On July 15, the CoinFLEX crypto exchange will make 10% of funds on users’ balances active for withdrawal, unfortunately, the remaining 90%, although visible on the balance sheet, will not be available for use. However, users will still not be able to withdraw flexUSD coins. It should be noted that earlier the resumption of withdrawal of funds was scheduled for June 30, but this did not happen.
There are quite a lot of problems in the cryptocurrency world today, and not all projects are able to cope with the new conditions. More and more projects report their problems or partially suspend their work. As we wrote earlier, crypto exchanges are not having the easiest of times right now, as well as other major projects, for example, Celsius, are on the verge of bankruptcy.
The CoinFLEX exchange began its history in 2019. At that time, it became the world’s first futures exchange with physical delivery. And in 2022, the total volume of trading on the stock exchange exceeded $1 trillion. In July 2019, the exchange’s own coin FLEX Coin was launched. And in 2020, its own flexUSD stablecoin was released, the market capitalization of which exceeded $100 million in less than a year. At the time of writing this article, CoinFLEX, according to CoinMarketCap, is on the 164th place in the ranking of cryptocurrency spot exchanges and on the 21st place among cryptocurrency derivatives exchanges.
Currently, we see how the CoinFLEX crypto exchange is taking the first steps towards stabilizing its work and sharing plans for the future. But first, let’s refresh our memory on what caused the problems of CoinFLEX.
Apparently, the main problem with the stable operation of CoinFLEX was Roger Ver, who, according to the founders of the platform, did not fulfil the terms of his contract, which led to a debt of $47 million.
It is worth noting that at first CoinFLEX did not disclose the name of the “problem client”. It was known that the exchange issued a loan to the user on special terms, but with the development of the crisis, his special position became unprofitable. The exchange disclosed Ver only after he tweeted that he owed CoinFLEX nothing.
To fix the situation, CoinFLEX launched the Recovery Value USD (rvUSD) token. According to the team’s plan, the token should cover Roger Vera’s debt obligations. A total of 47 million tokens will be issued with a price of 1 USDC, which is equal to the amount of debt. To attract investors, the company offered an annual rate of return equal to 20%. It is also worth noting that CoinFLEX has a number of requirements for future buyers.
If you look closely at the abbreviated name of the coin, you will notice that it incorporates the initials Roger Vera — rvUSD. An interesting coincidence, isn’t it?
However, this decision was not welcomed by the community. For example, a Twitter user already familiar to us with his revelations, FatManTerra, criticized the actions of the exchange.
At the beginning of this article, we promised to tell you about the future plans that CoinFLEX shares with the community. In its appeal, the CoinFLEX team announced that it is negotiating with the American ATS platform.
«We are excited about this possible joint venture arrangement as this would result in the launch of a stock (US equities) repo markets and deliverable perpetual futures platform, leveraging CoinFLEX’s unique IP and technological platform. Securities lending is a $2.5 trillion market controlled by a small handful of prime brokers. We see great potential as there is no exchange platform for securities lending today.» -reported to CoinFLEX.
It is encouraging that CoinFLEX is making plans for the future and is not giving up at a time when the entire cryptocurrency market is experiencing turmoil. Currently, the digital economy is in its infancy, so similar mistakes can occur when a significant part of the exchange’s funds ends up in the hands of one client, who ultimately cannot pay off debts and jeopardizes the continued existence of the entire exchange. In a traditional economy, such situations are impossible because they are regulated by special rules. Let’s hope that CoinFLEX will be able to solve all its problems and return to its usual mode of operation. We will definitely be watching what is happening.