Bitcoin expression. (Reuters / Benoitessier / File photo)
CoinFlex has taken legal steps to recover a $ 84 million loss from a single customer and is in talks to sign a joint venture with another crypto exchange to revive its property. Said that.
Cryptocurrency exchanges suspended withdrawals on the platform last month after a counterparty identified with long-time crypto investor Roger Ver was unable to repay $ 47 million from margin calls.
CoinFlex said in a blog post on Saturday that after calculating the final aggregate of losses from “significant” positions on the exchange’s native FLEX tokens, the total amount payable by investors has increased. The blog post doesn’t mention the name of Ver.
“It’s clear that he wasted his time and wanted a bounce in the market that didn’t happen,” CoinFlex co-founders Sudhu Arumugam and Mark Lam said in a Saturday post.
The pair said CoinFlex has begun arbitration proceedings in Hong Kong to recover $ 84 million. This process can take up to about 12 months before a judgment is made.
Barr, who earned the nickname “Bitcoin Jesus” in his early investment in cryptocurrencies, declined to comment on the case. He told Bloomberg last month that he had no outstanding debt with Coin Flex. He was “a considerable amount of money”.
CoinFlex is one of several crypto platforms struggling to operate in the midst of a massive market downturn that wipes out about $ 2 trillion from the total amount of cryptocurrencies, with some players suspending their withdrawal. Or filed for bankruptcy. The crisis has exposed the net of transmission to the entire sector. There, the failure of one company causes a domino effect on many others.
In a blog post, Sudhu and Lamb are planning to raise enough external funding with USDC (a stablecoin tied to the value of the US dollar) to make up for the lack of liquidity and resume withdrawals. Said. This includes asking some customers if they can support their business by “passing some of their deposits to equity.”
CoinFlex is also in talks with a “large US exchange” about entering the joint venture after the funding process is complete, they said. Futures, first through an offshore license before immigrating to the United States.
At this point, CoinFlex aims to be able to withdraw 10% of its customer’s balance within a week, Sudhu and Lamb added.
“This isn’t the position we’ve ever imagined,” they wrote in a post.
Founded in 2019, CoinFlex is a small cryptocurrency exchange focused on derivative trading. On Saturday, a total of about $ 145 million was locked to the platform.