CoinFlex to resume withdrawals after raising funds via new token issuance
Cryptocurrency exchange CoinFlex will resume withdrawals after issuing a new token (called Recovery Value USD (rvUSD)). This provides users with 20% annual revenue. White paper June 27th.
CoinFlex will issue $ 47 million worth of rvUSD from June 28th to address liquidity issues, withdrawals will resume by June 30th in response to demand for new tokens. I’m expecting it.
According to the announcement, only sophisticated investors outside the United States can participate in the token sale.
CoinFlex CEO, Mark Lamb, Said Bloomberg News:
I’ve talked to quite a few private investors and I think at least half of the issues will be subscribed.
When asked about the possibility of a run, Ram said this was very unlikely, as customers could withdraw funds shortly after the token-issuing funding was completed.
A decision will be made a few days after CoinFlex has become the latest crypto company to stop withdrawing. We stopped withdrawals because wealthy clients were unable to repay their $ 47 million debt.
The CoinFlex exchange focused on derivative trading last Thursday, suspending its withdrawal and facing liquidity issues for individuals with “substantial equity holdings in some unicorn private companies and large portfolios” And claimed that he could not repay the debt.
The CEO didn’t reveal his personal name, but CoinFlex said he believes this responsibility is only a small part of the counterparty’s assets.
According to the company, the other party is not a lending company. CoinFlex said:
Under normal circumstances, we will automatically clear positions that are short of equity at prices prior to the zero equity price.
However, this particular user has the option of not clearing the account. He added that no other account has negative capital.
Cryptocurrency companies are fighting liquidity issues
The crypto industry liquidity issue is gradually becoming a transmission issue for some companies and exchanges that have suspended their withdrawal.
Three Arrows Capital, Babel Finance and Celsius Network face similar issues.
CoinFlex, meanwhile, added that it would be more transparent after the drawer was restored. The new transparency model includes publishing futures positions for all accounts, publishing collateral information held, and working with external audit firms.
