According to Shenzhen Commercial News, a local publication, Hong Kong authorities have revealed that 145 users on the unlicensed cryptocurrency exchange Hounax were the victims of a scam that cost them a total of 148 million Hong Kong dollars, or roughly $18.9 million.
At a news conference on November 25, the Hounax platform reports were discussed by the local police. According to the Hong Kong Securities and Futures Commission (SFC), 18 complaints on the exchange had been filed as of November 27. The alleged losses ranged from 12,000 HKD to 10 million HKD, or $1,539 to $1.2 million.
![Hounax scam leaves 145 Hong Kong residents crying, losses reach $18.9 Million image 113](https://i0.wp.com/nosisnews.com/wp-content/uploads/2023/11/image-113.png?resize=1024%2C640&ssl=1)
![Hounax scam leaves 145 Hong Kong residents crying, losses reach $18.9 Million image 113](https://i0.wp.com/nosisnews.com/wp-content/uploads/2023/11/image-113.png?resize=1024%2C640&ssl=1)
Hounax, despite claiming to be a licensed platform cooperating with legal financial institutions, was listed as a suspicious platform by the SFC on November 1. The commission issued a cautionary statement to users about the associated risks.
The fraudulent tactics employed by Hounax included misleading claims such as being founded by the original Coinbase technical team, possessing a license from Canadian authorities, and considering investments from prominent entities like Sequoia Capital and IDG Capital. The exchange reportedly recruited local customers through social media, leveraging its purported connections to gain victims.
Notably, the official Facebook page of Hounax is no longer accessible, according to the report. The SFC maintains a list of nine suspicious crypto investment platforms, which includes Hounax, JPEX, Hong Kong Digital Research Institute, BitCuped, FUBT, futubit/futu-pro, EFSPD, OSL trading, and arrano.network.
This incident follows a significant scandal involving the JPEX exchange in Hong Kong earlier in 2023. JPEX received over 2,000 complaints from users, leading to reported losses of around $180 million. Subsequently, 66 individuals were arrested in connection with the scandal.
These events have prompted local regulators in Hong Kong to tighten crypto regulations to prevent further industry catastrophes. Despite this, regulators have indicated that the country’s one-year grace period for crypto exchanges will remain unchanged.
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