Chinese police is taking legal action against token trading platform EtherDelta in connection with an exit scam.
The news was reported on August 7th in tweets published by Dovey Wan, founding partner at blockchain-focused investment firm Primitive Ventures.
According to Wan, the alleged exit scam saw the sale of native exchange asset EtherDelta Token (EDT) following the acquisition of the exchange by unnamed Chinese investors:
“The actual beneficiaries of EtherDelta are all Chinese after ownership transition in 2017 […] Basically [the founder] Zack Coburn sold EtherDelta to a group of Chinese who later issued exchange token $EDT and turned out to be a exit scam. Now furious investors of $EDT whistle blowed to local police the case was recently taking into official investigation process”
Wan also noted that “FYI Chinese police shows no mercy if any crypto scam involved large amount of retail capital.”
EtherDelta, a non-custodial marketplace for trading ERC20 tokens, enables users to trade digital assets by means of an order book and Ethereum blockchain-powered smart contracts.