Illegally Liquidated DHN Tokens by Crypto Platform Blynex Under Scrutiny
UAE-Based Crypto Exchange Blynex Accused of Liquidating Tokens, Failing to Deliver Loan
Dohrnii Labs, a blockchain learning platform, has taken legal action against Blynex, an UAE-based crypto exchange, claiming that the exchange liquidated tokens without permission and failed to issue a promised loan.
On Twitter, Dohrnii Labs posted a transparency update stating, "We've filed a police report in the UAE against @Blynexex and affiliated individuals." The company alleges that on March 23, they deposited over $500,000 worth of Dohrnii (DHN) tokens on the exchange.
Dohrnii Labs further claimed that they used 8,650 DHN as collateral for a 30-day loan in exchange for 81,000 USDT, but never received the promised funds. Blynex, according to Dohrnii Labs, liquidated their 8,650 DHN position on Uniswap, receiving 149,151 USDT and causing the token's market value to drop.
Attempts to withdraw the remaining 4,000 DHN were unsuccessful, the company added.
Mike Vasquez, co-founder of Blynex, stated that the liquidation was part of their automated risk management system. The exchange acted when it became evident that DHN was experiencing liquidity and volatility issues.
As a result of the liquidation, Blynex received 148,160 USDT. However, Dohrnii Labs alleged that Blynex liquidated nearly double the value of their loan, a claim that Blynex denies, stating they acted based on DHN's market value at the time.
Blynex attempted to settle the issue by offering 80,000 USDT and allowing Dohrnii Labs to withdraw 4,000 DHN under a settlement agreement. However, Dohrnii Labs rejected the offer, calling it "unacceptable."
The platform emphasized that the 4,000 DHN in question are user deposits, not operating assets, and the right to withdraw these funds should never be up for discussion.
In the past, UAE-based crypto market maker CLS Global pleaded guilty to facilitating wash trading and market manipulation, but it is unclear whether this incident is connected to the current allegations against Blynex.
The story is still developing, and further updates will be provided as more information becomes available.
The finance industry is concerned about the allegations against Blynex, an UAE-based crypto exchange, as Dohrnii Labs has accused the exchange of liquidating tokens without permission and failing to deliver a promised loan, causing turmoil in the business of digital currencies like Bitcoin. Dohrnii Labs claims that Blynex liquidated nearly double the value of their loan, causing dispute in the finance sector.
