The Hong Kong Securities and Futures Commission (SFC) today warned the public of suspected virtual asset-related frauds involving entities operating under the names of “Hong Kong Digital Research Institute” or “HongKongDAO” and “BitCuped”.

At the SFC’s request, the Hong Kong Police Force has taken steps to block access to the websites of HongKongDAO and BitCuped. The SFC also issued cease and desist letters to relevant website operators requesting such websites to cease offering for purchase a token issued by HongKongDAO.

• HongKongDAO

HongKongDAO has issued a token known as “HKD” or “HongKongDAO” (HKD Token), which is available for purchase on HongKongDAO’s website.

The SFC suspects HongKongDAO may be disseminating false and misleading information about itself and its business through online channels. An online article claims that HongKongDAO:

• applied for licences to conduct regulated activities with the SFC in July 2022;
• obtained Type 4 (advising on securities) and Type 9 (asset management) licences in March 2021, allowing it to engage in such regulated activities from 31 July 2020; and
• is bidding for the “Hong Kong Digital Currency Exchange Licence”, which the article implies is related to the Hong Kong Government’s regulatory framework for stablecoins.

None of the above claims is true, but they may give a false and misleading impression that HongKongDAO’s services and business are properly licensed and legitimate, inducing others to acquire or subscribe for the HKD Token.

• BitCuped

The SFC notes that BitCuped claims on its website that “Laura Cha” and “Nicolas Aguzin” serve as its Chairman and Chief Executive Officer respectively, when in fact none of them has any affiliations with BitCuped.

The SFC once again warns the public to be cautious about too-good-to-be-true investment opportunities and advice posted on social media platforms and via instant messaging apps, on which they may be lured to invest by individuals who are not investment professionals. Investors should stay vigilant and beware of fraud when making investment decisions.