Recently CoinFlex restructuring proposal was passed with 98% of the votes in favor of restructuring. After the successful voting procedure, CoinFlex distributed the locked assets and created the tradable market pairs with respective unlocked assets. Here in this article. we will go through what locked assets are, whether should you sell them or wait, and what comes next. But before going further please remember this is not financial advice.
The Vote
The blockchain voting for the CoinFlex restructuring proposal was carried out between the 25th & 27th of September on the third-party platform called snapshot. If you want to understand the process of this proposal voting in more detail, you can refer to this article. The restructuring proposal was passed with a massive 98% vote in favor, because of which CoinFlex is now good to go further with their plans.
This vote will be presented in the court, after which it is supposed (expected) that the court will approve the restructuring of CoinFlex. The estimated duration of this procedure is around 6 weeks. So we can expect that we will see a further update on the restructuring of CoinFlex in the upcoming weeks, if everything goes as expected by CoinFlex then we might see the determination of composite details right after the court approval. Six weeks time period is the best case scenario, this duration can change according to the situation.
Locked Assets
Right after the successful voting on the restructuring proposal, CoinFlex issued the locked assets to the users. Here the terminology is, Locked Assets are the assets that are not withdrawable, and Unlocked Assets are the assets that can be withdrawn from the CoinFlx. Locked assets are the assets that are tradable in the market with the base pair of its own unlocked asset. For example, if you had 1000 USD before all this drama, then you would get 1000 LUSD which represents the locked USD you were holding, this LUSD is tradable against USD which is unlocked, they are not 1:1 tradable but at a random price depending upon the market dynamics. Till now ~$560.6k LUSD has been traded since the market is live.
At the time of writing this article the LUSDC?USDC is trading at a price of ~0.25 which means you will be getting 25 cents on every dollar, that means a user can sell their locked asset and get out of this stuff at a cost of 75% loss. The market for the Locked Assets will be live till the approval from the court, once CoinFlex gets the approval from the court there won't be any market to trade the Locked Assets. Since there estimated time for the approval is around six weeks, we can say that the trading market for Locked Assets will be live for six weeks.
The Restructure - Composite
At the time of restructuring, the creditors of CoinFlex will receive a composite of assets and equity, there is not much information available regarding the ratio of composite but it is expected that it will be disclosed or discussed once CoinFlex gets approval from the court. Here the creditor of the CoibFlex is the one that holds the Locked Assets. Now anyone who is not interested in taking the composite and wants to get out of this situation then that person can sell the Locked Asset in the market at a discounted price. Ant person buying the Locked Asset will then be considered as the creditor of the CoinFlex and will receive the composite of that certain amount of Locked Assets.
This restructuring might take a long time and it is completely based on the court's approval. So anyone not interested in composite or could not wait that far can exit with the cost. But remember, once you sold your Locked Assets for the unlocked assets then you will not be entitled to receive the composite as then you will not be treated as the creditor of the CoinFlex.
This is all about the CoinFlex, there will be more information coming out on the SmartBCH unlocking, so for the SmartBCH community, there is a longer waiting period of time but it is expected we will hear something regarding it soon. For now, this is all about the latest stuff related to CoinFlex.
Hope you found this article helpful, if yes then do share in your circle so that they might get an understanding of the current scenario of the CoinFlex scenario which will help them to take decisions related to Locked Assets,
Thanks For Your Time!
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