On Tuesday, the troubled Cryptocurrency exchange, CoinFlex, filed for restructuring in a Seychelles court to resolve a shortfall due to a counterparty failing to make a margin call.
The company sent out a notice of its restructuring process in emails to customers on Tuesday. It will seek approval from depositors and the court on a proposal to issue depositors with rvUSD tokens, equity, and locked FLEX Coin.
“We look forward to welcoming a new group of shareholders to CoinFLEX and are glad to be in a jurisdiction where we can quickly resolve this situation and return maximum value to depositors,” CoinFLEX CEO Mark Lamb told Bloomberg.
CoinFlex freezes withdrawals
The restructuring filing comes at a time when the company has just sold its token FLEX Coin (FLEX). CoinFLEX blocked its Crypto withdrawals seeking to recoup $84 million citing “extreme market conditions and continued uncertainty involving a counterparty,” identified by CoinFLEX CEO Mark Lamb as prominent investor Roger Ver, an accusation which Ver tossed.
“Not only do I not have a debt to this counter-party, but this counter-party owes me a substantial sum of money, and I am currently seeking the return of my funds,” Ver said in a tweet on June 28.
Coin flex also said it was raising money to clear its $47 million bad debt and was lobbying investors to meet the margin. Later this month, they coinflex open its withdrawals to 10% , raising hopes the the company was standing on a solid ground .
Huge Layoffs, Record Withdrawals
CoinFLEX is also pursuing legal action against the defaulter Roger Ver in the Hong Kong International Arbitration Centre (HKIAC) but could take up to a year to get a judgment and enforce it against Ver’s assets