Chinese police are reportedly taking legal action against non-custodial token trading platform EtherDelta in connection with an apparent exit scam.
The news was reported on Aug. 7 in a series of tweets published by Dovey Wan, founding partner at blockchain-focused investment firm Primitive Ventures.
New Chinese owners allegedly used EtherDelta for exit scam ICO
Wan’s tweets indicate that the alleged exit scam involved the sale of native exchange asset EtherDelta Token (EDT) following the acquisition of the exchange by unnamed Chinese investors:
“The actual beneficiaries of EtherDelta are all Chinese after ownership transition in 2017 […] Basically [the founder] Zack Coburn sold EtherDelta to a group of Chinese who later issued exchange token $EDT and turned out to be a exit scam.