OX.FUN, a gamified crypto derivatives exchange backed by co-founders of Three Arrows Capital, is currently embroiled in a controversy surrounding allegations of insolvency and misconduct. The exchange, which boasts Three Arrows Capital co-founder Su Zhu as an advisor, is under scrutiny as data suggests that it primarily holds its own OX token.
In a recent post on X, OX.FUN refuted claims of insolvency, stating that all withdrawals are processing normally. The exchange accused NFT artist JefeDAO of attempting to orchestrate a coordinated FUD (fear, uncertainty, and doubt) campaign against them. According to OX.FUN, JefeDAO’s funds were frozen due to violations of the platform’s terms of service.
The dispute between OX.FUN and JefeDAO began when a member of JefeDAO deposited $1 million in USDC into the exchange but was unable to withdraw the funds. OX.FUN’s founder, Nicolas Bayle, alleged that JefeDAO engaged in an “oracle manipulation attack,” manipulating market prices to exploit the platform. JefeDAO, however, refuted these claims and accused Bayle of trying to extort them by offering to return the funds in exchange for daily social media promotion of OX.FUN.
Coinbase’s head of product, Conor Grogan, weighed in on the controversy, suggesting that OX.FUN’s wallets predominantly hold its own OX tokens. He pointed out that if the exchange processes a pending $1 million USDC withdrawal, its USDC balance would significantly decrease.
The ongoing dispute between OX.FUN and JefeDAO highlights the challenges and risks associated with decentralized exchanges and the importance of transparency and accountability in the crypto industry. As the situation continues to unfold, investors and users are advised to exercise caution and conduct thorough due diligence before engaging with any crypto exchange or platform.