Dozens of clients of Hong Kong-based cryptocurrency exchange Coinsuper claim they can’t get their money back.
According to reports, dozens of customers of the Hong Kong-based cryptocurrency exchange Coinsuper have claimed that they have been unable to collect their funds from the platform. At least seven of them have made contact with the authorities in regards to the situation.
Frozened customer funds on Coinsuper
According to a Bloomberg report from January 7, the problem began in late November. Five customers of the trading arena told the media that they have been unable to withdraw a total of $55,000. (an amount consisting of both digital assets and cash). They have even filed reports with the local authorities in search of a solution to their situation.
Coinsuper executives could not be reached for comment on the matter. Furthermore, over a month ago, the administrator of the exchange’s Telegram channel ceased responding to questions concerning failed transactions. Last week, though, the administrator requested that concerned clients supply their e-mail addresses. Nonetheless, other users stated that there was no follow-up to this move.
According to a Hong Kong police spokesperson, the authorities are looking into another similar instance. Since December of last year, a person who purchased cryptocurrency “through an investment firm” has been unable to collect her assets.
Coinsuper’s trading application is still operational at this time. In the last 24 hours, it has handled nearly $18.5 million in volume.
The Crypto-Environment in Hong Kong
Hong Kong, China’s special administrative region, has an “opt-in” regulatory structure for digital asset trading platforms, which means they can request to be overseen. This methodology, according to Joshua Chu, a consultant with ONC Lawyers, is ineffective, and the city may change its policy shortly.
Last year, local lawmakers proposed enacting legislation allowing only billionaires to exchange digital assets in the megacity. Hong Kong’s Treasury Secretary, Christopher Hui, agreed with the government’s proposal, saying it was a well-thought-out move with positive ramifications for the city.
Coinsuper’s past problems
The platform, which was founded in 2017 and is headed by Karen Chen, a former executive at UBS Group AG, has a tumultuous background. At one point, an unnamed partner from one of the company’s venture capital backers claimed that his firm has written off its entire $1 million investment in Coinsuper.
His company lost communication with the trading platform about a year later, and Chen ceased answering on WeChat. Furthermore, between July and December of last year, a large number of employees quit Coinsuper.
One of the platform’s early sponsors is Pantera Capital, which is run by renowned bitcoin investor Dan Morehead. It led a Series A fundraising round in 2018, with the amount remaining secret.