying asset, with a potential buyout price of twice its original price after two years.

Under that plan, the company said it would distribute 49 per cent of the stakeholder dividends, with a total value of US$400 million.

By Thursday, investors who currently have assets frozen in JPEX would finish voting on the plan, which would allow them to convert their funds into DAO Stakeholder dividends with a repurchase ratio of one-to-one after two years, according to JPEX.

DAO stands for decentralised autonomous organisation, which is defined as an entity in which members collectively make decisions. JPEX is run by an anonymous DAO, according to the company’s website.

JPEX advertisements seen at an MTR Station in 2023. Photo: Handout
JPEX advertisements seen at an MTR Station in 2023. Photo: Handout

JPEX’s new plan flies in the face of a crackdown that has already seen at least eleven people arrested for charges connected to aiding and abetting misleading information about the exchange. It underscores the difficulties in policing financial activities in the open internet, where companies offer their services across borders.

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