Note from the CEO: Ah, the saga continues. Even the WSJ is making it big news. “Socialized losses” meet Mr. Attorney. There will be a backlash against Bitfinex’s attempt to “steal” back its loss from users. Gonna get interesting.
“With the socialized losses initiative being set up by Bitfinex, many people feel this is the best way to keep the exchange afloat. But under Hong Kong law, it is not possible for the company to enforce this decision, as there is no legal bankruptcy protection. It is still possible to open lawsuits against the company, and even force them to prove their solvency. Failure to do so would allow creditors to take control of the platform.
The majority of Bitfinex users feel they have no other choice than accept the balance reduction. That is not entirely accurate, though, as the company cannot legally defend this decision by any means. It is evident this move was made because the company can’t pay the missing balances themselves.”