COINFLEX PLANS TO RAISE FUNDS BY ISSUING A NEW TOKEN
The platform said it would begin issuing $ 47 million in so-called "Recovery Value USD" tokens on Tuesday. The resumption of withdrawals, aimed at June 30, will depend on the level of demand for new tokens.
"We've talked to so many private investors that we think at least half of the withdrawals will be registered," Mark Lamb, CoinFlex chief executive officer, told Bloomberg News in New York on Monday.
The sale of tokens is only valid for non-US investors, which are complex, according to the statement. Launched in 2019, CoinFlex is a small crypto exchange focused on exit trading. Exchange investors include Roger Ver, one of the most talked about Bitcoin Cash advocates.
CoinFlex halted withdrawals last Thursday after an unnamed counterpart, a high-value person with "large shares in a few unicorn private companies and a large portfolio" faced liquidity problems and failed to repay the debt.
Lamb declined to name its partners, although he added that CoinFlex believes the debt represents only "a small portion" of the company's total assets.
Temporary suspension comes amidst liquidity problems and infections throughout the industry. Major lenders Celsius Network and Babel Finance have suspended withdrawals, while Three Arrows Capital, a crypto hedge fund funder, is also facing liquidity issues that are plaguing investors.
CoinFlex said the party in question is not Three Arrows Capital or any other lending company. Although it would normally close any incorrect equity account, the user had a non-liquidation recourse account, according to CoinFlex. There are no other accounts that do not fit well, added.
In addition, CoinFlex has also said it is creating a new model of transparency at the edges after the withdrawal of the withdrawal. Prices for all future account positions will be made publicly available through an external research company, which is verified by the hour. They plan to release the details of the collateral held.