- Dubai’s Virtual Asset Regulatory Authority fines OPNX digital asset exchange and founders nearly $2.8 million for violating advertising and marketing rules.
- OPNX founders Kyle Davies, Su Zhu, and Mark Lamb were fined for failing to meet advertising and marketing standards.
- The fines are the largest issued by the regulatory authority, with potential further actions against OPNX for payment recovery and possible law enforcement involvement.
Dubai’s Virtual Asset Regulatory Authority(VARA) has fined digital asset exchange Open Technology Markets (OPNX) and its founders 10,000,000 United Arab Emirates dirhams, nearly $2.7 million for violating several advertising, promotions, and marketing rules.
The crypto bankruptcy claims that the VARA reprimanded the exchange and its founders, Su Zhu, Kyle Davies, and Mark Lamb, in May.
The regulatory body’s notice stated, “Further to Virtual Assets Regulatory Authority’s (VARA) previous notices dated the 12th of April 2023 and the 27th of April 2023 regarding the conduct of Open Technology Markets Ltd. [trading as OPNX and opnx.com], VARA has issued the following fines. AED 10,000,000 against OPNX for a Market Offence under Regulation VIII.A.3 of the Virtual Assets and Related Activities Regulations 2023 (Regulations). This fine was issued on the 2nd of May 2023 and remains unpaid at the time of publication of this notice.”
According to Dubai’s Virtual Asset Regulatory Authority, the fine was issued on the 2nd of May, 2023, and remained unpaid as of the 16th of August, when the notice was published.
Davies, Mark, and Lamb were each fined 200,000 United Arab Emirates dirhams ($54,451) by the regulatory body. This fine was imposed for failing to meet the regulator’s advertising and marketing standards. The notice states that all three have paid the second fine in full.
The fines imposed by the Virtual Asset Regulatory Authority are the largest ever imposed by the regulator. All fines were referred to the regulatory body’s grievance committee and were in accordance with all governance requirements according to the regulatory body. The committee decided that all enforcement actions against OPNX and its founders should be upheld.
“All fines noted above were referred to Vara’s grievance committee in accordance with due governance requirements. The committee reviewed the referral of the grievance and determined that the enforcement actions taken be upheld in their entirety.”
The regulator also signaled further action against OPNX in order to recover payments, which could include referring the case to law enforcement or competent courts.
The Controversial OPNX Exchange
OPNX was founded and launched by Kyle Davies and Su Zhu, the founders of the failed crypto hedge fund Three Arrows Capital (3AC). Following the demise of Three Arrows Capital, Zhu, and Davies were heavily chastised for launching the platform.
Investors can use the platform to trade bankruptcy claims for platforms like CoinFLEX and FTX. As it stumbled into a launch, the exchange conducted less than $2 worth of trades, with major trading firms claimed to be investors by OPNX denying their involvement.
The crypto sector had a difficult 2022, with several major projects and entities failing, as well as hacks and other threats dampening investor interest.
