[2017-08-23]OKCoin And Huobi Are Charged With Using Clients Funds In HYIP

[Vialaia]

Two major cryptocurrency exchanges in China, OKCoin and Huobi, allegedly used customers funds, directing them to so-called high-yield investment programs (HYIPs).

The fact that OKCoin and Huobi could improperly use the funds of investors became known in inspections on the leading exchanges of the country, initiated earlier this year by the People's Bank of China...

Read more https://bit.news/eng/okcoin-and-huobi-are-charged-with-using-clients-funds-in-hyip/

[DRVX]

Now government and other structures trying more and more atack cryptocurrency exchanges.
For banks and government cryptocurrencies is standing across the throat.
Anyway still anybody can use bitcoins.

[CryptoBry]

If this is really true then these exchanges are abusing the trust bestowed on them by their clients/members. Now, its implication is that they are not to be trusted and soon there would be new laws or the government can get stricter in the operation of exchanges by introducing/implementing regulations. Well, this expose is just telling us that if humans are not guarded there will always be that tendency to go overboard.

[buwaytress]

I'm not surprised that a lot of the smaller exchanges are doing this. Perhaps erroneous to call them HYIPs, but I would fully expect a lot of exchanges to use their substantial holdings for low-risk ventures. Those multiple alt air drops based on Bitcoin balances, low-interest services (like freebitco.in), intra-exchange loaning, for example. Some exchanges' wallets are known, others may be easily discovered. Pretty sure some of these wallets from OK and Huobi were linked to investment addresses.

Difficult to argue about what constitutes HYIP if this is a legal pursuit but OK's response indicates that they have been transparent about investing inactive funds. If private equity can't be forced to reveal their links, I wonder if the same confidentiality applies here.

[NewbCoins]

is important to remember these informations today

[kevinn669]

I'm not surprised that a lot of the smaller exchanges are doing this. Perhaps erroneous to call them HYIPs, but I would fully expect a lot of exchanges to use their substantial holdings for low-risk ventures. Those multiple alt air drops based on Bitcoin balances, low-interest services (like freebitco.in), intra-exchange loaning, for example. Some exchanges' wallets are known, others may be easily discovered. Pretty sure some of these wallets from OK and Huobi were linked to investment addresses.

Difficult to argue about what constitutes HYIP if this is a legal pursuit but OK's response indicates that they have been transparent about investing inactive funds. If private equity can't be forced to reveal their links, I wonder if the same confidentiality applies here.

I doubt that we will ever learn the truth about the use of funds. While there is no evidence, but there are just mutual accusations and speculation.