JPEX staff flee event as scandal hits, Mt. Gox woes, Diners Club crypto: Asia Express

Our weekly East Asia news roundup looks at the most important developments in the industry.

The JPEX scandal grows to more than 166 million dollars

Last weeks Token2049 Conference in Singapore It was an experience that changed the lives of some; For others, the event did not live up to expectations, but for a select group of people, the imminent prospect of being hunted down by the authorities meant they had to abandon their stands and flee the event.

On September 21, local mediareportedthat Hong Kong police had arrested 11 people linked cryptocurrency exchange in trouble JPEX accused of fraud and operating an unlicensed virtual asset exchange. It is estimated that more than 2,000 users have been affected by the scandal, with total funds of HK$1.3 billion involved in the incident ($166 million). Police allege that JPEX staff have misappropriated users' assets.

In a dramatic raid on September 13 (the first day of the conference), Hong Kong police arrested key executives, prompting their staff to abandon their corporate booth. The exchange subsequently filed for voluntary deregistration with the Australian Securities and Investments Commission, revealing that its Australian entity had few assets left. After the news broke, JPEX reportedly increased its withdrawal fees to 999 USDT per transaction to prevent capital flight.

in aadvertisementOn September 20, JPEX said that 400 million Tether (USDT) in user deposits would be eligible for redemption. However, the problem is that the funds will only be redeemable from the end of 2025. The company stated that due to the ongoing police investigation, its telecommunications service providers and asset custodians have frozen the applicable services.

In a press conference, John Lee, chief executive of Hong Kong, said: "This incident highlights the importance that when investors want to invest in virtual assets, they must invest in platforms that are licensed." Founded in 2019, JPEX heavily promoted its presence in Hong Kong with brand banners at local subway stations and taxis, as well as enlisting the help of celebrities such as singer Julian Cheung.

Before its collapse, JPEXmarketingIt included free vouchers for any user who signed up, trading leverage offers of up to 300x, and stablecoin staking returns of over 30% annually. The company has since suspended all its services despite earlier assurances that it "will not collapse."

Mt. Gox Trustee Creditors Trolled?

Users of the defunct Japanese crypto exchange Mt. Gox suffered another setback on September 21, when it was announced that bankruptcy trustees would delay payment deadlines for another year. If executed, this means the bankruptcy process would have dragged on for 10 years (if not longer) since a devastating hack destroyed the exchange in 2014.

In April, Mt. Gox established a final deadline for creditors to register a claim against the defunct crypto exchange. October 2023 was then set as a target date for the repayment of users' assets. The registration process has been expanded periodically for several years. Despite previous assurances, the trustees of Mt. Gox wrote:

“Given the time required for rehabilitation creditors to provide the necessary information, and for the Rehabilitation Trustee to confirm such information and participate in discussions and share information with banks, fund transfer service providers and designated cryptocurrency exchanges, etc. ., involved in refunds, which are required before payments can be made, the Rehabilitation Trustee will not be able to complete the above payments before the deadline.”

Mt. Gox was the world's largest Bitcoin exchange when it filed for bankruptcy in 2014, after discovering that 850,000 of its customers' Bitcoin (btc) years of subtle detour had been stolen. Since then, the exchange has recovered around 200,000 BTC. The funds have been held in trust for creditors, with 162,106 BTC ($4.38 billion) in wallet addresses. tracked via token unlocking. At the time of the hack, the price of Bitcoin was around $580 each, meaning that many creditors would have made profits on the investment even though more than half of their BTC was stolen.

In his communication to creditors, the liquidator stated that payments could be made later this year for registered creditors. However, as in the last decade, a caveat was included (as always):

"Please note that the schedule is subject to change based on circumstances, and the specific timing of payments to each rehabilitation creditor has not yet been determined."

Singapore fintech raises $10 million

Singapore company DCS Fintech Holdings received a $10 million investment from Foresight Ventures to create crypto-fiat acceleration solutions.

According to the September 21 announcement, DCS, which originally stood for "Diners Club Singapore," the first credit card issuer in the city-state nation, will use the capital to develop "new payment solutions that provide a seamless connection between Web2 and Web3". .” Its subsidiary, DCS Card Center, is regulated by the Monetary Authority of Singapore for the issuance of credit cards. CEO Karen Low commented:

“Today's rapid evolution of Web3 requires connecting payments to Web2, while the rise of fintechs is democratizing payments for consumers, creating demand for greater variety and refreshing experiences. These are opportunities that DCS is well prepared to take advantage of.”

As part of DCS's initial foray into Web3, it has developed a Singapore dollar-backed payment token, also called "DCS", for the financial services sector.

Also based in Singapore, Foresight Ventures is a $400 million fund that invests in Web3, AI, and blockchain-related entities. In May, the firm promised an additional 10 million dollars for its Web3 accelerator, bringing the total to $20 million. The firm also supports the $120 million Sei Ecosystem Fund.