CoinFLEX exchange platform is acting swiftly to recover much liquidity from a recent crisis. The company is currently short of $84M due to funds owed by an anonymous whale.
The co-founders noted that liquidating the client’s FLEX token position has caused huge slippage. This has increased the amount the client owes the firm.
The native token of CoinFLEX platform is called FLEX. The initial amount was $47M, but that has increased to $87M. The statement added that:
“Unfortunately, this user did not uphold his end of the bargain as stated in the written agreement. Our attorneys have started legal proceedings to recover the money. This is in accordance with the agreement because they think we have a very good case.”
CoinFLEX Moves To Recover $84M
CoinFLEX, a cryptocurrency investment platform, is continuing with its strategy to sue a single account holder in Hong Kong for $84 million. On July 9th, co-founders Mark Lamb and Sudhu Arumugam gave more info about their strategy.
They said the ruling would give them access to the individual’s “global assets.” Also, their attorneys were very optimistic that they could execute the judgment.
According to the company, the individual has a legal responsibility to pay the funds under the contract. Unfortunately, the person has failed to do so.
Therefore, the firm has started arbitration in the HKIAC for the payment of this $84 million. However, CoinFLEX did point out that the procedure to get a verdict in Hong Kong may take a year.
After that, they can execute that decision against his other international assets. Meanwhile, Lamb had previously stated that Roger Ver was the defaulting client.
Roger Vash is a famous supporter of Bitcoin Cash. However, Lamb did not specifically identify him as the individual in the release on July 9th. Moreover, Ver has denied having any unpaid debts to the firm.
Lamb and Arumugam said that the client was wasting time by offering to top off his account with money that never materialized.
CoinFLEX Halts Withdrawals
Since June 23rd, CoinFLEX has paused withdrawals on its platform. This is due to the conflict between the company and the unknown whale account. However, Lamb noted that by July, he intends o get them back up for users.
According to Lamb and Arumugam, they want to give CoinFLEX depositors “temporary liquidity.” This would permit them to withdraw 10% of their balances at first till withdrawals return.
Besides, the co-founders anticipate withdrawals to return in a week or less. However, there is no definite timeframe for when this will happen.
Furthermore, the whale’s account created a cash shortage on the exchange platform. As a result, CoinFLEX has been looking for methods to make up for it.
In June, the platform said part of the fund’s recovery technique included releasing 47M Recovery Value USD (rvUSD) tokens. Users can purchase these tokens for $1.00 apiece.
This was in addition to liquidating accounts and taking legal action. Additionally, it could allow some depositors to convert their funds into stock in the business.
Following the news of the lawsuit, the value of FLEX dropped by 71% on Saturday to about $0.27. As per CoinGecko, it is presently trading at $0.28.
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