CoinFLEX to issue US$47 mln in tokens, awaits ‘crypto whale’
The crypto derivatives trading platform that halted withdrawals last week will issue the tokens that can be swapped into USDC or its own coin.
See related article: Crypto winter ushers in account freezes as platforms feel the chill
Fast facts
- CoinFLEX is issuing “rvUSD” tokens towards an outstanding debt owed by an unnamed high-net-worth individual, the exchange said.
- Under an agreement with the exchange, the longtime customer has personally guaranteed to make up for any shortfall in his account to avoid being liquidated in a market downturn.
- The individual is a “high integrity person of significant means” with “significant shareholdings” in several unicorn private companies and a large portfolio, CoinFLEX said. The individual is “experiencing temporary liquidity issues due to a credit and price crunch in markets,” it added.
- Investors will be able to swap their tokens into USD Coin (USDC) on a one-on-one basis. If the repayment takes more than 15 months, they can opt to convert their tokens into a mixture of USDC and FLEX Coins or wait for full repayment in USDC.
- Token holders will be paid an annual interest of 20% in rvUSD daily, CoinFLEX said.
- If the individual defaults, CoinFLEX will pay back token holders out of its balance sheet, with 2.5 million units of FLEX Coins being set aside for this issuance.
- CoinFLEX had halted withdrawals due to extreme market conditions and uncertainty involving a counterparty.
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