Chinese police, according to some reports, are investigating the activities of the decentralized exchange EtherDelta.
This was reported by Primite managing partner Dowey Wan.
EtherDelta is involved in a major scam in China, police officially take legal action against it
The actual beneficiaries of EtherDelta are all Chinese after ownership transition in 2017
— Dovey Wan (@DoveyWan) August 7, 2019
She added that platform founder Zachary Coburn sold EtherDelta to a group of Chinese investors. The latter issued an EDT token, shortly after which an exit scam of the trading platform followed. Then angry investors appeared to complain to law enforcement.
She also stressed that the Chinese police are merciless to fraudsters whose actions affect the interests of a large number of retail investors.
Last November, the US Securities and Exchange Commission (SEC) indicted EtherDelta founder Zachary Coburn for managing an unregistered stock exchange.
The regulator’s statement said that the decentralized EtherDelta exchange acted as a secondary market for trading ERC-20 tokens, which the SEC considers to be “digital securities”.