Hong Kong has banned two crypto sites for misleading investors.
The Hong Kong Securities and Futures Commission (SFC) has banned two crypto websites for defrauding users.
HongKongDAO and BitCuped were banned by the joint efforts of the police and internet service providers. The two cases came shortly after investors lost more than HKD 1.6 billion ($204 million) in JPEX and Hounax.
Hong Kong's Securities and Futures Commission (SFC) has reportedly banned two cryptocurrency websites for allegedly defrauding investors.
The South China Morning Post reported on Wednesday that the security watchdog has blocked access to the websites of Hong KongDAO and BitCuped after officials were told the platforms were misleading investors.
HongKongDAO is listed as the “HKD” token.
According to the SCMP, Hong Kong regulators found that Hong Kong DAO users were tricked into buying the “HKD” token. The platform has given false assurances to users that it has applied for licenses from the SFC and the government.
HongKongDAO has reportedly been on the SFC's radar since November 24 and has two discussion groups. The Chinese chat group has more than 10,000 members, while the English one has more than 1,700 members. The project has a huge market value of HKD.
The regulator worked with the police and internet service providers to block the Hongkongdao website. The SFC has issued a cease-and-desist notice to crypto trading platforms, asking them to cease any trading of tokens linked to Hong KongDEO.
BitCuped has listed Hong Kong exchange officials as owners.
On the other hand, BitCuped misled investors by claiming that Hong Kong Exchanges and Clearing (HKEX) Chairman Laura Cha and CEO Nicolas Aguzin were affiliated with the platform. The SFC stated that neither individual had anything to do with BitCuped.
The site misled investors by claiming it offered crypto and stock trading services, the regulator said. It was blacklisted on November 10.
While the two sites were banned for defrauding investors, the SFC did not say how many people were victims or the total losses. A police investigation is underway, SMCP reported.
Hong Kong regulators and law enforcement are stepping up their efforts to prevent scams, such as the recently involved crypto platforms Hounax and JPEX. In the two cases, fraudsters saw more than HKD 1.6 billion ($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 has warned vendors not to offer products and services that are not registered or approved by the commission.
