Dominic Rivers spotted an opportunity to make money last month from low bitcoin prices. Now he's wondering if he will see his investment again.
The Briton, 34, says he saw the bitcoin as a "novel and revolutionary approach to finance".
"The idea of cutting out the middle man sounded good - an efficient approach to finance in the modern world," Rivers added.
He was attracted by the US$25 million investment Hong Kong Crypto Exchange (HKCex) claimed to have raised from "private funds" in China and Hong Kong.
The company's announcement came a day after Bitpay, a Paypal for digital currencies, announced a successful US$30 million fund-raising effort with backers like Asia's richest man, Li Ka-shing, and British billionaire Richard Branson.
Rivers thought Crypto Exchange was a serious player, right on his doorstep.
Cautious nonetheless, he did some more research and pronounced HKCex a "pretty impressive" operation.
But after transferring his bitcoins into the company, Rivers tried to swap them for US dollars on May 16. The company said it would take three days for the withdrawal to clear a security check.
"I didn't want to wait that long, and it made me a little nervous, since they said on the website it would be done in 24 hours."
His subsequent attempts to withdraw bitcoins and Hong Kong dollars, to avoid the delay, were also unsuccessful.
Then HKCex's website went offline suddenly, claiming to have been subject to a distributed denial-of-service (DDoS) attack.
Rivers' experience in IT made him familiar with such incidents. He suggested the attack was "feasible" but "since it happened so much within exchanges, I would have expected them to have learned from other exchanges".
The company then accused customers of money laundering, saying they had to prove their identity or risk losing cash or bitcoins.
"We have a suspicion that your account is being used for money laundering," said Chi Xu, from the HKCex financial department, in an e-mail to Rivers.
"To confirm your account is in accordance with the policy of KYC [Know Your Customer fraud safeguards], we ask you to send a notarised copy of your passport."
Since Rivers wanted to withdraw in US dollars, he understood American regulations required such information.
"I still want to believe they are a real company. But I'm very concerned, very suspicious about the lack of transparency in their communications. Either these guys are stealing my money or they are very amateur."Topics: Bitcoin More on this: