A few hours ago, the news about the arrest of Star Xu, the founder of OKCoin and OKEx, became viral in the crypto/blockchain ecosystem.
According to the original article published in the Chinese news portal Sina News, Mr. Star was arrested as a result of an investigation conducted by the Shanghai Weifang Xincun police due to accusations relating to massive fraud.
The Facts
According to another article the arrest was the result of a joint investigation between the Shanghai and Beijing police forces.
Sina News: Star Xu, founder of OKCoin/OKEX, is being investigated by Shanghai police. According to Lu Jun, officer at the local PD, Xu was suspected of fraud accused by investors. SH police has accepted the case.
Source (in CN): https://t.co/Y6fIt8Sz49https://t.co/ItVfMZ8ZoD pic.twitter.com/Gquv9n7iKs
— cnLedger (@cnLedger) September 11, 2018
The sources allege that the fraud is the result of investments in a project named Wfee , a wifi sharing ecosystem running under a blockchain technology. No further details have been provided.
Faced with these accusations, the OKEx team has remained airtight, refraining from issuing official statements; however, the news portal ETHNews commented in an article that it had the opportunity to communicate with Tim Byun, CEO of OKCoin USA Inc. and CRO & Head of Government Relations of OK Group.
Fake News?
According to the article, Mr.Byun referred to rumors as “fake news” and commented that it was actually the CEO of OKEx who had requested police assistance after being surrounded by a group of investors who lost money investing in tokens listed on OKEx:
However, Tim Byun, OK Group’s chief risk officer and head of government relations, told ETHNews that reports of Xu’s arrest constitute “fake news” and that Xu, in fact, was seeking assistance from police. He pointed to another tweet suggesting that Xu asked the police for support after being surrounded by people who had lost money in crypto on the OKEx. The values of, bitcoin cash, and Litecoin – the four supported on the exchange – have fallen precipitously in the last week.
Apparently, this version was also confirmed by Mr. Heslin Kim, owner of Blockchain Rok Twitter account.
🇨🇳 – Just confirmed with the @OKEx_ team the arrest is fake news. @WhalePanda @cryptomanran @iamjosephyoung
— Heslin Kim @BlockchainROK (@BlockchainROK) September 11, 2018
Official statements are still unknown. The exchange and the authorities have refrained from making comments, and much of what is known is the product of an interaction between investors and people who were on the scene. Some photographs and even live streams of the event were leaked on the internet.
Mr. Xu was released from Shanghai Police at 9:30 pm local time.
Update: Star Xu of OKEX was released from Shanghai police at 9:30pm https://t.co/aieEE4m3Zp
— cnLedger (@cnLedger) September 11, 2018
Edit: A few hours ago, OKEx’s Head of Operations Andy Cheung published a series of tweets about this issue:
Regarding Star Xu's News:
1. As far as I know, Star called the police for help when he was surrounded by a group of people in Shanghai. The police arrived on the scene and invited all of them to the police station.
— Andy Cheung (@AndyC0125) September 12, 2018
