The Hong Kong Web3 community is grappling with the fallout from the JPEX incident, which led to alleged fraud totaling HK$1.6 billion ($204 million) and resulted in the arrest of at least 20 individuals. As reported by CoinTelegraph, the incident prompted the formation of a special task force involving Hong Kong’s Securities and Futures Commission (SFC) and the local police.

This collaborative effort aims to strengthen the oversight of virtual-asset trading platforms and ensure the ethical conduct of operators in the crypto landscape. The working group between the Securities and Futures Commission and law enforcement officials will “enhance collaboration in monitoring and investigating illegal activities related to virtual-asset trading platforms,” the financial watchdog said in a statement last week.

In this context, key players in Hong Kong’s Web3 industry have issued a joint statement to offer their perspectives and propose solutions.

The statement begins: “We represent various organizations committed to developing Hong Kong’s Web3 ecosystem, and we have taken notice of the situation at JPEX.” It goes on to commend the Hong Kong government’s swift action: “We strongly believe that the Government of the Hong Kong Special Administrative Region has taken the correct approach in its commitment to the future growth of Web3.”

These industry leaders, representing organizations such as Animoca Brands, Web3 Harbour, OSL, Stratford Finance, Matrixport, VSFG, the Crypto Council for Innovation, WHub, and Nano Labs, have expressed support for the newly formed task force. “Against the backdrop of recent enforcement actions against JPEX, we wish to express our unambiguous support for strict and swift enforcement,” the statement reads.

In addition to enforcement measures, the signatories highlight the need for public education to safeguard investors. According to the statement, “[e]nhanced efforts to educate the investing public [are necessary], in particular about Hong Kong’s regulatory regime for digital assets and their safekeeping, the controls and operations required of licensed firms, and ‘red flags’ for potential scams or fraudulent activities.”

To conclude, the statement reaffirms the industry leaders’ belief in the transformative potential of Web3 technologies. It emphasizes that “Web3 is a net positive force for the Internet” and advocates for Hong Kong to continue its regulatory leadership in fostering a thriving digital asset economy. The statement urges a balanced approach that includes “thoughtful regulation, transparent discourse, and public education.”

The joint statement is endorsed by industry stalwarts including Yat Siu of Animoca Brands, Gary Liu of Web3 Harbour, Angelina Kwan of Stratford Finance, Evan Auyang and Gary Tiu of Animoca Brands, Cynthia Wu of Matrixport, Lawrence Chu of VSFG, Sean Lee of the Crypto Council for Innovation, Karena Belin of WHub, and Jack Kong of Nano Labs.

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