What do you mean, “cryptocurrency”? Chinese police will not investigate the crypto exchange hack

The Chinese cryptocurrency exchange and trade platform, OKEx, has been hacked, with criminals withdrawing funds totaling to $3 million. What would a trader do in this situation? Naturally, he/she would tell the police.

But here’s the big problem: unlike fiat exchanges, cryptocurrency exchanges are not very welcome in China. The latest measures imposed by the government led to the closure of ViaBTC and other relatively old exchanges after 30th of September, 2017. This exchange hack, however, happened at the end of August. The police, while knowing about the recent exchange ban, tells it will not start investigation, as the main victim is not a legal entity anymore.

Here we see how the legislation, imposed after the harm was done to business, restricts the law enforcement from opening the case and compensating the participants’ losses. One can be certain that in many other countries, the governmental bodies would have rejected to investigate as well, because crypto exchanges are not yet legalized there. Russia, Ukraine, other Commonwealth of Independent States members either still have crypto exchanges in the gray legal zone or consider them Ponzi schemes altogether, and sometimes the opinion varies among the officials of the same country.

This legal underdevelopment is the reason why some Russian officials were partly right when telling that crypto traders act at their own risk. Our website strongly recommends choosing respectable and stable exchanges as well, preferably based in the first-world countries which welcome cryptocurrency trading.