2023-09-27 02:20:11
JPEX case｜Two licensed exchanges agree that supervision clearly states that customers do not need to pay “sky-high” handling fees when withdrawing funds
[Yahoo News Report]The police’s law enforcement actions against the cryptocurrency exchange JPEX are still continuing. Yesterday (27th), they announced the arrest of one more person. The news is that the person in charge of the cryptocurrency exchange shop (OTC) “Money Lupin” has accumulated a total of Twelve people were arrested. The JPEX incident has once again focused the outside world’s attention on cryptocurrency risks. As for the two licensed exchanges in Hong Kong, OSL and HashKey have expressed their agreement with a compliant development model and stated that they will not allow customers to pay “sky-high” handling fees when withdrawing money. Condition. However, some representatives also pointed out that exchanges that have not applied for a license will continue to operate according to the existing method during the one-year “grace period”, while licensed exchanges are subject to the legal framework. They have realized the gap and have reported their opinions to the China Securities Regulatory Commission. . In addition, many of the 12 people arrested by the police were related to OTC. Experts familiar with the industry ecology expressed their hope at the sharing meeting that the authorities would maintain the status quo and not regulate OTC.
Currently, there are only two licensed cryptocurrency exchanges in Hong Kong, namely OSL and HashKey. The four people in the picture (left to right) are Chen Hong, director of OSL Asset Management Department, Huang Luyao, HashKey institutional customer sales director (Hong Kong), Keywolf, partner of blockchain security company Slowmist, and Li Sicong, consultant of Web3 community “852Web3” .
Lin Zuo was arrested in the JPEX incident, and his lawyer Fan Dewei also attended the sharing session.
The handling fee is too high and the China Securities Regulatory Commission is questioning it.
An organization held a sharing session in Central last night. The JPEX incident became one of the focuses. Lin Zuo, who was arrested in the incident, and his lawyer Fan Dewei also attended the sharing session. After the China Securities Regulatory Commission issued a statement on the 13th of this month to raise the charges, JPEX immediately restricted customers to only withdraw 1,000 Tether (USDT) at a time, and once set the withdrawal fee at 999 USDT, which was almost a ban on withdrawals.
HashKey Institutional Customer Sales Director (Hong Kong) Huang Luyao said that although the company did not list the withdrawal fee in the user registration terms, it still listed it publicly on the website. She also pointed out that, like many traditional financial institutions, Companies need to comply with financial regulations and “cannot overdo it.” Chen Hong, director of OSL’s asset management department, pointed out that the China Securities Regulatory Commission has provided them with market application guidelines for reference, and the company’s daily operations cannot deviate too much from industry practices. “If we set the (handling fee) too high, everyone will definitely know. The Securities and Futures Commission will also come and ask us what happened.”
Due to regulatory restrictions, there is a gap in strategies between licensed institutions and unlicensed institutions.
The outbreak of the JPEX incident will inevitably affect public confidence in cryptocurrency and related trading platforms. Huang Luyao said that as a licensed institution, the company needs to comply with the regulations set by the China Securities Regulatory Commission, but she also noticed other exchanges on the market that have not applied for licenses. It can continue to operate according to its method within the one-year “grace period”. This has been reported to the Securities and Futures Commission, but she did not disclose the details of her opinions. As for Chen Hong, he stated that he had expressed his opinions to the China Securities Regulatory Commission on the operation and development of cryptocurrency trading platforms in the past, and emphasized the need to continue to protect the rights and interests of customers.
JPEX once spent a lot of money on publicity in Hong Kong, and once claimed to be “Japanese Cryptocurrency Exchange” and “JAPAN EXCHANGE”. However, it was revealed that it was not on the Japanese Financial Services Agency’s cryptocurrency trading platform license list, and then quietly changed its promotion. . (Image: CHIOA RZHAW OMYAN @ Wikipedia, CC BY-SA 4.0)
“Human nature remains unchanged for thousands of years.”
Huang Luyao also said that he regretted the JPEX incident this time. He also believed that this time, like last year’s “FTX incident”, reflected the importance of establishing regulations and compliance for trading platforms. “Human nature has been around for thousands of years.” “No change, FTX and JPEX are not the first to have an accident, nor will they be the last.” We agree that supervising centralized exchanges is the right direction.
In November last year, some media broke the news that FTX, one of the leading cryptocurrency exchanges started in Hong Kong, and its sister company Alameda Research’s net assets are mostly composed of the company’s same cryptocurrencies, and may have liquidity problems; Its rival Binance once expressed its willingness to acquire FTX to resolve the crisis, but later said that FTX had improper handling of customer funds and gave up the plan; the market immediately fell into panic, FTX was liquidated, and the platform founder Sam Bankman-Fried (SBF) Later, FTX filed for bankruptcy protection, and he was arrested in the Bahamas and extradited to the United States for trial.
FTX founder Sam Bankman-Fried was arrested after the exchange collapsed and was extradited from the Bahamas to New York, the United States, to stand trial. (Photo by Fatih Aktas/Anadolu Agency via Getty Images)
Experts worry that regulation of large OTC transactions will move underground and lead to more robberies.
Among the 12 people arrested in the JPEX case, 6 people including KOL “Chen Yi” (formerly known as Chen Yingyi), “Zhu Gongzi” Zhu Jiahui, and Lin Zuo all opened cryptocurrency OTCs or were related to them. Li Sicong, consultant of the Web3 community “852Web3”, said at the meeting that currently cryptocurrency OTC does not need to apply for a license, so there is no distinction between legal and illegal OTC, and he hopes that the authorities will not legislate to regulate it.
Li Sicong explained that one of the characteristics of cryptocurrency is anonymity, and users can enter and exit assets without disclosing their identities; if the authorities legislate to regulate OTC, they will need to perform KYC (Know Your Customer, Know You) on customers like general financial institutions. Customers) registration process means that cryptocurrency is no longer anonymous. OTC is described as the “last line” to maintain the anonymity of cryptocurrency. He also said that even if OTC cannot achieve customer anonymity, it does not mean that anonymous cryptocurrency trading will disappear. “Citizens can still do peer-to-peer (individual-to-peer) transactions privately, but now you may see a lot of them.” Robbery, there are many head-turning cases related to crypto.”
Li Sicong (pictured) said he does not want cryptocurrency over-the-counter (OTC) exchange shops to be regulated.
After checking the information, we found that there have been many robberies related to large-scale cryptocurrency transactions in Hong Kong in the past. One of them occurred in May last year. Three citizens were trading cryptocurrencies at a shop in the “Chongqing Station” shopping mall in Chungking Mansion. They After transferring USDT equivalent to 1.5 million Hong Kong dollars to the “buyer”, the other party did not pay and instead locked them in the shop. The 24-year-old suspect fled to Yaoyao and was arrested a week later. After investigation, the police found that the suspect spent money to rent a shop in the mall and pretended to be a cryptocurrency exchange shop. He waited for a large seller to contact him to ship goods, and then committed the crime during face-to-face delivery.
The Hong Kong government will release the “Policy Address” for the new year next month. Li Sicong pointed out that Hong Kong has experienced major incidents at cryptocurrency exchanges for two consecutive years. If the Hong Kong government hopes that industries such as cryptocurrency will vigorously develop in Hong Kong, he suggested that officials listen more deeply to the opinions of the industry. Understand their real needs. He also believes that the China Securities Regulatory Commission has shortcomings in handling the JPEX incident and needs to review how to improve it. He also believes that the practice of Dubai can be considered.Establish a new agency to specifically supervise virtual assets。
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