Cryptocurrency

CoinFLEX co-founder accuses Roger Ver of betrayal in near bankruptcy saga

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CoinFLEX co-founder and CEO Mark Lamb said Roger Ver chose to betray CoinFLEX officials and users.

Lamb posted a video detailing his thoughts on the near bankruptcy of CoinFLEX by Ver, adding that brutal lessons have been learned.

CoinFLEX restructuring approved

In June 2022, CoinFLEX said it owed Ver $47 million due to margin losses incurred on Ver’s trading account. Lam explained that the company has a written agreement with Bar to personally guarantee negative trading balances.

The agreement required Ver to replenish his balance, which he failed to do, leaving a black hole in the exchange’s books. The Bitcoin Cash backer denied any wrongdoing and turned the situation around by saying CoinFLEX owes him money.

“Recently there have been rumors circulating that I have defaulted on my debts to the other party. These rumors are false. We are now seeking the return of funds.”

In July 2022, the exchange revised its original estimate to $84 million, adding that it was trying to recover the money through the courts.

An exchange file for the restructuring was filed the following month and was approved by the Seychelles Court in March, about seven months later.

The deal sees Lamb team up with Three Arrows Capital co-founders Su Zhu and Kyle Davis at CoinFLEX. rebranding OPNX – An exchange that specializes in tokenizing bankruptcy claims.

Ram tells his story

With the restructuring approved and winning “more than 20 different lawsuits” against Ver. lamb Recently took to social media to explain what happened.

On the issue of lending money to Ver/covering his trading losses with customer funds, CoinFLEX CEO said this did not happen, suggesting the incident boiled down to fraud on Ver’s part doing.

He explained that it is standard practice for some cryptocurrency exchanges to open “manual margin” accounts for VIP entities. These types of trading accounts offer a grace period, such as he 1 day, before a losing account that exceeds the margin limit is liquidated.

Manual margin accounts are commonly protected by external collateral, liens, personal guarantees, and other forms of collateral.

Lam, who disputed accusations of lax risk management, said he had a written margin agreement with Ver that he had not honored.

Additionally, the two have been best friends for 11 years, and given that they first met in the early days of Bitcoin, he suggested the situation was difficult to swallow.

During the process of building CoinFLEX and developing its product line, Lamb said: He often consulted Ver in a mentor and investor capacity. Over time, Ver owns more of his CoinFLEX equity than Lamb.

“He felt like a deeply engaged business partner we could trust…”

Lam said that even though much of CoinFLEX’s history and early success is due to Ver, it “chosen to betray the trust of so many people.”

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