Hodlnaut, which found itself in dire straits, faced another twist as its interim judicial managers rejected a $30 million buyout offer from cryptocurrency exchange OPNX, reported Bloomberg.
The deal fell apart amid a catastrophic 90% plummet in the settlement token’s value.
Hodlnaut had its administrators firmly opposing the takeover terms presented by OPNX, a cryptocurrency exchange launched by Kyle Davies and Su Zhu, co-founders of the now-defunct hedge fund Three Arrows Capital (3AC).
In a recent court filing, the interim managers didn’t mince words. They argued that the $30 million offer of Flex [FLEX] tokens was “illiquid” and burdened with “speculative value.”
Notably, a significant majority of Hodlnaut Group’s creditors, constituting a substantial 60% of the total debt, also raised their voices in opposition to the OPNX deal.
The crux of the issue revolved around the dramatic downfall of FLEX, which had witnessed its value crumble by an astonishing 90% since OPNX had tabled the offer to acquire 75% of Hodlnaut back in early August 2023.
At the time of the initial proposal, FLEX had been trading at approximately $7. However, in a stunning turn of events, it had withered away to a meager $0.54 at the time of writing.
Buyout offer rejected
Aside from the alarming depreciation of FLEX, Hodlnaut’s interim judicial managers harbored grave concerns. They were notably troubled by the absence of “any injection of cash or assets with similar liquidity.”
This was a clear reference to heavyweight digital assets like Bitcoin [BTC] and Ethereum [ETH]. Moreover, their dissatisfaction with OPNX’s proposal was exacerbated by the absence of a repayment timeline for creditors’ debts.
There was also a conspicuous dearth of specifics regarding payment beyond a mere 30% of the liabilities.
FLEX is the native token of the Coinflex exchange, which maintains close ties with the OPNX platform. The founders of Coinflex, Mark Lamb and Sudhu Arumugam, had also played pivotal roles in the launch of OPNX.
Coinflex had faced its own set of tribulations, with the exchange suspending all withdrawals in June 2022. The CEO had cited extreme market conditions and “continued uncertainty involving a counterparty” as the primary reasons behind this drastic measure.
In a bid to recover a staggering $84 million in losses from a significant individual customer, Coinflex had taken the matter to a Seychelles court, initiating a restructuring process.
The exchange had further conveyed its plans to officially cease operations on 31 October. It strongly advised its customers to withdraw all funds from the platform before the impending shutdown.