Open Exchange (OPNX) Offers $30 Million to Take Over Troubled Crypto Lender Hodlnaut

Open Exchange (OPNX) Offers $30 Million to Take Over Troubled Crypto Lender Hodlnaut

On August 6, Bloomberg reported that Open Exchange (OPNX), a platform specializing in crypto claims trading, has presented an offer to acquire the troubled crypto lender Hodlnaut. Last year, Hodlnaut filed for bankruptcy protection and is currently undergoing restructuring under the supervision of a Singapore court.

The proposed deal involves granting Hodlnaut $30 million worth of FLEX tokens as a partial payout to creditors and to settle outstanding claims. According to an unnamed source cited by Bloomberg, in return for this capital injection, Open Exchange would gain a 75% stake in Hodlnaut.

FLEX is the native token of CoinFLEX exchange, which was founded by Mark Lamb and Sudhu Arumugam, and they, along with Kyle Davies and Su Zhu, are the creators of OPNX. Davies and Zhu were co-founders of the now-defunct crypto hedge fund, Three Arrows Capital. Mark Lamb expressed optimism about the potential of the Hodlnaut platform and conveyed enthusiasm for closer collaboration.

However, the interim judicial managers of Hodlnaut raised objections when the directors of the firm directly emailed the OPNX bid to users. Subsequently, OPNX submitted the offer to the court, though its success remains uncertain.

As per the term sheet reviewed by Bloomberg, if Hodlnaut’s creditors approve Open Exchange’s proposal, they will have two options for payment. They can receive 30% of their claims in the form of FLEX and other tokens, or they may opt for a pro-rata payment of up to 95% of the total available corporate asset pool, whichever option yields a higher payout.

The backdrop to this acquisition attempt involves Hodlnaut encountering financial difficulties after the Terra-LUNA collapse last year, leading to a freezing of user withdrawals. Following this, the company sought bankruptcy protection and entered judicial management.

In January, major creditors of Hodlnaut rejected a restructuring plan in favor of liquidating the lender, as reported by Bloomberg. However, Hodlnaut founders Simon Lee and Zhu Juntao managed to convince creditors that selling the firm would be more beneficial to them than liquidation.

In April, Dubai authorities issued cease and desist notices to the founders of OPNX for operating an unlicensed exchange and engaging in unauthorized promotional activities. While Zhu and Davies were involved in launching the trading platform for tokenized bankruptcy claims, they clarified that they were not involved in its day-to-day management.

In addition, the liquidators of Three Arrows Capital have accused Zhu and Davies of non-cooperation in their investigation and seek to recover $1.3 billion from them.