Following the launch of an arbitration process for the recovery of $84 million against an individual alleged to be “Bitcoin Jesus”, Roger Ver, CoinFLEX co-founders have proposed an interim plan to compensate depositors until the funds are recovered.
The derivatives exchange wants to allocate rvUSD, equity shares in CoinFLEX and FLEX Coin to depositors on a pro-rata basis.
It came up with creating markets for locked balances to be traded against unlocked balances. This will allow users who want more immediate liquidity on their frozen funds to exit/sell.
CoinFLEX stated in the announcement that it proposes this plan to be voted on by depositors and will most likely be adding depositors to the CoinFLEX Board of Directors covering: flexUSD holders; Crypto depositors; and smartBCH holders.
Co-founders Sudhu Arumugam and Mark Lamb proposed working with an auditing firm to collateralize all positions on CoinFLEX and lowering leverage limits, among other ideas to be discussed with the community.
When it comes to CoinFLEX’s troubled timeline, it began last month with the suspension of withdrawals after a specific individual’s account went into negative equity. CoinFLEX CEO Mark Lamb revealed the individual as prominent crypto investor Roger Ver, who denied the claim on social media.
Later this month, CoinFLEX opened the partial withdrawal limit for users to 10% of their account balance. It is pursuing legal action against the defaulter in the Hong Kong International Arbitration Centre (HKIAC).
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