- CoinFLEX says that it will layoff a portion of its workforce due to the costs of distributing its composite asset.
- By next week, the company expects to have data on how much of the CoinFLEX Composite is owed to each user.
- CoinFLEX originally suspended user withdrawals on June 23 and partially reopened withdrawals on July 14.
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CoinFLEX has announced that it will lay off a significant portion of its team as it attempts to recover from insolvency and compensate users who are unable to withdraw their funds.
CoinFLEX Announces Significant Layoffs
CoinFLEX says that it will cut much of its workforce.
The firm revealed today that the cost of its recovery plan—namely the distribution of the CoinFLEX Composite to its userbase—has necessitated “significant” staff cutbacks.
The composite, which will be distributed to users who hold balances with CoinFLEX, includes the company’s new Recovery Value USD token (rvUSD), its longstanding FLEX Coin token (FLEX), and shares of equity in the company itself.
“This [plan] means that we, unfortunately, had to let go of a significant number of the CoinFLEX team across all departments and geographies,” the company wrote on its blog today.
CoinFLEX added that the cutbacks will help it operate efficiently. Though it may scale up if it sees higher volumes, the firm aims to remain at a size at which it can easily form partnerships or accept an acquisition offer from another company.
The company did not say precisely how many employees would be let go. However, it said that staff cuts and non-staffing cutbacks will reduce its cost base by 50 to 60%.
In today’s update, CoinFLEX also said that it will put its composite distribution plan to a vote next week, as it expects to have numerical data on the plan at that time. The company is determining the range of composite that users are likely to receive as well as the range of further normal distribution.
That data will also allow it to offer another market to users involving the trading of locked balances against unlocked balances. This will enable users who want immediate liquidity to sell to other customers interested in keeping their funds with CoinFLEX. The firm plans to open this market next week.
CoinFLEX suspended withdrawals on June 23. It expected to reopen withdrawals on June 30 but ultimately failed.
It partially reopened withdrawals on July 14, allowing users to withdraw up to 10% of their balance. At that time, it confirmed that it would begin to explore the recovery plans above.