In a sudden and shocking turn of events, Dubai-based cryptocurrency exchange and lending platform JPEX has ceased its operations, leaving its users in turmoil. The closure comes on the heels of a liquidity crisis that struck on September 17th, 2023, causing the platform to halt withdrawals and discontinue its lucrative Earn program.
JPEX Exchange: End Of The Earn Program
JPEX’s Earn program, known for offering attractive annual percentage yields (APYs) of up to 30% for select cryptocurrencies, has been definitively terminated. The platform has disabled all new Earn orders while existing ones will be allowed to run their course. This decision followed a notice from Hong Kong regulators, which raised concerns about some of JPEX’s products, particularly those involving virtual assets. Hong Kong’s regulatory regime for Virtual Asset Trading Platforms (VATPs) does not permit such arrangements, as stated in Notes 4 and 5 of the notice.
Community members also noted a peculiar incident at a crypto event in Singapore where JPEX’s booth was abandoned shortly after the regulatory notice. Some users even observed striking similarities between JPEX’s logo and that of another now-defunct platform.
The Platinum sponsor, JPEX, abandoned their booth at #Token2049 on the second day. 👀
On a side note, their logo looks quite similar to FTX. Is that a sign? 🤔 pic.twitter.com/KZw9o5vNgF
— J O Y (@joyxspacelatte) September 14, 2023
Withdrawals Under Unusual Conditions
While JPEX’s spot trading feature remains operational, a major twist has been introduced regarding withdrawals. Technically, leaves are still allowed, but with a significant catch. Users who attempt to withdraw funds now face an exorbitant 99% withdrawal fee, effectively making it financially unviable. JPEX has indicated that these withdrawal fees will return to normal levels once the liquidity crisis subsides. In the meantime, the platform has assured users that their dedicated withdrawal team will prioritize handling emergency withdrawal requests.
Finger-Pointing and Promises of a Comeback
JPEX has taken a defensive stance in the wake of these developments, vehemently denying any wrongdoing on its part. Instead, the platform has shifted the blame to what it perceives as “unfair treatment” by Hong Kong regulators and alleged malicious actions by its Hong Kong partners, who froze liquidity shortly after the SFC’s warning.
To rebuild and regain user trust, JPEX has expressed its intention to make a comeback in the future. However, the timeline for such a return remains uncertain and shrouded in ambiguity. The platform has also reached out to its user base, seeking feedback on the path forward.
As JPEX navigates through these challenging times, cryptocurrency enthusiasts and market participants will closely watch how this story unfolds, with many eager to see if and when the exchange can rise from the ashes of its liquidity crisis.