As authorities declared XtraderFX insolvent, the news triggered panic amongst its users as funds close to $2 million have allegedly been lost. Authorities in the United Kingdom have reported that they have closed the operator of XtraderFX, GPay, as it became insolvent, and approximately $1.84 million of the user’s funds have reportedly been lost.
Shady crypto platforms are a headache in the crypto realm. XtradeFX, previously known as Cryptopoint, quickly became famous amongst the crypto traders. The platform proudly offered an institutional-grade trading platform that provided advanced features. Many high-profile entrepreneurs endorsed XtraderFX, which helped create a reasonably large user base.
Lately, many complaints were emerging from various quarters of the trading community that ultimately attracted Insolvency Services. Subsequently, GPay’s operations were investigated, which led to the insolvency.
U.K. high court declared XtraderFX insolvent
Investigations into the XtraderFX unearthed shocking information that $1.84 million belonging to 108 users has been lost. The Insolvency Service discovered that despite securing their accounts with insurance, many clients still their assets. The investigation also revealed that the XtraderFX withdrawal process was far more difficult compared to the depositing process.
There were hints about wrongdoings much before the XtraderFX insolvent news became viral. Users reported that whenever they filed a withdrawal request, they were told to deposit miscellaneous documents ranging from photo ID to debit and/or credit card details.
GPay petitioned by the court to wind up operations
XtraderFX insolvent proceedings were ordered as per a petition by a UK high court, which forced GPay to close its operations. The company has not defended itself against the order.
As per the court, the company did not display any commercial probity. Also, they didn’t file any statutory accounts. The court mentioned that the company doesn’t maintain any presence in its registered office.
David Hill, the chief investigator appointed by the Insolvency Service, said that GPay is a scam. He added that GPay customers were enticed to deposit large sums of money under the pretext of cryptocurrency trading. However, none of the users ever earned profits from their investments, and most were tricked by the company to use their online trading platform.
With XtraderFX insolvent, the development has once again bought to fore the various professional-grade scams lurking in the crypto underbelly. Such crypto scams are a warning to the crypto trading community that suitable checks must be made prior to investing in any platform.