Kyle Davies and Su Zhu, the founders of the bankrupt digital asset hedge fund Three Arrows Capital (3AC), are facing a fine from Dubai’s private crypto regulator through the OPNX exchange. In addition to the financial penalty for regulatory violations, the company executives have also been fined for advertising and promotional breaches.
Unpaid Penalty for the Company
On August 16, the Dubai Virtual Asset Regulatory Authority (VARA) announced a fine for the OPNX exchange. The regulatory authority stated that it imposed a penalty of 10 million dirhams, equivalent to approximately 2.7 million dollars, for violations of market regulations and noted that the fine has not been paid.
VARA also announced a fine of 200,000 dirhams (approximately 54,000 dollars) for the OPNX executives, including Davies, Zhu, Mark Lamb, and CEO Leslie Lamb, in addition to the exchange. The financial penalty was imposed for violations of Dubai’s marketing, advertising, and promotional laws. According to the regulatory authority, the individuals in question have already paid their fines.
Indirect Sanctions Will Be Imposed
Since the 2.7 million dollar fine has not been paid, VARA stated that it will determine “indirect actions that need to be taken against OPNX.” The regulatory authority emphasized that this could involve further penalties or additional financial fines and that necessary measures may be taken to recover the payment. According to VARA, this situation may also involve referring the matter to law enforcement or an authorized court.
OPNX was founded earlier this year by the 3AC co-founders and CoinFlex founder Mark Lamb. The exchange only had a trading volume of $13.64 on its first day. However, the daily trading volume of the exchange increased to $30 million by late June.
Dubai regulator VARA has shown a strong stance on crypto violations this year. VARA suspended the license of BitOasis, the first licensed crypto exchange in the emirate, on July 10 for failing to meet mandatory conditions within the given period by the regulator.
