The police of the People’s Republic of China are allegedly prosecuting a centralized cryptocurrency trading platform, EtherDelta. The company is rumored to have links to exit scams.
On August 7, the founder of the blockchain-based company Primitive Ventures, Dovey Wan, announced the news. Wan stated that the fraud engaged with the platform’s native crypto coin, EtherDelta Token(EDT) and that the issue was brought up by a number of Chinese investors.
The founder of the trading platform, Zack Coburn, sold the exchange to Chinese investors, that after issuing the EtherDelta Token, ended up being a fraud. The angry investors reported to the Chinese police and they have recently started an investigation on this exit scam.
EtherDelta is a trading platform that focuses on Tokens issued on the Ethereum blockchain (ERC-20). It offers customers trading services for crypto assets with the use of order books.
EtherDelta has had issues with the Securities and Exchange Commission of the US last year. The founder of the company was charged because the exchange was not registered by the SEC.
Zack Coburn did not accept or refuse the accusations, however, he did agree to collaborate and pay the fine of USD 300,000. On the other hand, Coburn also agreed to settle a USD 75,000 penalty and a USD 13,000 interest.