• Bitskwela, a web3 education platform, terminated its partnership with crypto exchange JPEX amid regulatory scrutiny, emphasizing its commitment to working with partners who adhere to licensing and regulatory compliance. 
• The company clarified it never advised its community to invest in JPEX products but merely presented it as an exchange option.
• The Philippine Securities and Exchange Commission (SEC) clarified that while there is no specific advisory against streamers and content creators endorsing unregistered projects, they can face legal consequences if their involvement in such projects is proven.

Following the recent regulatory scrutiny being faced by crypto exchange JPEX, the Filipino influencers affiliated with it distanced themselves from the exchange. Web3 education platform Bitskwela announced it is terminating its partnership with JPEX. 

(Read more: HK Crypto Platform JPEX Halts Trading Amid Regulatory Scrutiny)

Bitskwela Statement

“In the interest of the community that Bitskwela serves, and in our mission to lead people from interest to participation in Web3, Bitskwela immediately terminated the partnership with JPEX upon the announcement,” the education platform stated.  Bitskwela announced an educational partnership with JPEX last month. 

The firm reiterated its mission of web3 mass adoption to help Filipinos own a piece of the internet, and that it is committed to working with partners who observe license and regulatory compliance.

“As of September 18, 2023, Bitskwela is no longer affiliated with JPEX,” it announced. 

In a statement, the company acknowledged the necessity for exchanges to adhere to the correct licenses and regulatory compliance and it understands that they cannot exert complete control over industry developments. However, the company emphasizes its ability to control its response to such events within the industry.

“Rest assured, Bitskwela only seeks partnerships with legitimate organizations and exchanges to provide its constituents with platforms to participate in Web3. We will continue to create simplified multi-layer, and multi-lingual Web3 education in partnership with global institutions, ecosystems, and communities to facilitate Web3 mass adoption,” it added.

Clarification from CEO

Moreover, while Bitskwela CEO Jiro Reyes declined to disclose more details about its partnership with JPEX (citing non-disclosure agreements), he clarified to BitPinas that the firm “never told our community to buy their coin or invest in any of their products”. He stressed that the platform only showcased JPEX as an exchange option–its website has a how-to-guide on trading crypto on the exchange. 

Recently, the Hong Kong regulator (SFC) refuted JPEX’s claims of registration and raised concerns about the platform, labeling it potentially fraudulent. The SFC noted that JPEX had not applied for any licenses and falsely asserted authorizations from international regulatory bodies. JPEX has advertised high-return financial products through social media influencers, with some influencers being paid for endorsements. 

Influencers Tapped for JPEX Alliance Program

Subsequent to the regulatory warning on JPEX, the SPC also directed online influencers and Over-The-Counter (OTC) shops to cease endorsing JPEX and its services.

Currently, there are still contents from Filipino and international influencers promoting the exchange and its products. (Editor’s note: At the time this article is being edited, some of the links point to 404 pages already, suggesting that the contents have been deleted.)

In 2022, JPEX launched an Alliance Program to engage the global community and establish an international cryptocurrency ecosystem–it is like the affiliate program other exchanges and businesses also use. It invited community leaders, KOLs, and experienced blockchain enthusiasts to participate where they can enjoy monthly bonuses, exclusive service channels, and professional support from JPEX.

Bonuses are determined by community size and promotional activities.

Members must complete monthly level reviews and can earn wealth management, spot, and contract rebates based on their level.

Can Influencers be held responsible?

Earlier this year, the Philippine Securities and Exchange Commission (SEC) clarified in an that although there is no specific advisory against streamers, content creators, and social media personalities endorsing unregistered projects, they can still face legal consequences if their involvement in such projects is proven. 

Moreover, in 2022, the SEC expanded its list of individuals who could be held criminally liable if the entities they are associated with are found to be illegal and unregistered. This decision is based on the Securities Regulation Code, which stipulates penalties of up to ₱5 million in fines or up to 21 years of imprisonment, or both, for those found in violation of these regulations.

In addition, despite disclaimers like “Not Financial Advice” and “Do Your Own Research (DYOR),” legal experts suggest that these disclaimers may not absolve promoters from legal liability if the promoted project turns out to be fraudulent. 

Edsel Tupaz, a Partner at Gorriceta Africa Cauton & Saavedra, emphasized that such disclaimers cannot shield scammers from illegal schemes. Further, Rafael Padilla, a Blockchain Lawyer, stated that disclaimers are legally irrelevant if they are disingenuous and inconsistent with the promoter’s actions, citing instances where crypto coaches give financial advice immediately after using such disclaimers, even if they lack the necessary licenses.

(Read: Are Project Owners and Influencers Responsible for an NFT Rug Pull?)

This article is published on BitPinas: Filipino Influencers Promoting JPEX Step Back from Supporting the Exchange

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• Source: https://bitpinas.com/business/bitskwela-jpex/