After Months of Issues, Troubled Exchange CoinFLEX’s Restructuring Poised to Pass

CoinFLEX’s restructuring plan shows 99% approval from community

article-image

CoinFLEX | Source: Shutterstock

share

key takeaways

  • CoinFLEX paused withdrawals in June after a single client failed to meet a margin call, the exchange said
  • Fewer than one million tokens have been allocated to vetoing the plan

Months after unveiling its $47 million recovery token plans, troubled crypto exchange CoinFLEX is winning community support for its latest plan to save the company. 

CoinFLEX’s restructuring plan would give creditors 65% ownership. Existing ordinary and Series A shareholders will lose equity. Series B investors will continue to be shareholders, and 15% of the company will be reserved for an employee option plan that will vest overtime, CoinFLEX said in the proposal

Creditors will receive CoinFLEX recovery tokens, rvUSD, equity and FLEX coin, the company said. 

In June, a week after halting withdrawals due to an unnamed counterparty’s unmet margin call, the exchange announced that it was attempting to raise missing funds by issuing a new token, rvUSD, that will earn a 20% yield. 

“We’re turning a problem into an opportunity,” CEO Mark Lamb said at the time.

Since voting began Sunday, the restructuring plan has won approval from 96 million CoinFLEX vote tokens, according to Snapshot. Fewer than one million tokens have been allocated to vetoing the plan. The voting period ends Tuesday, Sept. 27 at 4:00 am UTC. 

The voting period comes a month after the exchange filed for restructuring in the Seychelles. 

If the plan moves forward under the current proposal, CoinFLEX will be keeping $10 million, the term sheet for the restructuring plan notes, an amount the team says will be crucial to move recovery efforts forward.

“The 10M isn’t only for the company’s operations, it’s also funding legal expenses related to rvUSD,” Lamb said in the CoinFLEX community Telegram group. “rvUSD would be significantly less valuable if that trust did not have meaningful backing behind it.” 

In terms of the plan being a done deal, Lamb was cautiously optimistic when speaking to token holders.

“I’m holding my breath,” he said in a Telegram message. “But it certainly feels that way, yes.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2023

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Cover Vertex.jpg

Research

The proliferation of new perp DEXs has led to fragmented liquidity across various DEXs and chains. Vertex, known for its vertically-integrated DEX that includes spot, perpetual, and integrated money markets, is now tackling cross-chain liquidity fragmentation through horizontal integration with the launch of new Edge instances. Vertex's integrated offerings and cross-margined account structure amplify the benefits of new instances: native cross-chain spot trading, optimized cross-chain basis trading, consistent interest rates, reduced bridging friction, and more.

article-image

Partnering with EtherFi and Angle, the fully on-chain perp DEX features bespoke collateral

article-image

Sponsored

Gavin Wood introduced the next evolutionary step for the Polkadot network: the Join-Accumulate Machine, or JAM

article-image

The side events were the places to be at Consensus 2024, according to attendees

article-image

Also, who’s come out swinging in the spot ether ETF fee war — and who could undercut them

article-image

I know it is not in their nature, but US regulators could learn a lot by researching the digital asset frameworks that overseas regulators have already gotten right

article-image

Also, the ETF hype train can count out at least one member