JPEX Moves Forward with Plan to Transition into a DAO
JPEX, the embattled crypto exchange, has announced its plan to convert the platform into a decentralized autonomous organization (DAO) and convert user assets to dividend shares. The “DAO Shareholder Dividend Scheme” received 68% of user votes in favor of the plan. Under the scheme, users can convert their frozen assets to DAO Stakeholder dividends at a 1:1 ratio. JPEX also offers a repurchase option at 30% of the conversion price after one year and a 100% repurchase after two years.
An Incentive for Users Amid Liquidity Issues
The scheme aims to incentivize users to keep their funds on the exchange, which has been facing liquidity issues. Users who participate in the scheme will receive dividends from JPEX through new token listing and trading fees. They will also receive a distribution of JPEX Coin (JPC), the exchange’s native token, proportional to their shareholder dividends.
Concerns Raised by Users
However, some users have raised concerns about their assets being converted without their agreement or knowledge. Following JPEX’s announcement, users found that they could no longer withdraw their assets from the platform. One user reported that her assets had been converted to JPC without her consent, leaving her with low liquidity tokens and no withdrawal option.
Hong Kong Authorities Crack Down on Illegal Crypto Exchanges
This development comes as Hong Kong authorities take action against JPEX for allegedly operating an unauthorized crypto platform. The police have arrested multiple individuals in connection with the exchange, which is accused of defrauding at least 2,300 people of $178 million. To combat illicit activities by crypto exchanges, Hong Kong’s police and securities regulator have established a joint task force.
Hot Take: JPEX Faces Backlash as Users’ Assets Are Converted
JPEX’s decision to convert user assets without their consent has led to backlash from users who can no longer withdraw their funds. This move raises questions about the exchange’s transparency and customer trust. While the DAO transition and dividend scheme were intended to incentivize users to stay on the platform, it appears that some users have experienced negative consequences. As authorities crack down on illegal crypto exchanges, JPEX’s actions may further damage its reputation and hinder its recovery from liquidity issues.
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