OX.FUN, a derivatives exchange backed by Su Zhu, the co-founder of Three Arrows Capital, has officially released a statement denying growing rumors of insolvency.
The platform had to issue a clarification after a sudden withdrawal of $1 million sparked fears of a liquidity crisis.
All withdrawals are processing normally. This is coordinated FUD.
No users were affected by the actions of JefeDAO aside from JefeDAO. He attempted to exploit the platform, got all of his funds frozen, and now is attempting a social media campaign.
Nico will put out a… https://t.co/jJRyFSFkiL
— OX.FUN (@OXFUNHQ) February 24, 2025
OX.FUN’s Dispute with JefeDAO
The rumors of OX.FUN going insolvent started after NFT artist collective, JefeDAO, claimed that one of its members deposited $1 million into the platform but was unable to withdraw the funds. According to JefeDAO, OX.FUN froze the funds and its founder Nicolas Bayle (Nico) claimed the action was taken due to a violation of the platform’s terms.
However, JefeDAO alleged that the exchange offered to return the funds in exchange for promoting the exchange on social media. The NFT collective deemed this as extortion and refused to comply.
Additional woes befell OX.FUN after some crypto community members called for a boycott of the exchange. Some users also claimed that the exchange’s remaining liquidity had dropped to a mere $180,000, leading to a mass exodus of funds and fueling rumors that the exchange was insolvent.
However, with OX.FUN’s recent statement, the platform has denied the rumors, stating that all withdrawals are processing normally and attributed the rumors to a coordinated effort to spread false information.
In addition, the on-chain analytics platform Arkham Intelligence discovered evidence that seems to support OX.FUN’s claims. Data showed about $1 million in funds, specifically its native token OX, in the exchange’s custody.
JefeDAO Accused of Market Manipulation
In light of the controversy, OX.FUN accused JefeDAO of masterminding a social media campaign against the exchange. In another report, the platform argued that JefeDAO performed an oracle manipulation attack, where the NFT artist collective allegedly manipulated the market price using $1 million in USDC.
The severity of market manipulation is underscored by the SEC’s recent crackdown. In October, the body charged three firms and nine individuals for market manipulation. Meanwhile, JefeDAO denied the exchange’s claims of market manipulation, calling them false and a ploy to control damage to the platform.
