JPEX crypto exchange has initiated its plan to transition into a decentralized autonomous organization (DAO). However, this move is facing opposition from some users who allege their assets are being converted without consent.
Voting Results Favor DAO Shareholder Dividend Program
JPEX announced on October 4 that the voting for its DAO shareholder dividend program concluded on September 28. This was with an impressive 68% of users expressing support for the initiative.
Under the scheme, users have the option to convert their currently frozen assets to DAO Stakeholder dividends at a 1:1 ratio. Notably, JPEX sweetens the deal by offering a repurchase option at 30% of the conversion price after one year. Additionally, a 100% repurchase option after two years.
The program aims to encourage users to keep their funds within the exchange. This is particularly significant as JPEX grapples with liquidity challenges.
Concerns Arise: Assets Converted Without Consent
Despite the seemingly positive reception, concerns have been raised by users. A JPEX user who, wishing to remain anonymous, reported that her assets were converted without her knowledge or agreement. She highlighted the inability to withdraw assets after JPEX’s announcement. Further, she expressed dismay over the conversion to JPC, a token with limited liquidity and utility.
There are reports suggesting that some users were compelled to accept the plan, as the app provided no option to vote against it. This further raises pertinent questions about the transparency of the process.
Legal Troubles Loom: Hong Kong Authorities Take Action
Moreover, JPEX’s dividend plan unfolds amidst legal troubles, with Hong Kong police arresting multiple individuals linked to the exchange. Accused of operating an unauthorized crypto platform, the exchange faces serious allegations of defrauding over 2,300 people of 1.4 billion Hong Kong dollars ($178 million).
In response to the escalating situation, Hong Kong authorities launched a dedicated crypto-focused task force on October 4. The task force, led by the police and securities regulator, aims to combat illicit activities by crypto exchanges. This further signals a heightened scrutiny of the industry.