CoinFLEX CEO Mark Lamb joins Emily Chang and Bloomberg’s Sonali Basak to discuss CoinFLEX’s recent pause of withdrawals following others in the crypto space having liquidity troubles and how they intend on fixing it in the near term with a newly-launched token. Plus, what he thinks needs to happen for long-term transparency around future margining. (1)
Cryptocurrency (virtual currency) exchange CoinFLEX announced on the 28th that it is trying to raise about 47 million dollars by issuing a token called “recovery value USD” (rvUSD).
As a background, CoinFLEX has suspended all withdrawals and transactions of its token FLEX from the 23rd. Thirty days was mentioned as a guideline for the days when withdrawals are possible.
The measure stems from “last week’s extreme market environment and the continued uncertainty of counterparties. ” Specifically, the cause was that a third-party wealthy person with “multiple unicorn company stocks and a large portfolio” was unable to repay its debt due to liquidity problems.
According to CoinFLEX, the wealthy man was credible, but the recent price contraction in the cryptocurrency market has temporarily put him in a position of liquidity problems.
Recently, the Stablecoin UST Dipeg turmoil in May has caused the cryptocurrency hedge fund three arrows of capital to default, and the cryptocurrency lender Celsius Network has stopped withdrawing customer funds.