Since the end of last month, the principle web domain for digital currency exchange KuCoin, kucoin.com, has been out of commission. It was forced to be taken offline by the High Court of Singapore, which had ordered an injunction against the company on March 24. That measure was an attempt to keep the company from moving any funds or assets as KuCoin faces major legal issues and a corporate shakeup that have rocked its foundation.
The domain, which had been registered through GoDaddy, will remain locked until the courts can determine whether or not it is safe to turn the key. GoDaddy confirmed in an email to Telegraph.com on March 30 that it was adhering to the court order and will have to wait to see what the next step is before making any changes.
There are several issues plaguing the company that have regulators and investors worried. The company claimed to have received $20 million in Series A funding in November 2018, with companies such as IDG Capital, Neo Global Capital and Matrix Partners participating. However, an NGC source said that it never gave financial support to the company, only logistical assistance.
Just ahead of that funding round, KuCoin appeared not to have existed, at least in a physical location. A journalist attempted to visit the company’s offices, which were supposedly, according to the journalist, in Hong Kong, and discovered that they were empty. However, the exchange has continued to operate as if everything were normal. In response to that report, KuCoin asserted, “In fact, KuCoin’s public address in Hong Kong is merely a mailing address of one of KuCoin’s many subsidiary companies. KuCoin Headquarters is in Singapore. KuCoin has always been a global firm, with over 300 employees and four major offices in China, the Philippines, Singapore, and Thailand.”
Last month, the company became embroiled in several lawsuits, including two class-action suits in the U.S., and is accused of “false and misleading statements to account holders.” KuCoin has also announced a major corporate restructuring that some say is an attempt to mask its ownership and possibly under which regulatory jurisdiction it falls. That came after the directors of KuCoin’s parent company, PhoenixFin Pte Limited out of Singapore, suddenly resigned last October as the exchange began a lawsuit in that country.
Halting a web domain is a big deal and KuCoin certainly has given itself enough reasons for the court to act. However, the order doesn’t seem to be tied to any of the aforementioned controversy. Instead, it stems from lawsuit against the company by a cybersecurity provider, but no more details have been offered.
Despite all the troubles, KuCoin still seems to be attracting customers. It reported only yesterday that it is launching an over-the-counter trading desk for enterprises, but those entities shouldn’t go in blindly. With all the issues taking place, sending money to the company right now might be the smartest play.
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