Kong based cryptocurrencies exchange Bitfinex has issued some very interesting updates regarding developments in handling the massive hacking that crashed the price of Bitcoin and it’s way forward.
The exchange said it site will be back in operation in a day or two, albeit in a reduced capacity, so that users can at least log in and see their accounts. But if you were worried that your entire holding with Bitfinex might be gone, they have some comforting news for you – the exchange decided to “generalize” the loses by giving all clients a 36.067% haircut across the board to cover for the affected bitcoin wallets.
Liquidity Constraints in 2021 – What is the Best Path Forward?Go to article >>
Additionally even the lost percentage might eventually be worth something as Bitfinex are crediting a token (labeled BFX) to record each wallet’s discrete losses which will be distributed to clients without release or waiver. The tokens will remain outstanding until redeemed in full by Bitfinex or possibly exchanged, upon the creditor’s request and Bitfinex’s acceptance, for shares of iFinex Inc – the BVI company which owns and operates Bitfinex. They caution: “We are actively discussing various strategic options with numerous potential investors as part of our strategy to fully compensate our customers. Such discussions, however, are in early stages and will likely take time to play out.”
The legal basis allowing for this approach has not been explained yet by Bitfinex but with the amounts of money involved and the negative responses by some in cryptocurrency community forums it is likely they will have to explain the issue in a court or to a financial regulator at some point in the future.