Cryptocurrency exchange CoinFLEX said it has cut a “significant number” of team members in an effort to reduce operating costs.
According to a Friday blog post, CoinFLEX said he had cut some staff in “all departments and geographies” as part of measures to cut the company’s costs by 50% to 60%. The majority of the remaining team members will focus on product and technologyand the exchange said it would consider scaling up as “volume returns”.
“The intent is to remain the right size for any entity considering a potential acquisition or partnership opportunity with CoinFLEX,” the exchange said.
On Saturday, CoinFLEX halted withdrawals after an anonymous party allegedly failed to meet a $47 million margin call. CEO Mark Lamb then took to Twitter to confirm rumors that CoinFLEX had a written contract with Bitcoin Cash (BCH) promoter Roger Ver “requiring him to personally guarantee any negative balance in his CoinFLEX account and to top up his margin regularly.” Ver a refused the exchange complaints.
Roger Ver owes CoinFLEX $47 million USDC. We have a written contract with him requiring him to personally guarantee any negative balance in his CoinFLEX account and to top up his margin regularly. He has been in default of this agreement and we have served notice of default.
—Mark Lamb (@MarkDavidLamb) June 28, 2022
Although CoinFLEX partially reopened user withdrawals on July 14, many users expressed concerns about the liquidity of the exchange among other insolvency issues with Three Arrows Capital, Voyager Digital and Celsius Network. Estimates later suggested that CoinFLEX’s shortfall could be as high as $84 million, for which the company has commenced arbitration proceedings in Hong Kong.
Following the cessation of withdrawals, CoinFLEX initially announced its intention to address its liquidity shortage by issuing a new token, Recovery Value USD (rvUSD). Although no tokens have been released at press time, the exchange said on Friday that it still plans to move forward with the stimulus package:
“We continue to work with attorneys and the large group of creditors on the details of the distribution of the Composite CoinFLEX (including rvUSD, stocks and FLEX Coin) and expect to have numbers next week so that we can put that to a vote of all applicants as soon as possible thereafter.”