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Cryptocurrency derivatives platform CoinFLEX will launch the Recovery Value USD (rvUSD) token. With his help, the company hopes to pay off a “rich” private client and continue the
Cryptocurrency derivatives platform CoinFLEX will launch the Recovery Value USD (rvUSD) token. With his help, the company hopes to pay off a “rich” private client and continue the withdrawal of user funds.
Hello everyone, we share our latest update on the plans to re-enable withdrawals on the platform
https://t.co/34brwoDYuL
— CoinFLEX (@CoinFLEXdotcom) 27 June 2022
rvUSD, Liquidity Technologies Ltd. It is a token issued by (“CoinFLEX”). “This is about the outstanding debt of a certain high-net-worth individual to CoinFLEX,” the whitepaper published by the company says.
On June 24, the platform suspended the withdrawal of user funds due to “extreme market conditions” and “counterparty uncertainty”. Then the company’s president, Mark Lamb, stressed that the latter is not a Three Arrows Capital (3AC) hedge fund or “any lender”.
On June 27, Lamb said the company was in trouble because of a “long-time” customer who was given credit on unique terms. There is no liquidation price for its position – it provides liquidity to the platform in return. However, his position became unprofitable against the background of the crisis.
“We want to emphasize that this person is a highly intelligent person with substantial funds who has been experiencing temporary liquidity problems due to the credit (and price) crisis in the cryptocurrency and traditional markets. This person has substantial stakes in several private unicorns and a large portfolio of securities,” Lamb wrote.
By issuing rvUSD, the platform aims to meet the debt obligations of the client and continue the withdrawal of funds. The company will issue 47 million tokens at a price of 1 USDC.
Experienced investors, excluding US residents, can participate in the token sale. Applicants must have an annual income of at least $200,000 and a net worth of $1 million.
The minimum subscription size is 100,000 USDC.
To attract participants to the token sale, the platform has set the instrument’s annual rate of return at 20%. The CoinFLEX treasury has also allocated 2.5 million FLEX (~$2.67 million at the exchange rate at the time of writing) – after the “whale” pays off the debt, the coins will be distributed among rvUSD holders.
The company plans to resume withdrawals on June 30.
Recall that cryptocurrency broker Voyager Digital sent a default notice to the 3AC hedge fund due to non-payment of a loan.
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