Bitfinex issued BFX tokens after the 2016 hack, helping customers regain part of their lost assets within eight months.
The U.S. government may recognize Bitfinex as the sole eligible entity for compensation from the 2016 Bitcoin theft.
Bitfinex will use recovered funds to redeem RRTs before distributing the remaining assets to UNUS SED LEO token holders.
The U.S. government may recognize Bitfinex as the only entity eligible for compensation following the 2016 Bitcoin hack, which saw 119,754 Bitcoins stolen. As part of its response to the breach, Bitfinex implemented a creative compensation strategy that included issuing BFX tokens to help customers recover their losses. Now, the government is planning to set up a website allowing affected users to claim their rights under victimsâ restitution laws.
https://twitter.com/arvid_crypto/status/1844069614034223449
Bitfinexâs Response to the Hack Â
Following the massive Bitcoin theft in 2016, Bitfinex reduced its customer accounts by approximately 36%. In an attempt to recover some of the losses, the company issued BFX tokens. These tokens allowed customers to trade or exchange them for shares in iFinex, the parent company of Bitfinex. Within just eight months, Bitfinex redeemed all BFX tokens, helping affected customers recover part of their losses.
Further Compensation Measures for Customers Â
Customers who opted for shares instead of BFX tokens were granted Recovery Right Tokens (RRTs). These tokens could be redeemed for $1 if funds were recovered. As of now, about 30 million RRTs remain unclaimed. iFinex has committed to redeeming these tokens as soon as the recovered funds are available.
While Bitfinex made significant efforts to compensate customers, the U.S. government suggested that a substantial number of account holders may have been affected. To address this, the authorities plan to create a website where potential victims can verify their claims. This move aligns with the Crime Victimsâ Rights Act and the Mandatory Victimsâ Recompense Act, ensuring that individuals entitled to compensation can pursue their rights.
Bitfinexâs Future Plans for Compensation Â
Bitfinex intends to use any recovered funds to redeem RRTs before allocating up to 80% of the remaining assets to UNUS SED LEO token holders. While these token holders wonât directly receive the recovered Bitcoin, they could potentially benefit from token burn mechanisms. With this legal determination, the government may focus more on returning assets to Bitfinex, streamlining the process.
