Open Exchange (OPNX), formerly CoinFlex, is currently acting like a hero as it has indicated an interest in acquiring assets which belong to bankrupt crypto lending firm Hodlnaut.
According to a Bloomberg report, the cryptocurrency exchange linked to Su Zhu and Kyle Davies, the founders of failed hedge fund Three Arrows Capital (3AC) plans to inject $30 million worth of FLEX digital tokens in Hodlnaut, whose restructuring is being overseen by a court in Singapore.
Mark Lamb, co-founder of CoinFLEX exchange said, “We see a lot of potential in the Hodlnaut platform and look forward to working closer with them.”
OPNX to Take 75% of Hodlnaut; FLEX Token Dips
It is believed that this capital injection will partially cover creditors’ payout and outstanding claims. At the same time, if this is approved by Hodlnaut creditors, it would give OPNX authority over 75% of the embattled exchange. While creditors would either get 30% of their claims which will be in FLEX and other tokens or a pro-rata payment of up to 95% of the available corporate asset pool.
It is not certain how the news may have impacted OPNX, but around the time of the initial announcement, the FLEX token was trading at $7.16, however, the crypto has seen an 11.41% decrease and is now trading at $6.65, based on data from CoinMarketCap.
The Downfall of Hodlnaut
Misfortune befell the Singapore-based digital currency lending startup last year amidst the cringing crypto winter that left many crypto exchanges bankrupt. Exactly a year ago, Hodlnaut suspended withdrawals on its platform citing unfavourable market conditions. Per a statement by the lending platform, the decision was necessary to stabilise its liquidity and preserve assets.
In no time, Hodlnaut began to seek judicial management to avoid forced liquidation which it finally received on August 29th with Ee Meng Yen Angela and Aaron Loh Cheng Lee, through EY Corporate Advisors Pte. Ltd., as the Interim Judicial Managers.
Hodlnaut Creditors Prefers Liquidation to Restructuring
It is not clear if Hodlnaut creditors will accept this OPNX proposal especially as most of them including Algorand Foundation, had earlier requested liquidation in place of a restructuring proposal. They came to this conclusion after it was discovered that the current directors would be responsible for running all of Hodlnaut’s operations during the restructuring process.
Meanwhile, 3AC co-founders Zhu and Davies are still being chased by creditors in the United States over their bankruptcy proceedings.