EtherDelta may have done an exit scam, Chinese police investigating

Chinese police EtherDelta

According to recent reports from the Chinese state police department, the EtherDelta cryptocurrency exchange was allegedly involved in an exit scam of their native EDT token.

The platform itself had already gone through a lot of controversy with its previous owner Zack Coburn, who was charged more than $300,000 in fines by the SEC for operating an unregistered exchange.

The exchange is like an anomaly in the crypto world. Traders don’t have to indicate absolutely anything resembling account details. No emails no passwords, no nothing. Furthermore, because the exchange was based on the Ethereum blockchain, quite a lot of ERC-20 tokens were available there, which enticed thousands of traders.

However, in 2017, Coburn sold the EtherDelta exchange to some Chinese buyers who said they wanted to use it as a platform for their future EDT initial coin offering.

According to several investors though, the EDT ICO was nothing but an exit scam and hundreds have filed reports to the Chinese police department, after which the investigations began.

Should the allegations about the exit scam turn out to be true, it’s unlikely that the Chinese law enforcement will restrict itself to only fines for EtherDelta this time.

Giorgi Mikhelidze

Giorgi Mikhelidze

Georgian-born blockchain enthusiast Giorgi leverages his software development background for on point market commentary and analysis. A brief stint with Finance Makers and he's now covering crypto news for high authority websites with the tip learned from past experience, "Whenever you see people talking about the weakness of your idea, don't see it as criticism."

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