JPEX crypto exchange launches asset lock-up plan, some users cry foul

Embattled crypto exchange JPEX has actually pushed ahead with a strategy that will supposedly shift the platform into a decentralized autonomous organization (DAO) and convert user possessions to dividend shares with an incentive to lock them up for two years.An Oct. 4 announcement from JPEX said ballot for its DAO investor dividend program was finished on Sept. 28, declaring 68% of users voted in favor of the scheme.The scheme lets users transform their presently frozen properties to DAO Stakeholder dividends at a 1:1 ratio. JPEX provides a repurchase choice at 30% of the conversion rate after a year and a 100% repurchase after 2 years. Example of JPEXs DAO dividend scheme redeemed alternatives. Source: JPEXIn an earlier statement, JPEX stated users who concurred to the plan would get dividends from JPEX through a brand-new token listing, trading charges and a circulation of JPEX Coin (JPC)– the exchanges native token– in proportion to investor dividends.The scheme appears to incentivize users to keep their funds on the embattled exchange, which is experiencing liquidity issues. However, one JPEX user– who was provided anonymity– informed the South China Morning Post (SCMP) in an Oct. 4 report that her assets had been transformed apparently without her contract or previous knowledge.She claims that she and other users discovered they might no longer withdraw their possessions following JPEXs announcement to proceed with the plan.The Hong Kong police and the citys Securities and Futures Commission have actually formed a joint job force to punish unlawful crypto exchange activities. On the other hand, the JPEX scandal continues to unfold. https://t.co/lOBRNlLs7m— Cointelegraph (@Cointelegraph) October 5, 2023

” All of my [Tether] USDT and other cryptocurrencies are gone,” the individual said. She declared her properties were converted to JPC– a low liquidity token with couple of usage cases.” Some other users holding the tokens and other properties have actually also found them moved,” the user said, including, “Given the unidentified cost and the impossibility of withdrawal, our properties have now ended up being simply waste.” Its not known if individuals priced quote in the report enacted favor of the plan, however some JPEX users formerly informed the SCMP they d been forced to accept the strategy as there was no option to vote against it on its app.JPEX did not instantly react to Cointelegraphs request for comment.Related: New book declares Binance CEO CZ rejected SBFs $40M demand for futures exchangeJPEXs dividend strategy comes in the middle of Hong Kong cops jailing several individuals in connection with the exchange as its accused of operating an unauthorized crypto platform by the regions securities watchdog.Hong Kong cops say the Dubai-based exchange defrauded at least 2,300 people of 1.4 billion Hong Kong dollars ($ 178 million). Previously on Oct. 4, the regions police and securities regulator released a crypto-focused job force to combat illicit activities by crypto exchanges.Collect this short article as an NFT to protect this moment in history and reveal your assistance for independent journalism in the crypto space.Magazine: How to secure your crypto in an unpredictable market– Bitcoin OGs and experts weigh in