NEWS
NEWS
NEWS
Bitfinex customers offered equity in compensation for bitcoin lost in hacking
Customers of bitcoin exchange Bitfinex (BTXNA, Inc.) are being offered equity in the company in compensation for the losses imposed on them, following the hacking of the exchange in early August.
Under the deal, customers who were issued BFX tokens following the decision by the company to socialize the losses caused by the hack will be able to use those tokens for equity in iFinex, Inc., the British Virgin Islands-based parent company of Bitfinex.
The management of the equity issue is being handled by bitcoin equity crowdfunding service BnkToTheFuture (Bnk To The Future Ltd.), which will be facilitating the exchange of tokens via a Special Purpose Vehicle (SPV).
“When clients’ funds are stolen from an exchange that is the size of BitFinex, we need to (where possible) focus on finding good market solutions that can potentially compensate investors faster than traditional proceedings,” BnkToTheFuture Co-Founder and Chief Executive Officer Simon Dixon said in a statement. “Today we may be able to use new Blockchain assets and financial innovation to produce better and faster solutions for victims.”
Trying
The decision by Bitfinex to socialize its losses across all of its customers remains highly controversial and arguably questionable under law, but to the exchange’s credit they are at least trying to do the right thing by giving customers equity in the company as compensation.
What Bitfinex’s parent company iFinex, Inc. is worth, however, is another matter. Customer losses in the hack came in at 119,756 bitcoin, which at the time of the hack was valued at $65.6 million, or at today’s BTC/USD price is $69.3 million, a sizeable sum for any company.
The deal is a great one for the rapidly growing BnkToTheFuture, which now claims to have hosted funding rounds resulting in over $70 million worth of investments from qualified investors over the past year, up from $10 million in June 2015.
Details as to how the exchange of BFX tokens to equity will occur are still being sorted out with both companies saying only that full details will “be released at a future time.”
Image credit: zcopley/Flickr/CC by 2.0
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