Tokenize Xchange Founder Sued as Users Chase $205m in Missing Crypto

A collective lawsuit has been filed in the Singapore High Court by 272 former customers of now-defunct cryptocurrency exchange Tokenize Xchange, targeting its founder Hong Qi Yu and his wife, chief operating officer Erin Koo Kee Hoon. The claimants allege that more than $200 million in customer assets went missing, leaving many users with what they describe as their “entire life savings” wiped out.

The Lawsuit: 272 Customers, Tens of Millions in Claims

Court filings reviewed by multiple outlets show that the representative action seeks around $46.65 million in damages. This figure reflects the value of crypto assets that the group held on Tokenize Xchange as of 31 July 2025, or on the dates when they attempted to withdraw their funds but were unable to do so.

The suit names:

• Hong Qi Yu – founder and CEO of AmazingTech, the company that operated Tokenize Xchange
• Erin Koo Kee Hoon – Hong’s wife and the platform’s chief operating officer

The plaintiffs accuse the pair of fraudulent misrepresentation and fraudulent misappropriation of customer assets, and say they were misled about how their funds would be held, traded and safeguarded on the platform.

Massive Shortfall: Over $205m Owed, Only $2m in Assets

The lawsuit builds heavily on findings by court-appointed interim judicial managers overseeing Tokenize Xchange’s operator, AmazingTech. Their report concluded that:

• The company owed users roughly $205 million in total.
• Its realisable assets were only about $2 million.
• This left an unexplained shortfall of more than $203 million in customer assets.

For affected investors, the revelation that the company appeared to hold less than 1% of customer assets came as a severe shock. Lawyers representing the group say many clients have effectively lost their entire crypto holdings on the platform.

Allegations: Misused Order Books, Commingled Funds, Misleading Assurances

Beyond the missing money, the lawsuit alleges a series of deceptive business practices by Tokenize Xchange and its leadership, including:

• Misleading trading set-up: Instead of matching user orders on an independent order book, Tokenize allegedly executed trades directly between the exchange and its users.
• Use of an external order book: The “central limit order book” displayed on Tokenize Xchange was allegedly mirrored from another major exchange (reported as Binance), with spread mark-ups, creating the impression of deep liquidity.
• Commingling of funds: Despite contractual promises that user funds would be held separately in trust, company monies and customer assets were allegedly commingled.
• Licence and jurisdiction claims: Users were told that Tokenize had secured or was close to securing regulatory licences in Labuan (Malaysia) and the Abu Dhabi Global Market, but subsequent reports suggested little or no substantive progress had been made, with some plans collapsing amid other allegations.

Regulatory Backdrop: MAS Rejection, Police Probe and Collapse

Tokenize Xchange’s troubles escalated in mid-2025 when Singapore’s Monetary Authority of Singapore (MAS) rejected its application for a Major Payment Institution licence for digital payment token services. The platform had previously operated under a regulatory exemption.

Following the licence rejection:

• Tokenize announced it would cease operations in Singapore and initiated a phased withdrawal process for users.
• Many customers subsequently reported being unable to withdraw assets, with withdrawal requests stuck “in transit”.
• Singapore’s police and MAS launched a fraud and fraudulent trading probe into AmazingTech and related entities.
• Hong was separately charged with fraudulent trading under local law.
• AmazingTech was placed into interim judicial management, and later wound up by order of the High Court.

Investors Say They Were Blindsided

Many Tokenize Xchange customers say they were long-time users of the platform and had not previously experienced problems with trading or withdrawals. Some deliberately chose the Singapore-based exchange believing its local presence and licensing ambitions implied stronger oversight and safety.

The sudden combination of:

• Licence rejection by MAS,
• Trading and withdrawal suspension, and
• Judicial-manager findings of a huge asset shortfall

has left a large number of users stuck in limbo, now relying on the collective lawsuit as their primary avenue to attempt recovery of at least part of their lost funds.

Wider Lessons: Counterparty Risk in Centralised Crypto Platforms

The Tokenize Xchange saga is another reminder of the structural risks in centralised crypto exchanges, especially where:

• Client funds are not transparently segregated and independently verified.
• Trading does not occur on-chain or on transparent order books.
• Regulatory status, licences and asset-protection mechanisms are opaque.

For regulators and policymakers, the case adds to pressure for tighter custody, auditing and disclosure rules in digital-asset markets, alongside more robust enforcement where representations to clients differ from reality.

Key Case Highlights

• 272 former customers file a representative action in Singapore.
• Lawsuit targets founder Hong Qi Yu and COO Erin Koo.
• Judicial managers: about $205m owed to users, only around $2m in assets.
• Plaintiffs seek roughly $46.65m in damages as a first step.
• Allegations include fraud, misrepresentation, commingling of funds and misleading claims on licences and trading structures.

About Shunyatax Global: Shunyatax Global offers in-depth coverage of cross-border tax, digital-asset regulation and financial-crime enforcement worldwide. For expert insights on crypto compliance, exchange risk and regulatory investigations, visit Shunyatax Bookkeeping Services and explore our analysis, intelligence and advisory services.