Open Exchange (OPNX) shutters amid troubles for 3AC founders

abdelaziz Fathi

Open Exchange (OPNX), a crypto derivatives platform linked to the co-founders of Three Arrows Capital, has announced its closure in February 2024. The decision was shared on the social media platform X and marks the end of operations for the exchange formerly known as Coinflex.

The OPNX team assures users that they will manage an orderly shutdown process, urging them to settle all positions by February 7. After this deadline, the platform will automatically settle any open positions. Users have been given until February 14 to withdraw their funds and export historical data.

The announcement of OPNX’s closure caused its OX token to drop 38% in value.

OPNX’s association with Kyle Davies and Su Zhu, co-founders of the bankrupt crypto lender Three Arrows Capital, has been a focal point of its history. The exchange was founded following the collapse of their $10 billion Singapore-based crypto hedge fund in June 2022. After the fund’s demise, Zhu and Davies faced legal and financial challenges, including evading contact with Teneo, the firm responsible for liquidating 3AC’s assets.

The shutdown of OPNX adds to the difficulties faced by Zhu and Davies. Teneo is currently pursuing the recovery of $1.3 billion from the founders, alleging misuse of investor funds through leverage post-insolvency. Additionally, Singapore’s central bank issued nine-year prohibition orders against Davies and Zhu for alleged violations of the country’s securities laws at 3AC.

Also in December, a British Virgin Islands court ordered to freeze assets valued at up to $1.1 billion linked to the founders of the now-defunct crypto hedge fund. Additionally, Davies’ wife, Kelly Chen, is also subject to the asset freeze.

Teneo seeks to recoup $3.5 billion for creditors, as the fund faced insolvency after the turmoil caused by the collapse of the Terra ecosystem.

Three Arrows Capital filed for bankruptcy in July 2022. The fund, once a heavyweight in the crypto hedge fund sphere, managed billions in assets, investing across various sectors including liquid tokens, startup equity, and NFTs.

The fund’s liquidators, Teneo, have faced challenges with Zhu and Davies’ cooperation since the fund’s collapse. A lack of collaboration prompted legal actions, including attempts to subpoena the pair via social media and allegations of losses attributed to the founders’ actions preceding the fund’s downfall.

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