Crypto exchange CoinFlex, which has stopped user withdrawals since June 23, will not lift the freeze as originally planned on Thursday, the company’s CEO Mark Lamb told MarketWatch.
The exchange is trying to raise $47 million in USDC USDCUSD stablecoin.
Since Tuesday, the company has been through a token sale called Recovery Value USD, or rvUSD, to allow withdrawals to continue, the company said in a blog post on Monday.
CoinFlex said it expects token fundraising efforts to run for four days and conclude in the rvUSD whitepaper this Friday. The company’s blog post earlier this week states that the goal is to Continue to honor user withdrawals on Thursday, based on receiving funds from the rvUSD issuance.
crypto exchange He has been in talks with distressed debt funds, existing customers and investors about the token sale and is “making significant progress,” Lamb told MarketWatch. He declined to reveal how many tokens were subscribed, but said tens of millions of dollars were raised in “soft commitments.”
Lamb said the company will update the market with its fundraising status on Thursday and will “continue towards the settlement.”
CoinFlex’s withdrawal freeze came after crypto lenders Celsius and Babel Finance made similar moves as major cryptocurrencies BTCUSD ETHUSD crashed.
Tuesday, Lamb tweeted this Roger Ver, an early crypto investor, founder of bitcoin.com and vocal supporter of Bitcoin cash BCHUSD,
It failed to honor its financial commitments to CoinFlex, claiming that Ver owed 47 million USDC to the exchange. Ver is also an investor at CoinFlex.
To read: Crypto exchange CoinFlex says one of the most prominent names in the industry has defaulted on $47 million USDC debt.
drive tweeted on Tuesday He said that unfounded rumors spread that he defaulted on his debt to the other party. “Just as I do not owe this counterparty, this counterparty also owes me a substantial amount and I now want my funds returned,” Ver wrote. Ver did not identify the counterparty.
“I stand behind my original tweet,” Ver said in an email to MarketWatch when asked about Lamb’s allegations of default on Wednesday. “I will make more information public as soon as possible,” he wrote.
Lamb – and the white paper – pointed to the default of a large CoinFlex client as a catalyst for the platform’s liquidity woes. Lamb said he disclosed Ver’s identity as the relevant client due to Ver’s rejection in a tweet, but also cleared the air for the token issuance. “Since we disclosed these details, there has been a significant number of external potential buyers coming out of the woodwork because of who the counterparty is,” Lamb told MarketWatch.
rvUSD investors are essentially betting that the defaulter will pay the debt and associated interest to CoinFlex. can offer rvUSD token annual return of up to 20% over white paper.
The white paper also stated that if the company is not able to fully recover its obligations within 15 months, token holders have the option to be repaid directly through CoinFlex. When asked whether it would bring more risk to the stock market, Lamb said the company is still finalizing final terms with token buyers, while also saying that they are “very confident they can recover these assets.”
Lamb says CoinFlex remains in conversations with the default individual. We will also take all appropriate action we need to take to resolve this matter, but we are still talking to him and would like to reach an amicable agreement on this matter.”
Lamb said that CoinFlex chose to increase the tokens to continue honoring withdrawals because legal action options could be long and the situation could be “far worse in terms of the speed with which customers get some or all of their funds back.”
“In this case, through tokenization we are able to take users a different path, where ideally we can get all their funds back and this can be done quickly,” Lamb said.
CoinFlex’s native token FlexUSD is trading around $0.40 on Wednesday, down 30% from 24 hours ago and 60% from seven days ago, according to data from CoinGecko.