CoinUp threatens legal action as CPX token crashes amid fraud allegations tied to Zhu Pan

Following the sharp crash of its native token, CoinUP, a Singaporean-headquartered crypto exchange has stated that it is exploring legal actions after posts emerged on social media linking it to Zhu Pan, a controversial figure associated with past fraud allegations in China’s crypto scene.

The exchange published two statements on X on June 23 and a detailed notice on its help center within hours of each other, seeking to distance itself from Zhu Pan and explain the CPX token sell-off. 

However, the damage control effort clashed with allegations from Binance co-founder He Yi, who publicly accused Zhu Pan of carrying out an impersonation scam targeting both her and Tron founder Justin Sun.

What is CoinUp’s explanation of the events?

CoinUp, in its help center announcement, linked the CPX price drop to “concentrated selling pressure on the market side” and said the actual cause was undergoing investigation. 

The platform also said that it has completed a security review and found no hacker attack, data breach, or system vulnerability. According to the notice, deposits, withdrawals, and trading remained operational, and user assets were unaffected.

On allegations linking Zhu Pan to the exchange, CoinUp stated that he “is not a member of the CoinUp team and is not involved in CoinUp’s core business management.” 

According to CoinUp, Zhu Pan is a project owner associated with one of the projects launched on its platform.

The exchange also stated in a different post on X that it has observed inaccurate and misleading information spreading across certain media outlets and social platforms and signaled it was considering legal remedies.

What are the allegations against Zhu Pan?

Crypto commentator Web3老吴 made a post on X on June 22 that alleged that Zhu Pan previously ran the ZJLT project in 2018, where he raised hundreds of millions of yuan before the token went to zero.

The post alleged that CoinUp employed similar tactics, including mode-based dividend schemes and lockup mechanisms to trap user funds.

He Yi, Co-Founder and Chief Customer Service Officer of Binance, also lent her voice in the matter, writing, “Spread the word. Zhu Pan once impersonated someone else to try and scam me, but failed. He also impersonated me to scam Brother Sun.”

In a follow-up post, Yi added that Zhu Pan had used AI-generated content to impersonate prominent families in China and Hong Kong, as well as major crypto exchanges, to carry out scams.

She also warned that there is a WeChat account that is currently impersonating Binance founder CZ.

What remains unclear

The scale of the CPX price decline or the volume of the selling activity has not been shared by CoinUp. 

The exchange’s promise to publish investigation results “at the earliest opportunity” leaves open the question of whether the concentrated selling came from insiders, a single large holder, or coordinated market manipulation.

In a press release that was shared in March, CoinUp reported that it recorded $3 billion in average daily trading volume and a $3 billion reserve fund.

CoinUp said at the time that its reserves had passed a Proof of Reserves audit by CER.