Wednesday, 28 February 2024

Crypto News

CoinFLEX creditors dissatisfied with restructuring to OPNX: Report

CoinFLEX creditors dissatisfied with restructuring to OPNX: Report

Some creditors of cryptocurrency futures exchange CoinFLEX are alleging that OPNX, a new crypto exchange established in part by Three Arrows Capital (3AC) co-founders Kyle Davies and Su Zhu, was created using CoinFLEX assets without their consent. 

According to a writ of summons filed in the High Court of Hong Kong and seen by Cointelegraph, CoinFLEX creditors claim that OPNX co-founder and former CEO Mark Lamb is “misappropriating and/or otherwise wrongfully using the assets, human resources, intellectual properties, […] trade secrets and other technologies” of CoinFLEX by diverting them into OPNX. It alleges that Lamb performed these actions contrary to his responsibilities to CoinFLEX creditors during his tenure. 

Citing the document, creditors say that Lamb devoted “time, attention, skill and/or effort” to setting up OPNX while simultaneously being employed as the CEO of CoinFLEX.

The document claims that the former CEO diverted clients and business opportunities to the rival exchange, misappropriated assets that belonged to the creditors, falsely represented that OPNX was associated with CoinFLEX creditors, divulged confidential trade secrets to third parties, solicited employees and contractors to move to OPNX, forged a fake nondisclosure agreement between himself and a third-party, and engaged in other actions that harmed the creditors.

According to a creditor who spoke with Cointelegraph, CoinFLEX’s terms of service required users to settle disputes through arbitration in Hong Kong, which is why the creditors have pursued legal action in Hong Kong instead of Seychelles, the firm’s place of domicile. The allegations have not been proven in the High Court of Hong Kong.

The plaintiffs listed in the document are two companies: Liquidity Technologies and Liquidity Technologies Software. According to Crunchbase data, the first is the Seychelles-based legal entity under which CoinFLEX originally operated. The document lists Mark Lamb, crypto investor Roger Ver, Open Technologies Holdings, and Open Technology Markets as defendants. Open Technologies holdings and markets are two companies the document claims are associated with the OPNX crypto exchange.

List of plaintiffs and defendants in Writ of Summons. Source: Hong Kong High Court.

In January, a pitch deck for OPNX was leaked to the public and was later confirmed by the founding team as authentic. The deck listed Davies and Zhu, Mark Lamb, and Sudhu Arumugam as OPNX co-founders. In…

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