On May 29, 2019, Popo Chen, the founder of cryptocurrency exchange Cobinhood cleared the air surrounding the trading platform in stating that reports of the exchange filing for bankruptcy or pulling an exit scam were false.
A Series of Unfortunate Events
On May 21, 2019, based on Twitter user @SandorReport’s tweet, BTCManager reported how Cobinhood had been accused of defrauding its customers. The company suspiciously went mum after raising $3 million from the DEXON (DXN) initial coin offering (ICO) in April 2019.
The prolonged lack of communication from Cobinhood put its users under significant stress regarding the platform’s legitimacy. Further, reports alleging that the exchange had declared bankruptcy after dumping DXN tokens for healthy profits made the whole situation even worse.
Now, the exchange’s founder has come forward stating that the company did not file for bankruptcy nor did it undergo liquidation. In a Medium post, Chen noted that he was not allowed to comment in public as the exchange had run into legal troubles due to recent incidents.
Chen said that due to legal reasons, Cobinhood Ltd. was forced to announced its suspension on May 20, 2019. Later, the exchange’s parent company – Blocktopia Inc. – formed a smaller team to take over the daily operations of the exchange.
The founder also put to rest the controversy surrounding the alleged dumping of DXN tokens stating that the DEXON Foundation and its co-founders still hold all the DXN tokens. He added that his team would come up with a plan in a month to look after the investor’s concerns who have held DXN tokens during its dramatic free-fall mode.
What Exactly Happened?
According to Chen, on April 26, 2019, one of the institutional investors of Cobinhood had accused him of financial misconduct. At the time, Chen agreed to cooperate with legal investigations as he believed the accusations were misled by false information. However, soon after being accused, the company stripped Chen of all his mediums of communication, including his email, Slack, Telegram, and office badge.
Later, on May 6, 2019, Cobinhood announced on its Telegram channel that it had removed Chen from the corporate affairs committee due to “personal and investor disputes.”
Although the future of Cobinhood remains uncertain, the founder’s message must have brought some respite to the exchange’s worried customers. It remains to be seen what direction the development takes next.