- The founder of Hong Kong-based cryptocurrency CEO Global founder has been “taken away” by Chinese police
- The arrest is in relation to the crackdown on money laundering the country
- The exchange has been forced to suspend withdrawals for at least 15 days as a result
China’s crackdown on cryptocurrency exchanges has continued with the apparent arrest of another exchange founder. Hong Kong-based exchange CEO Global reported over the weekend that their founder was “taken away” by Chinese authorities as part of the wide-ranging investigation into money laundering that saw OKEx CEO Star Xu detained for more than a month, with withdrawals suspended on the platform in the meantime. Likewise, CEO Global has reported that functionality of its exchange has also been compromised as the founder was required to access cold wallets used to top up the exchange’s hot wallets.
CEO Global Founder Involved in Alleged Fraud
CEO Global users were informed of the news via a statement issued Saturday by the exchange, which said that the “core founder’s” bank card received ““telecommunications network fraud” inflows of black money”, and as a result he had been “taken away by the relevant authorities for investigation for 15 days.”
The statement added that as “most of the cold wallet private keys on the platform have been kept by the founder”, the exchange is now unable to add funds to its hot wallets from its cold wallets. This has led to withdrawals from the exchange being suspended for at least 15 days, and possibly longer if the investigation continues.
15 Days Could Be Just the Start
As we saw with OKEx and Star Xu, there is no knowing exactly how long officials will keep the CEO Global founder in their custody for, and indeed, if he is found guilty on any charges then it is possible that the exchange may have to close down if the authorities deem it fit to seize the CEO Global funds.