Huobi Pro, one of the most known cryptocurrency exchanges in Asia has decided to launch an ICO token dubbed WAX. The token was launched on December the 20th with an incredible support during the first day after its launching. Unfortunately, the company has been accused of pump and dump during the first trading day. Now, Huobi CEO Li Lin, said that they will compensate users with 100 million CNY.
Huobi Accused of Pump and Dump
What happened was that during the first trading day, the WAX token gained more than 6,000 percent. Lots of users decided to buy more WAX thinking that it could be a profitable investment this year. In the end, it did not happen in this way. The next hours, the price fell to 2 CNY per WAX. It is important to mention than the price of this token during the ICO was 6.6 CNY.
Many users that felt that there was something wrong with this situation, that’s why they have decided to investigate. Huobi.pro deleted the white paper and the project overview from its website, the 22nd December. Furthermore, the total WAX in circulation will be 1.8 billion WAX, as reported by the WAX blog. Huobi said that WAX was capped at 180 million, making investors feel cheated.
“The reason we’re issuing 10x the tokens is because it will be more convenient for users of the token. It will make micro transactions more easily calculable, and since WAX was designed to facilitate the millions of daily micro transactions for digital items, this is an important feature include for WAX users,” the WAX blog reads.
Funds to Compensate the Investors
“Huobi Pro has communicated with the Wax project team on the split event. And the Wax team has indicated that they are willing to compensate users’ loss due to the temporary expansion. Huobi Pro will also make compensation to the users who are affected by the split. And the specific compensation details are still under negotiation,” reads an announcement done by Huobi Pro.
About the compensation, Huobi explained that they will take into account the trades between December the 20th and December the 26th. To these trades, there will be applied a formula that will compensate 100 percent of investors loses. Once that the announcement was done, WAX price increased almost 18 percent.
If you want to know more about WAX, you can have a look at the reviews we have done at CoinStaker.
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Tags:BTCchinaCryptocurrencyCryptocurrency ExchangeexchangeGaming IndustryHuobiICOInitial Coin OfferingMarketPump and DumpSouth KoreaWAX