Singapore Court Locks Crypto Exchange KuCoin’s Web Domain

KuCoin.com, the first internet area of cryptocurrency trade KuCoin, has been locked for the reason that finish of March by order of the Excessive Courtroom of Singapore.

The court docket issued a short lived injunction on March 24 barring KuCoin from transferring its property, together with its web site, from the nation. A March 30 e mail from area registrar GoDaddy offered to Cointelegraph reveals that GoDaddy is complying with the court docket order.

How the trade will deal with its main internet tackle locked down is certainly one of many unanswered questions on KuCoin as the corporate undergoes a serious company restructuring and faces authorized challenges across the globe.

Phantom investments in KuCoin

Based in September 2017, KuCoin boasted 5 million customers in 100 nations inside a yr. Simply over twelve months later, on November 14, 2018 KuCoin claimed it had secured $20 million in Round A funding from enterprise capitalists – IDG Capital, Matrix Companions and Neo World Capital. However at the very least a kind of investments didn’t materialize. 

On the time of the announcement, KuCoin CEO Michael Gan said:

“The mixed forces of IDG Capital, Matrix Companions and Neo World Capital will assist KuCoin develop considerably, develop understanding and adoption of cryptocurrency for thousands and thousands of potential customers, and assist these customers extra effectively discover the perfect merchandise out there within the crypto-world irrespective of the place on the planet they might exist.”

IDG Capital boasts notable cryptocurrency firms similar to Coinbase and Ripple in its funding portfolio. As of publication of this text, KuCoin seems as a portfolio firm on the web sites of each IDG Capital and Neo Global Capital, however doesn’t seem on Matrix Companions’ web site.

And but, regardless of what seems on Neo World Capital’s web site, a person with information of the matter advised Cointelegraph through e mail that NGC in actual fact by no means made any funding in KuCoin. Fairly, the agency solely gave logistical help to the fledgling trade.

Representatives of IDG Capital and Matrix Capital didn’t reply to Cointelegraph’s requests for remark.

Many questions on company restructuring

On March 17, 2020, KuCoin issued a press release from Victoria, the capital metropolis of the Seychelles, describing a sweeping corporate restructuring. It introduced the institution of KuGroup, which “consists of three enterprise teams, specifically KuCoin World, KuCloud and the KuChain & KCS Enterprise Group.”

What seems to be a banal company announcement really describes the end result of far-reaching modifications at KuCoin. The company restructuring additionally leaves the possession and regulatory jurisdiction of the trade in query at a time when it’s going through mounting authorized issues, each in Singapore and america.

KuCoin’s March 17 announcement got here simply six days earlier than the U.S.-based legislation agency Schall announced its investigation into KuCoin and one other trade accused of “false and deceptive statements to account holders” in a pending class motion. The trade can also be the topic of a separate class action purchased by Chase Williams within the Southern District Courtroom of New York relating to the promoting of unregistered securities.

In the meantime, the court docket order that forestalls KuCoin from transferring its area to a different supplier, and probably outdoors the jurisdiction of the Singaporean Courtroom, entails a cybersecurity supplier who’s suing the cryptocurrency trade. Extra particulars on that story are anticipated to emerge within the coming days.

On October 14, 2019, simply days after arbitration commenced within the lawsuit in opposition to KuCoin in Singapore, administrators of the Singapore-based entity PhoenixFin Pte Restricted — the authorized entity behind KuCoin and proprietor of the KuCoin.com area — resigned. There was no public announcement made about these resignations, however data filed with Singapore’s Accounting and Regulatory Authority present that co-founders Michael Gan and Tang Ke, in addition to Lian Meng, a consultant of monetary backers IDG Capital, all resigned as administrators of PhoenixFin Pte Restricted. None of them responded to interview requests from Cointelegraph.

Simply two days later, on October 16, 2019, the KuCoin title and emblem trademark was transferred from MEK World, a Seychelles-based entity that had beforehand inherited the trademark from PhoenixFin Pte Restricted. The trademark ended up with one other Seychelles-registered entity, FortuneIcon, which has the very same bodily tackle as MEK World.

For at the very least the previous yr, KuCoin customers had been turning to Reddit to know the corporate’s company construction, missing readability from the trade itself. Within the absence of a response from any of the entities or people talked about, it’s unclear why this far-reaching company restructuring happened or why the corporate’s trademark was reassigned.

Who’s You?

With the co-founders of KuCoin and PhoenixFin Pte Restricted now not on the firm, new administrators similar to Chinese language resident You Au had been appointed. On November 20, 2019 the possession of PhoenixFin Pte Restricted was transferred from PhoenixFin Restricted, a Cayman-based holding firm, to You Au. He had been appointed to the board on the time of the October 14 company restructuring, however his prior relationship to KuCoin is unclear. He isn’t talked about on the trade’s web site, in any of its advertising and marketing materials, within the March 17, 2020 press release, or within the 2017 White Paper which described the trade.

Little is thought about You Au, besides that he’s 28 years previous and formally a resident in Mianyang, a metropolis within the Sichuan province of China. Though Johnny Lyu, the CEO of Phoenix Pte Restricted, was appointed CEO of KuCoin World on March 17, the final word proprietor of KuCoin World appears to be You Au. If he’s certainly a Chinese language resident, he can be topic to Individuals’s Financial institution of China rules that forbid the buying and selling of Bitcoin or different cryptocurrencies, conducting initial coin offerings, and the operation of crypto exchanges.

Neither You Au nor Johnny Lyu responded to Cointelegraph’s requests for remark.

The place on the planet is KuCoin?

In 2018 KuCoin responsed to an “empty workplace” declare relating to a Hong Kong tackle, asserting that its operational headquarters had been in actual fact in Singapore. The corporate’s response said:

“In reality, KuCoin’s public tackle in Hong Kong is merely a mailing tackle of certainly one of KuCoin’s many subsidiary firms. KuCoin Headquarters is in Singapore. KuCoin has all the time been a worldwide agency, with over 300 workers and 4 main workplaces in China, the Philippines, Singapore, and Thailand.”

The trade’s present geographic scenario is much less clear. On its web site, the corporate profile states it “operates within the Seychelles,” a jurisdiction not talked about in its 2018 weblog submit. Not like Binance, Coinbase and Ripple, KuCoin didn’t file with the Financial Authority of Singapore to request a deferral of the requirement to function and not using a funds license. Such deferrals permit these firms to function as funds service suppliers and not using a license by way of July.

With out a license or a deferral, KuCoin can not legally function in Singapore. It stays unclear whether or not KuCoin is nonetheless working in Singapore or if the trade is in actual fact now working elsewhere.

No solutions, regardless of our questions

Cynical journalists love the well-known quote of Germany’s 19th century “Iron” Chancellor, Otto von Bismarck: “Nothing is confirmed till it’s formally denied.” However regardless of repeated requests to KuCoin, its former administrators and its present administrators, all have refused to supply any remark for this text.

Within the absence of readability from any of the people talked about on this article, or from the corporate itself, customers of the KuCoin cryptocurrency trade will probably need solutions on whether or not they’re sending their cash to Singapore, the Seychelles, China — or wherever else on the planet.