Investors and local media are chasing after Xu Mingxing, founder of OKCoin and cryptocurrency exchange OK Exchange, for suspected fraud and irregular account management. A recently published story on major portals including Tencent Tech done by ChainTruth media account, suggests a stakeout planned investors and media outside a Marriott hotel in Beijingโs Chaoyang District, where Xu was rumored to be residing.
Early in March, non-official accusations raised by victim investors criticized Xuโs team for offering false investment information and promising unachievable returns. According to independent tech and finance outlet AI Finance Agencyโwhich later got into a dispute with Xu regarding a report (in Chinese)โon March 24, an investor named Yang Chao held a bottle of insecticide and threatened to commit suicide at OKCoinโs Beijing headquarter in Haidian. Yang had lost in total around RMB11 million ($1.6 million), including money he borrowed from his own companyโs shareholders under Yangโs own name.
โI managed to meet Xu. And he told me to bring two bottles, one for me, and one for him,โ AI Finance Agency quoted Yang as saying.
Yang and other victims also accuse Xu for faking trading data, manipulating exchange accounts, and intentionally blew up investment accounts in option-like OKCoin products and derivatives. They say Xuโs team manage OKCoin and OKExcange, being both a market participant and a referee.
In September, Xu was rumored to have been detained by police in Shanghai for further investigation. A video recording part of a casual conversation Xu had with staff in the station leaked onto the internet. The video went viral but soon disappeared. Xuโs team denied any arrest or investigation. No public announcement of the reliability of the video was made.
Xuโs team also criticized Huobi, a leading Chinese blockchain tech and digital asset trading company, for maliciously organizing attacks and reports.
โFrom internal discussion records I acquired, Huobi learned Xuโs accusations from external media sources,โ a person close to the matter said to TechNode.
โItโs unlikely that the victims will get the money back โ at least Xu will not [respond to all accusations and promise material compensations] publically. A large number of people have made losses [in the OKCoin case and other general digital asset trading cases] โ once youโve started [to pay back], thereโs no way to stop it,โ the person added, and went on saying that legislation will be a slow process. โItโs about something new, and our government is still learning.โ The person didnโt confirm whether the OKcoin investorsโ losses were due to the accused intentional trading manipulation.
At around 3:00 pm today (October 22), Xu published a new Weibo post and criticized โsomeโ mediaโs โillegal stalkingโ in Beijing.
โShouldnโt legal right protection requests be processed by formal legislative departments? You (the media and investors with strong emotions) donโt believe that law can protect your legally-recognized interest? You donโt believe in law?โ Xu further said that the media lacked fact check responsibility to identify faked evidence provided by the โvictimsโ.
Some domestic legal sources TechNode reached out to refused to provide detailed comments on the issue. Identifying the case as โcomplicatedโ was a common response. Until now, cryptocurrency trading and related activities are still illegal in mainland China. No formal and open legal investigation has begun for the OKCoin issue.
