CoinFlex addresses ‘extreme market conditions’ using this solution

ambcrypto.com:

In the past few months, ‘extreme market conditions’ has grown to become the most heard phrase in the crypto-assets ecosystem. Since the beginning of June, platforms including Celsius, Babel Finance, Voyager Digital, and Finblox have altered their mode of operations owing to the broader market drawdown. 

In a ripple effect, On 23 June, Futures cryptocurrency exchange CoinFLEX paused its operations. In an announcement blog published by the company, Mark Lamb, the Exchange’s CEO stated,

“Due to extreme market conditions last week & continued uncertainty involving a counterparty, today we are announcing that we are pausing all withdrawals. We fully expect to resume withdrawals in a better position as soon as possible. We will fully communicate with you as we find out more.”

The exchange pegged its estimated time of recommencing withdrawal to 30 June. And, Mark Lamb reconfirmed this in a recent interview with Bloomberg.

Interestingly enough, on 27 June, the exchange published a recovery plan, “CoinFLEX’s Tokenization Solution to Resume Withdrawals and Normal Operations.” This would involve the launch of a new recovery token called Recovery Value USD (rvUSD).

According to the announcement, the exchange ran into liquidity issues. This was due to the account of a ‘long-time customer of CoinFLEX’s that ran into negative equity.’ The company’s CEO also mentioned that under normal circumstances, the platform would automatically liquidate any such position.

However, in the case of this individual, there existed a “non-liquidation recourse account.” This prevented the account from being liquidated because of a pre-existing personal guarantee that the account owner had pledged. 

Now, to resolve the issue, the exchange intended to monetize