Hong Kong’s troubled crypto exchange JPEX has announced plans to move forward with its DAO Stakeholder Dividend Plan.
This decision comes amid the ongoing investigation into the financial scandal worth over HK$1.5 billion ($191 million) and the arrest of multiple suspects associated with the platform.
The unfolding scandal first came to light when Hong Kong’s securities watchdog identified JPEX as an unlicensed platform and raised concerns about suspicious activities.
JPEX’s DAO Stakeholder Dividend Plan Receives 68% Approval
JPEX had earlier floated the DAO (decentralized autonomous organization) Stakeholder Dividend Plan with its users.
The proposal was passed with 68% voting in favor, the exchange announced in a blog post.
Under the dividend plan, investors are given the option to convert their assets into DAO stakeholder dividends at a 1:1 ratio, with the ability to claim these dividends two years later. The exchange says that users who add fresh assets to this plan can anticipate a potential doubling of their payouts.
These dividends will take various forms, including revenue generated from listing fees for new platform tokens, trading fees from spot and derivative products, and corresponding JPEX coins based on the shareholder’s dividend proportion.
JPEX has committed to distributing 49% of the stakeholder dividends, totaling a value of $400 million.
What has raised concerns among users is the shift of their assets into JPEX’s own digital currency, JPC (JPEX coin), without clear information about exchange rates and the inability to withdraw these assets.
The move has left some users feeling as though their assets have turned into “waste paper.”
Users Claim Dividend Plan Was Forced on Them
The proposed plan has received criticism from users and financial analysts who have questioned the economic viability of the plan.
The crypto exchange said that it is exploring options like peer-to-peer trading to boost platform revenue and enhance user involvement in shaping the platform’s development and business strategies.
However, some users have claimed they were compelled to accept the plan, as there was no voting option against it within the platform’s app.
Earlier, South China Morning Post reported that some users complained that with this dividedn plan in action, they are unable to withdraw their funds.
Experts and investors alike are now keeping a close eye on the evolving situation, hoping that law enforcement can halt the platform’s operations and protect user assets.
As investigations continue and more suspects linked to the case are arrested, the future of JPEX remains uncertain.