Users Unable to Withdraw Assets After JPEX Conversion
Users of the Hong Kong exchange JPEX are claiming that they are unable to withdraw their assets after the exchange converted their holdings to JPC. This comes shortly after JPEX announced a new restructuring plan that was approved by 68% of customers. One user stated that their funds became unavailable because the exchange had converted their USDT and other crypto assets to JPC without providing information on the exchange rates. These users are now unable to access their assets and feel that their investments have become worthless.
Is JPEX Locking Users’ Funds After DAO Proposal?
“Given the unknown price and the impossibility of withdrawal, our assets have now become just waste paper.”
There are multiple users who have experienced similar challenges, but JPEX has not publicly responded to these allegations. The situation has raised concerns about whether JPEX is deliberately locking users’ funds following the approval of a proposal to convert the exchange into a decentralized autonomous organization (DAO).
Reports of Withdrawal Difficulties and Dividend Proposal
In addition to the withdrawal difficulties, reports have surfaced that JPEX finalized a dividend proposal to address customer concerns. On October 4, 2023, over two-thirds of JPEX customers agreed to convert the exchange into a DAO. As part of this proposal, users would become shareholders and be eligible for payouts through a DAO Shareholder Dividend Scheme. The company plans to distribute its JPC coin and USDT in proportion to each user’s dividend percentage.
JPEX Advertising Under Scrutiny
JPEX’s recent restructuring follows arrests made in connection with a $191 million fraud at the exchange. The police have apprehended several individuals and formed a joint task force with the Securities and Futures Commission to tackle crypto crimes. Authorities will likely focus on fraudulent marketing messages used by JPEX to attract retail customers. Similar to FTX, JPEX heavily relied on local influencers and made claims of being low-risk and high-yield. New laws in the UK and proposals from the US Securities and Exchange Commission aim to address these issues.
Hot Take: JPEX Faces Backlash for Locking User Funds
JPEX’s actions of converting users’ assets without providing information on exchange rates and subsequently preventing withdrawals have caused outrage among its users. These individuals now find themselves unable to access their funds, leading them to believe that their investments have become worthless. The situation raises questions about the transparency and trustworthiness of JPEX as an exchange. Additionally, the scrutiny over JPEX’s advertising practices adds another layer of concern regarding the exchange’s operations. It remains to be seen how JPEX will address these allegations and regain the trust of its users.
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