Hong Kong has recently banned two cryptocurrency websites, HongKongDAO and BitCuped, after the Securities and Futures Commission (SFC) discovered they were misleading investors and scamming users.
According to a report by the South China Morning Post, the SFC blacklisted and blocked access to the two websites after receiving tips that they were deceiving investors. HongKongDAO reportedly lured users into buying a token called “HKD” and falsely claimed to have applied for licenses from the SFC and government. The platform was found to have two chat groups with over 10,000 members in the Chinese chat group and over 1,700 members in the English chat group.
In the case of BitCuped, the platform falsely listed Hong Kong Exchanges and Clearing (HKEX) chairman Laura Cha and CEO Nicolas Aguzin as affiliated with the platform. The SFC clarified that neither individual had any connection with BitCuped. The website also misled investors by claiming to offer crypto and stock trading services.
The SFC, working in conjunction with the police and internet service providers, took action to have the websites blocked and issued cease and desist notices to crypto trading platforms to halt the trading of tokens linked to HongKongDAO.
This recent ban comes after investors lost over 1.6 billion HKD ($204 million) in fraudulent activities involving crypto platforms Hounax and JPEX. The SFC did not disclose the number of victims or the total losses suffered, but police investigations are reportedly underway.
This crackdown on misleading cryptocurrency websites is part of the SFC’s efforts to prevent scams and fraudulent activities in the crypto space. In August, the regulator warned crypto platforms and exchanges against misleading investors with false claims about their registration status and cautioned against offering products and services not registered or authorized by the commission.
The ban serves as a reminder of the importance of due diligence and caution when investing in the cryptocurrency market. Investors should be wary of platforms making false claims and promises and should verify the legitimacy of any cryptocurrency investment opportunity before taking action.
In conclusion, Hong Kong’s ban on the two cryptocurrency websites for misleading investors demonstrates the authorities’ commitment to protecting investors and maintaining the integrity of the cryptocurrency market. It also highlights the need for greater vigilance and regulatory oversight in the rapidly evolving cryptocurrency industry.