Beleaguered cryptocurrency exchange CoinFLEX has reportedly initiated a restructuring process in a Seychelles court.

tokens, coinflex, crypto, cryptocurrencies, roger ver, exchanges

Crypto derivatives exchange CoinFLEX is seeking a quick resolution to its latest legal troubles as it files for restructuring in a Seychelles court, according to Bloomberg.

The exchange, which intends to raise $84 million to pay off its debt, seeks approval from depositors and the court on its proposed plan to issue depositors with rvUSD tokens, equity, and a locked version of the platform's native token FLEX coin.

Per the report, CoinFLEX informed customers of its restructuring process via email on Tuesday.

“We look forward to welcoming a new group of shareholders to CoinFLEX and are glad to be in a jurisdiction where we can quickly resolve this situation and return maximum value to depositors,” CoinFLEX CEO Mark Lamb told Bloomberg.

The CoinFLEX saga

CoinFLEX halted withdrawals from its platform at the end of June, citing “extreme market conditions” and “continued uncertainty involving a counterparty.”

The exchange later identified that counterparty as the early Bitcoin (BTC) pioneer and investor turned Bitcoin Cash (BCH) promoter Roger Ver accusing him of defaulting on a $47 million loan—something that Ver himself denies.

That figure was later updated to $84 million, with CoinFLEX entering arbitration with Ver in a Hong Kong court.

The exchange also created a corresponding liability in the form of a liability token called “Recovery Value USD” (rvUSD), which it intends to sell to resolve a shortfall created after “a certain high net worth individual” failed to provide the liquidity required to meet his margin call.

CoinFLEX has since made 10% of user funds available for withdrawals, although the majority of customer deposits remain inaccessible.

Last week, in a move aimed at cutting costs, the exchange also announced a staff reduction that affected “a significant number of the CoinFLEX team across all departments and geographies.”

“The intention is to remain right-sized for any entity considering a potential acquisition of or partnership opportunity with CoinFLEX,” the company said at the time.

As for the proposed restructuring, in addition to finalizing the instruments necessary to address what CoinFLEXcalls “the mismatch between our available assets,” the exchange also plans to create the so-called “Locked Balances Markets”—those would be traded against unlocked balances on the platform.

The idea, as the company laid out in a recent blog post, is that users who want more immediate liquidity on their frozen funds can exit their positions or sell them to customers that are interested in the proposed recovery plan involving the rvUSD token, equity, and the FLEX coin.

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