BFX opened with a sharp drop instead of a sharp rise

In the past few days, a piece of news has been all over WeChat, "Bitfinex resumed trading and withdrawals, and its debt token BFX soared 400%". A junk bond can soar several times! Under reasonable circumstances, the debt can be converted into equity, and the transaction price may exceed the face value. At present, B.com is in crisis and surrounded by enemies, and there will only be panic selling. The news said that it soared instantly, and there must be "fraud" in it!

Let me ask you, what is the actual face value of BFX? If you answer 0.1 USD, and it has soared to 0.4 USD, congratulations, you have been successfully misled.

A post on the Babbitt forum showed a clue: the issue price was $1, the opening price dropped directly to $0.1, and then rebounded to $0.4.

After repeated verification, it has been confirmed that the truth is that BFX opened with a sharp drop, not a sharp rise!!! A post on the Babbitt forum revealed the truth, and a press release circulated worldwide just missed the key detail that the opening price was $1, causing people in the industry (international and domestic) to be misled on a large scale.

As a news reader, most of the time, you will only read the headlines. But if you calm down and carefully savor the official text, you will find a lot of information that is different from what you see in the press release, which is worth analyzing by friends in the industry.

As you may know, a significant amount of money was stolen from iFinex and BFXNA (collectively, Bitfinex Group) on August 2, 2016. Since then, Bitfinex Group has worked together to stop the theft: investigating the security breach; locking down and protecting all assets on the Bitfinex website; and working with international law enforcement agencies to identify the criminal group, track the stolen assets, and recover the proceeds for our users.

In order to deal with the possible situations that may occur when the losses of dispersed holdings enter the liquidation process as reasonably as possible, the losses are apportioned to Bitfinex registered user accounts according to the assessed proportion. You can check this proportional loss share on your account balance. By clarifying your loss share, the Bitfinex Group promises to take action to recover your proportional share of the loss and fully protect your rights.

To illustrate this commitment, Bitfinex will issue a token to your account. This token represents your share of recourse and Bitfinex's contingent obligations (depending on the circumstances, it may imply the execution of debt-for-equity swaps in extreme cases. Translator's note). This token is a concept credit, its redemption depends on Bitfinex's ability to recover losses and is subordinate to any other claims against Bitfinex. Recovery of losses means: recovery of stolen assets, funds raised in financing activities, or cash received in daily operations. The issuance of this token is not our intention to reduce or evade your recourse against Bitfinex. Similarly, Bitfinex does not waive any claims or defenses based on the User Terms. In addition, you can choose to set aside this token concept to assert any claims you may have.

The debts represented by this token do not generate interest, nor do they enjoy dividends or other distributions, etc. The purpose of setting up this token is to redeem you in proportion to "recover your losses". Moreover, once the proportion of liquidated funds issued to you reaches its face value, we will unconditionally and unilaterally take it back.

The tokens and rights hereunder shall not be distributed without the prior consent of Bitfinex Group. Bitfinex Group reserves the right to interpret these Terms.

The translation is provided for reference and analysis. Please feel free to criticize and correct any inappropriate parts.