China’s largest cryptocurrency market data platform, Feixiaohao, is reportedly facing legal troubles as its team has been detained by law enforcement. While the exact details behind the detention remain unclear, a report from Chinese media suggests it could be related to compliance issues or disputes concerning Feixiaohao’s business practices.

Feixiaohao, the largest simplified Chinese cryptocurrency market data website, has been under investigation by the Inner Mongolia police for over six months. Several key team members are allegedly in police custody, and attempts to contact representatives of the Shanghai-based platform have been unsuccessful.

Feixiaohao’s Business Model and Challenges

Feixiaohao operated as a data aggregation platform, providing real-time data on various digital assets and exchanges. Its revenue model included listing fees paid by cryptocurrency projects, selling advertising space, and promotional partnerships with exchanges and project teams. However, following China’s crackdown on the cryptocurrency sector, the platform had to cease operations in mainland China.

Previous Controversies

The report indicates that Feixiaohao was previously scrutinized for promoting shady exchanges and scam tokens. For instance, in November 2021, the platform advertised the Squid Game token, based on a popular Netflix show, which eventually turned out to be a rug pull.

“Feixiaohao ran a large advertisement for Squid Game in a prominent position. On the other hand, Squid Game’s 24-hour trading volume has fallen by 33%.”

Current Status

Currently, a team claiming to be Feixiaohao exists, but the report alleges that this team is not the original. Instead, it is believed to be a new group that acquired access to Feixiaohao’s codebase and is attempting to continue operations using the Feixiaohao brand.

China’s Regulatory Environment

Since labeling cryptocurrency transactions as illegal in September 2021, Chinese authorities have continued to crack down on the broader digital asset ecosystem. In 2023 alone, over 42,000 individuals have been prosecuted for involvement in fraudulent activities involving cryptocurrencies.

Despite stringent regulations, China has continued to witness a rise in crypto-related crimes. Stay updated on the latest developments in the cryptocurrency world by exploring more news on Global Crypto News.

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