Categories: CryptoNews

Converting BFX Tokens to Ifinex Equity is Not As Lucrative As It Seems

Ever since Bitfinex got hacked, there have been some questions regarding the corporate structure. We all know Ifinex is the parent company of the exchange. But one diagram on Twitter paints a very interesting picture of what is going on behind the scenes. All of the information is allegedly based on the last annual return of Renrenbee Limited, as well as statements provided on the BnkToTheFuture platform.

The World of Corporations Is Very Confusing

Not too long ago, the Bitfinex team announced their campaign to have hack victims convert their BFX tokens into a take in parent company Ifinex. This process will be facilitated by the BnkToTheFuture platform. But as it turns out, there is a lot more to this process than meets the eye. BFX Token holders may not be getting what they expected, albeit that won’t surprise too many people.

While it is true Ifinex is the parent company of Bitfinex, they are also a subsidiary of another company. DigIfinex is the name of this conglomerate, which has relations with RenRenbee Limited, Tether Holdings Limited, and various other Bitcoin corporations. No big surprises there, although it makes one wonder how useful ownership in Ifinex will be in the long run.

It is evident Bitfinex is at the bottom of the ladder in this diagram. Users who decide to convert BFX tokens into Ifinex take will move up one rung. However, they will only own a small stake in a company that is owned by DigIfinex for 60% or more. Furthermore, DigIfinex has other major shareholders, in the form of wealthy investors. Their exact stake has yet to be revealed to the public, though. Interestingly enough, these same people are all directors or senior managers of Ifinex as well.

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All of this begs the question if the conversion to Ifinex is such a good idea for BFX token holders. Granted, they will have a stake in an overarching company. At the same they, they will only represent a portion of – at most – 40% of Ifinex. It would make more sense if they received a take in DigIfinex, albeit it is not difficult to see why this will not be the case.

For those who are contemplating exchanging their BFX tokens for Ifinex shares, taking a closer look at this diagram is well worth it. People need to be acutely aware of what they are getting into before making such an important decision. Someone who owns 1% of all BFX tokens will never own 1% of Ifinex. Instead, they own 1% of a 40% take, if not less.

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JP Buntinx

JP Buntinx is a FinTech and Bitcoin enthusiast living in Belgium. His passion for finance and technology made him one of the world's leading freelance Bitcoin writers, and he aims to achieve the same level of respect in the FinTech sector.

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