The cryptocurrency exchange Bitfinex and the stablecoin Tether have recently been involved in a significant loss of money and are preparing to raise funds through private fundraising and issuing new tokens. Recently, Bitfinex shareholder and DFund founder Zhao Dong disclosed the details of the new token collection on his personal Twitter. As with the market before, the fundraising scale is up to $1 billion.
Zhao Dong uploaded Bitfinex and Tether’s parent company’s (iFinex) plan on Twitter. It introduced the new token LEO. It will issue 1 billion LEOs by Unus Sed Leo Limited, each of which is worth 1 USDT. The purpose of their fundraising is for daily operations and users can use the new token to reduce transaction costs on the exchange, and LEO’s white paper will be announced in the future.
At the same time, iFinex and its subsidiaries will start to repurchase tokens and destroy them monthly. The monthly repurchase amount is iFinex’s total consolidated revenue in the previous month, at least 27%, until there are only 100 million LEOs left in the market (ie only back the purchase of 90% of the total issuance, and the token used to reduce transaction costs will also be destroyed. As for the minimum 95% of funds recovered from the custodian Crypto Capital, the LEO will be repurchased and destroyed within 18 months from the date of recovery. However, Zhao Dong later said in his personal Weibo that there is no limit to repurchase and destroy LEO, but the details are yet to be announced.
Earlier, the New York State Attorney General accused Bitfinex of allegedly failing to disclose to the client after the money loss of Tether, involving $850 million. Bitfinex subsequently issued a statement on the company’s website, pointing out that the allegations were malicious and that the exchange and Tether had sufficient finances.