Following FTX’s bankruptcy, Atom Asset Exchange (AAX) is now the latest crypto exchange in Hong Kong to have troubles. Hong Kong police arrested two executives, Weigao Capital CEO Liang Haoming and former CEO Thor Chan of AAX, on fraud and misleading police charges.
Local media reported on December 23rd that they were accused of preventing customers from withdrawing money while experiencing liquidity issues by using system maintenance as a reason. They spread fake information and shut down the trading site using unlawful methods.
During the inquiry, one made a false statement claiming he had left the firm in May 202. The individual claimed that he purposefully misled the police because the police later discovered that he was a consultant and continued to attend business meetings.
Out of concern about more failures, investors worldwide have begun removing cryptocurrency from exchanges. Due to insufficient liquidity, many platforms had to suspend operations, trapping many assets and escalating investor resentment and mistrust.
However, according to the report, the mastermind behind the events remains unknown and fled from Hong Kong undetected. Alongside his departure, he left with a virtual currency wallet holding an enormous sum of money-approximately $30 million (or 230 million HKD).
337 Reports Against AAX In A Month
AAX has been running since November 2019, and by November 2022, it has managed to amass more than 2 million users worldwide. AAX closed down for system maintenance during the middle of last month, leaving its users unable to check their balances or withdraw and transfer assets.
Since November 16th, victims have repeatedly asked the police for assistance, claiming that the platform has stopped functioning. The police have currently received 337 reports from several places, including Taiwan, Italy, France, mainland China, and Taiwan. Additionally, 190 of them were residents of the area.
According to the report’s statement:
The total loss amount ranged from a few hundred Hong Kong dollars to 12.6 million yuan, and the amount involved reached 98 million yuan.
Furthermore, the two bank accounts belonging to the company were frozen, as well as the account of the individual involved in this case. Additionally, two properties worth about $7 million were seized, which belonged to one of those arrested and the mastermind.
Senior Inspector Huang Zhongli stated:
The current $30 million assets in the virtual currency wallet have not been misappropriated, there is no trace of loss, and they are still safe for the time being.
He also asserts that the police will keep a close eye on the movement of money and virtual currency in the wallet and, as needed, will maintain constant communication with foreign agencies.
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