The Securities and Futures Commission (SFC) today alerted the public about suspected virtual asset-related frauds involving entities operating under the names “Hong Kong Digital Academy” or “HongKongDAO” and “BitCuped” (Notes 1 and 2).
The Hong Kong Police Force has taken action to block the websites of HongKongDAO and BitCuped at the request of the SFC. The SFC has also issued cease and desist letters to the operators of the relevant websites, requiring them to stop providing purchase services for certain tokens issued by HongKongDAO.
HongKongDAO
HongKongDAO issues a token called “HKD” or “HongKongDAO” (HKD Token), which can be purchased on HongKongDAO’s website.
The SFC suspects that HongKongDAO may have disseminated false and misleading information about itself and its business through online channels. An online article claimed that HongKongDAO:
- Apply for a licence from the SFC to carry out regulated activities in July 2022;
- 于2021年3月取得第4类（就证券提供意见）及第9类（提供资产管理）受规管活动的牌照，因此可自2020年7月31日起从事相关的受规管活动；及
- It is bidding for a "Hong Kong Digital Currency Exchange License", and the article implies that this license is related to the regulatory framework established by the Hong Kong government for stablecoins.
The above claims are all false but may create a false and misleading impression that HongKongDAO’s services and business are properly licensed and legal, thereby inducing others to purchase or subscribe for HKD tokens.
BitCuped
The SFC noted that BitCuped claimed on its website that “Laura Cha” and “Nicolas Aguzin” were the Chairman and Chief Executive Officer of BitCuped respectively, although in fact both persons had no connection with BitCuped (Notes 3 and 4).
Online investment scams may involve any type of assets and be conducted through a variety of channels. Anyone who falls for the scam may suffer significant losses. The SFC would like to remind the public again to beware of investment opportunities and opinions that seem too good to be true (Note 5) shared on social media platforms and instant messaging software, so as to avoid being lured into investing by non-investment professionals. Investors should remain vigilant and beware of fraud when making investment decisions.
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Remarks:
The Hong Kong Digital Academy or HongKongDAO, which claims to be a blockchain service platform operating on the website https://hkdao.info/, was included in the SFC’s warning list of suspicious virtual asset trading platforms on November 2023, 11.
BitCuped claims that it provides virtual asset and stock trading services and operates on the website https://bitcuped.com/. It was included in the CSRC's warning list of suspicious virtual asset trading platforms on November 2023, 11.
Laura Cha is the Chairman of Hong Kong Exchanges and Clearing Limited (HKEX).
Nicholas Aguzin is an Executive Director and Chief Executive Officer of Hong Kong Exchanges and Clearing Limited.
HongKongDAO appears to operate at least two Telegram groups, including a Chinese group with more than 10,000 members and an English group with more than 1,700 members. In these Telegram groups, HongKongDAO appears to have touted the purported “market price” and future increase in market value of HKD tokens, in an effort to entice investors to purchase HKD tokens.