Hong Kong’s Securities and Futures Commission (SFC) has officially issued a grave warning to the unregistered cryptocurrency exchange, JPEX. The SFC has cautioned that JPEX may potentially face criminal charges for openly promoting its services to the public. The commission has also expressed alarm over JPEX’s high-yield service, which promises returns of up to 20% and is suspected to be a highly risky investment.
No SFC License for JPEX
This caution is part of the SFC’s broader effort to crack down on unregistered cryptocurrency exchanges and fraudulent activities in the region. The SFC has observed that JPEX has been actively promoting its services through various channels, including social media influencers, key opinion leaders (KOLs), and over-the-counter virtual asset money changers.
It’s essential to note that none of the entities within the JPEX group hold a license from the SFC to operate a virtual asset trading platform in Hong Kong, nor have they applied for one.
Concerns Raised by the SFC
The SFC has highlighted several concerns about JPEX, including deceptive claims about licenses, offering exceptionally high returns, and reports of investors facing difficulties in withdrawing their assets. Additionally, some of JPEX’s products appear to be fishy and may involve dealings that do not comply with the SFC’s regulatory framework.
However, SFC has also informed relevant KOLs and over-the-counter shops about their concerns and has requested them to cease promoting JPEX and its services. The step is taken to minimise the user losses in the process.
Enforcement Measures SFC Can Take, Investors To Stay Alert
It is quite evident that the SEC can take control over such entities which engage in fraudulent or deceptive practices involving virtual assets against the law, and they are fully prepared to take enforcement actions against individuals and entities not adhering to their regulations.
In the whole process, investors need to stay alert when they get such scam offers that are too lucrative, especially those promoted on social media platforms by KOLs who may not have professional investment expertise. The SFC also warns against trading virtual assets on unregulated platforms, as investors may face significant risks.
It is of utmost importance to verify the licensing status of any virtual asset trading platform by referring to the SFC’s list of licensed platforms. Detailed information about JPEX, which has been on the SFC’s Alert List since July 8, 2022, is also provided for reference. Also, check on the SFC-listed exchanges to trade.