CoinFLEX to Seychelles

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CoinFLEX intends to restructure in Seychelles for $84 million

CoinFLEX to Seychelles
CoinFLEX to Seychelles / Image Credit: CRYPKYP
Source: Decrypt
1660136373 10 Aug / 12:59

Cryptocurrency derivatives market Bloomberg reports that CoinFLEX is seeking a swift resolution to its most recent legal issues by filing for reorganization in a Seychelles court.

The exchange wants clearance from depositors and the court for its proposal to provide depositors with rvUSD tokens, shares, and a locked version of the platform's native token, FLEX coin, to pay off its debt.

Tuesday, CoinFLEX emailed clients about its reorganization, according to the report. "We are pleased to be in a country where we can promptly address this matter and restore maximum value to depositors," CoinFLEX CEO Mark Lamb told Bloomberg.

End of June, CoinFLEX banned withdrawals from its platform, claiming “extreme market circumstances” and “continuing counterparty concern.”

The exchange eventually identified this counterparty as Roger Ver, an early Bitcoin (BTC) pioneer, investor, and Bitcoin Cash (BCH) proponent. It accused him of defaulting on a $47 million loan, which Ver himself disputes.

This amount was eventually revised to $84 million, with CoinFLEX and Ver entering arbitration in a Hong Kong court.

The exchange has developed a similar obligation in the form of a liability token called “Recovery Value USD” (rvUSD), which it plans to sell to offset a deficit caused when “a specific high net worth individual” failed to supply the requisite liquidity to fulfill his margin call.

Since then, CoinFLEX has made 10% of user cash withdrawable, but the remainder of client deposits remain unavailable.

To decrease expenses, the exchange also announced a reduction in the workforce last week, affecting “a large portion of the CoinFLEX team across all departments and regions.”

The firm stated at the time that it intended to stay appropriately scaled for any organization considering a potential acquisition or partnership opportunity with CoinFLEX.

In addition to finishing the instruments required to solve what CoinFLEX refers to as “the imbalance between our accessible assets,” the exchange wants to construct the so-called “Locked Balances Markets,” which would be traded against the platform’s unlocked balances.

According to a recent corporate blog post, consumers who need more rapid liquidity on their frozen assets will be able to abandon their positions or sell them to customers interested in the suggested recovery plan incorporating the rvUSD token, equity, and the FLEX currency.

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