Open Exchange Token

<p>Crypto bankruptcy claims trading platform OPNX and its founders have been hit with a hefty fine, imposed by Dubai’s Virtual Assets Regulatory Authority (VARA). The penalty, amounting to AED 10 million ($2.7 million), was levied on the newly established exchange in accordance with a<a href="https://www.vara.ae/en/regulations/regulatory-notices/vara-notice-of-fines-opnx-exchange/" rel="noopener noreferrer nofollow"> notice</a> published by the regulator on Wednesday.</p><h2 id="header-0">Payment outstanding</h2><p>VARA’s recent announcement highlighted that the fine had been imposed in May and remains outstanding. The regulatory body disclosed that individual fines of AED 200,000 ($54,451) each were imposed on Su Zhu and Kyle Davies, the controversial founders of failed Singapore-based crypto hedge fund, Three Arrows Capital (3AC). Additionally, fines were also imposed on two other co-founders of OPNX. The penalties were attributed to failures in adhering to regulations governing marketing, advertising, and promotions.</p><p>OPNX, established earlier this year by Su Zhu and Kyle Davies in collaboration with Mark Lamb and Sudhu Arumugam, positioned itself as a trading platform for crypto claims following the collapse of their Three Arrows Capital (3AC) fund last summer. The duo has since made Dubai their primary operational base.</p><h2 id="header-1">Further action</h2><p>“In light of the company’s unpaid fine, VARA shall determine consequential actions warranted against OPNX, which may include further fines, penalties, and/or taking any actions necessary to recover payment and definitively remedy the behavior,” stated VARA in an official<a href="https://news.bloomberglaw.com/financial-accounting/dubai-fines-three-arrows-founders-over-new-opnx-crypto-project" rel="noopener noreferrer nofollow"> statement</a>.</p><p>Dubai is making a concerted effort to nurture the development of crypto-related business, implementing various<a href="https://medium.com/&#64;coinness.gl/dubai-tempts-ai-and-web3-enterprises-with-subsidized-commercial-licenses-50c1142f0ad" rel="noopener noreferrer nofollow"> initiatives</a> in order to bring that about. However, as part of that strategy, Dubai’s regulatory landscape for cryptocurrencies has taken a more stringent turn this year, with the introduction of a new regulatory framework mandating that companies catering to retail investors must secure full licensing from VARA.</p><p>Concerns arose in February when regulatory authorities discovered that OPNX was actively seeking customers for its platform and collecting personal data without proper authorization.</p><h2 id="header-2">Formal reprimands</h2><p>In April VARA issued an<a href="https://www.vara.ae/en/" rel="noopener noreferrer nofollow"> investor alert</a>, outlining that OPNX was not a regulated entity although it was operating from Dubai. Shortly afterwards,<a href="https://medium.com/coinmonks/dubai-regulator-issues-reprimand-to-opnx-founders-dbfb0ddc9c02" rel="noopener noreferrer nofollow"> formal reprimands</a> followed for the two 3AC founders, alongside Mark Lamb, Sudhu Arumugam, and OPNX’s CEO Leslie Lamb.</p><p>Leslie Lamb, in a previous interview with Bloomberg, emphasized that OPNX had not actively marketed itself toward Dubai or the broader UAE market. She stressed the company’s full cooperation with VARA’s ongoing investigation, asserting that no regulatory guidelines had been breached.</p><p>“While Kyle and I contributed the initial ideas for OPNX, Leslie is very much the CEO, and we aren’t involved in day-to-day operations,” stated Su Zhu, clarifying their roles.</p><p>Despite the regulatory setback, both Su Zhu and Kyle Davies continued to promote OPNX on the X platform (formerly known as Twitter).</p><p>It<a href="https://medium.com/&#64;coinness.gl/opnx-makes-a-play-for-struggling-crypto-lender-hodlnaut-e96b285d411a" rel="noopener noreferrer nofollow"> emerged</a> recently that the claims trading platform has been eyeing the acquisition of failed crypto lender Hodlnaut, which is currently undergoing court-supervised restructuring in Singapore. Zhu and Davies have come in for a lot of criticism within the crypto sector, having left a long list of unpaid creditors as a consequence of the failure of 3AC. The duo recently<a href="https://medium.com/&#64;coinness.gl/3ac-co-founder-disputes-us-jurisdiction-citing-singaporean-citizenship-196830895ef5" rel="noopener noreferrer nofollow"> suggested</a> that they would contribute profits from OPNX to 3AC creditors despite the fact that they have been uncooperative with the 3AC bankruptcy process.</p>

Dubai Regulator Hits OPNX With $2.7M Penalty

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