The JPEX cryptocurrency exchange has sparked controversy and anger among some of its users after it allegedly converted their assets into low-value tokens without their consent.
The exchange, which is facing legal troubles in Hong Kong for operating an unauthorized platform and defrauding over 2,300 people, announced its plan to transform into a decentralized autonomous organization (DAO) and offered users the option to convert their frozen assets into DAO Stakeholder dividends at a 1:1 ratio.
JPEX Remains in the Eye of the Storm
However, some users claim they were not given a choice, and their assets, including Tether (USDT) and other cryptocurrencies, were automatically converted to JPEX Coin (JPC), a token with limited liquidity and utility. These users are now unable to withdraw or trade their assets and fear they will lose their investments.
Some users also reported that they were coerced into accepting the scheme, as there was no option to vote against it on JPEX’s mobile application.
JPEX’s scheme was designed to address its liquidity issues, as the exchange has been struggling to process withdrawals and deposits for months. The exchange also introduced a repurchase option, allowing users to recover 30% of the conversion price after one year and 100% after two years.
However, many users are skeptical about JPEX’s promises and intentions, as the exchange has been accused of multiple crimes by Hong Kong authorities.
The Securities and Futures Commission of Hong Kong alleges that JPEX defrauded over $178 million (1.4 billion Hong Kong dollars) from unsuspecting investors by offering them high returns and bonuses.
Hong Kong authorities have also arrested several individuals linked to JPEX, and have established a crypto-focused task force to crack down on illicit activities in the crypto space.
As JPEX faces legal challenges and users’ discontent over its asset conversion, the future of the exchange remains uncertain. Some users have expressed their intention to take legal action against JPEX, while others have urged the crypto community to boycott the exchange.