OKEx Founder Arrested by Shanghai Police

The CEO of the world's second largest crypto exchange has been taken to the Shanghai Police department over alleged investment fraud.

On Tuesday, September 11, local Chinese media Sina Newsreportedthat Star Xu, the CEO and founder of cryptocurrency exchanges OKCoin andOKEx, has been detained in Shanghai and taken to the local police department for investigation over an alleged fraud case.

However, while some media sources claim Xu was arrested and held in custody, others report he was just assisting Shanghai police in the investigation of the crypto fraud. Whatever, photographs of Xu at the police station posted in social media did not suggest that he was put under any legal restraint.

https://twitter.com/cnLedger/status/1039472962296926210

Still, it should be noted that the WFEE team, including Xu, is Shanghai-based, while the company’s unit accused of issuing the scam coins is located in Beijing. Thus, Xu might have had no involvement with any illegal activity performed in Beijing.

It was initially known that the maximum custody limit was 24 hours, so if there was no sufficient evidence found, Xu was expected to be released on September 11, at 10 pm local time. Indeed, according to most recent cnLedger post on Twitter, he was released from Shanghai police at 9:30pm.

https://twitter.com/cnLedger/status/1039523921563803654

At the moment, it is still unclear if Xu has anything to do with the scam, but it is obvious that the news might have a significant adverse effect on the OKEx.

Cryptocurrency-related scams are nothing new. Previously, wereportedthat Indian police detained a former politician due to his alleged engagement in the BitConnect scam.