Hong Kong-based digital asset exchange CoinFLEX has announced “significant” layoffs geared towards slashing its overhead by up to 60%.
In an announcement by its two founders, Sudhu Arumugam and Mark Lamb, the exchange revealed that it has been weighing every possible means to become more cost-efficient at a time when its finances have been massively hit by an $84 million margin call tie-up with Roger Ver.
“This means that we, unfortunately, had to let go of a significant number of the CoinFLEX team across all departments and geographies. The staff cuts and non-staff costs that we have made will reduce our cost base by approximately 50-60%,” the exchange announced.
The troubled exchange hinted at the possibility of an acquisition, pledging to monitor costs to ensure it operates as efficiently as possible “to remain right-sized for any entity considering a potential acquisition of or partnership opportunity with CoinFLEX.”
Meanwhile, it’s exploring areas such as new ways to list and launch perpetual swaps that are more “DeFi-like” in nature. It also plans on decentralizing its custody and margining data to increase transparency.
CoinFLEX grabbed headlines in June when it halted withdrawals for all its users, claiming at the time that it was just a “protective measure.” However, with major platforms like Celsius and Voyager Digital, which filed for bankruptcy, having started by halting withdrawals, CoinFLEX users were worried. It would later emerge that the person to blame for all the exchange woes was Ver, the self-proclaimed Bitcoin Jesus who was an early investor in the exchange.
Ver, a BCH proponent, had allegedly failed to honor his margin call obligations, which were worth $47 million at the time. However, due to changes in the market value of his tokens, this figure had almost doubled to $84 million. He has denied the claims and said that it’s CoinFLEX that owes him money.
In the latest development, CoinFLEX took up the matter with the Hong Kong International Arbitration Centre, an alternative dispute resolution institution. It expects the settlement to take at least 12 months. In the meantime, it’s encouraging depositors to roll some of their deposits into equity and seeking to raise funds from investors by introducing yet another token, rvUSD.
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