(Bloomberg) — A public dispute between a longtime crypto investor and a digital-asset exchange is the latest in a series of mini-crises that have rocked crypto markets in recent weeks.
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CoinFlex, a crypto exchange, on Tuesday named Roger Ver as the counterparty who failed to pay $47 million of stablecoin in a margin call. CoinFlex had previously disclosed a liquidity issue that led to the exchange pausing withdrawals. CoinFlex CEO Mark Lamb said in a tweet that the company served Ver, who is an investor in the exchange and was an early promoter of Bitcoin, with a notice of default.
“I have no debt to CoinFlex,” Ver told Bloomberg in an emailed statement. Later, he tweeted that “some rumors have been spreading that I have defaulted on a debt to a counter-party,” without naming CoinFlex specifically. Ver said the rumors weren’t true, instead saying the counterparty owed him “a substantial sum of money, and I am currently seeking the return of my funds.” Lamb in turn responded on Twitter, saying Ver’s tweet is factually incorrect and CoinFlex owes him no funds.
A broad-based selloff in digital assets and the collapse of high-profile tokens have caused ripple effects across the industry. Major lenders Celsius Network and Babel Finance have frozen withdrawals, and Three Arrows Capital, a crypto hedge fund, is also facing liquidity troubles that have rattled investors.
Read More: Crypto’s $2 Trillion Shakeout Portends Lehman Moment
CoinFlex on Monday announced a plan to make up the shortfall triggered by the default by issuing a new token that will offer a 20% annual return. The resumption of withdrawals, targeted for June 30, will depend on the level of demand for the new tokens.
Ver earned the nickname “Bitcoin Jesus” for proselyting about the world’s largest cryptocurrency in its early days. He has invested in several Bitcoin-related startups, and has become one of the most vocal advocates of Bitcoin Cash. He is co-founder and investor at Blockchain.com, a crypto wallet and an exchange which recently raised a round of funding. In a YouTube video last year with Lamb, Ver discussed the yield earning opportunities at CoinFlex.
Founded in 2019, CoinFlex is a smaller crypto exchange focusing on derivatives trading, with less than $200 million in total value locked, according to its website.
In a previous update, CoinFlex said while it would typically liquidate any negative equity account, the client at issue had a non-liquidation recourse account. No other accounts are in negative equity, it added.
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Crypto hedge fund Three Arrows Capital (3AC) has entered liquidation, a person familiar with the matter told Reuters on Wednesday, in the latest sign of the market downturn hurting the crypto industry. Singapore-based 3AC is one of the higher profile crypto investors to have run into difficulties following the sharp sell-off in the market for digital currencies seen in recent months. Crypto broker Voyager Digital issued 3AC with a default notice on Monday after it failed to make payments on a loan of 15,250 bitcoin (approximately $324 million) and $350 million worth of USDC, a stablecoin.
Early Bitcoin adopter and Bitcoin Cash promoter Roger Ver has denied defaulting on a US$47 million loan in USDC to beleaguered cryptocurrency exchange CoinFLEX. See related article: CoinFLEX to issue US$47 mln in tokens as it waits for ‘crypto whale’ to pay up Fast facts Ver tweeted overnight in Asia time that rumors of the […]
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The disagreement stems after CoinFLEX said it was launching a recovery token as a high net worth customer owed the exchange.
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