• Fri. Jul 19th, 2024

Hong Kong bans two crypto sites for misleading investors

  • Hong Kong’s Securities and Futures Commission (SFC) banned the two crypto websites for scamming users.
  • HongKongDAO and BitCuped were blocked after a joint effort of the police and internet providers.
  • The two cases come not long after investors lost over 1.6 billion HKD ($204 million) in JPEX and Hounax.

Hong Kong’s Securities and Futures Commission (SFC) has reportedly banned two cryptocurrency websites over allegations the site had scammed investors.

The South China Morning Post reported on Wednesday that the securities watchdog had blacklisted and blocked access to the HongKongDAO and BitCuped sites after authorities were tipped off that the platforms were misleading investors.

HongKongDAO touted “HKD” token

According to the SCMP, Hong Kong regulators found that HongKongDAO had hoodwinked users into buying a token dubbed “HKD”. The platform also offered false assurances, lying to users that it had applied for licences from the SFC and government.

HongKongDAO was reportedly on the SFC’s radar since November 24 and was found to have two chat groups. The Chinese chat group had over 10,000 members, while the English one had over 1,700. The project had ostensibly touted HKD as a token with huge market value.

The regulator worked with the police and internet service providers to have the HongKongDAO website blocked. SFC also issued a cease and desist notice to crypto trading platforms, asking them to halt any trading of tokens linked to HongKongDAO.

BitCuped falsely listed Hong Kong Exchange officials as owners

BitCuped, on the other hand, misled investors by falsely listing Hong Kong Exchanges and Clearing (HKEX) chairman Laura Cha and CEO Nicolas Aguzin as affiliated with the platform. SFC noted that neither individual had any connection with BitCuped.

The site misled investors by claiming to offer crypto and stocks trading services, the regulator said. It was blacklisted on November 10.

While the two sites have been banned for scamming investors, the SFC did not disclose how many people had fallen victim, or the total losses suffered. Police investigations are underway, the SMCP reported.

Hong Kong regulators and law enforcement are increasing their efforts to prevent scams such as those that recently involved crypto platforms Hounax and JPEX. In the two cases, fraudulent actors saw more than 1.6 billion HKD ($204 million) stolen from victims.

In August, the SFC warned crypto platforms and exchanges against misleading investors with false claims about their registration status. The regulator also cautioned providers against offering products and services not registered or authorised by the commission.

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