Kyle Davies and Su Zhu’s Open Exchange (OPNX) is set to close on February 14, according to an email sent to users on February 1. Trading on the platform will cease on February 7, but users will still be able to make withdrawals until the closure date.
In the meantime, a new exchange called OX.Fun has emerged as a potential replacement for OPNX. OX.Fun utilizes OPNX’s native token, Open Exchange Token (OX), as collateral for derivatives trading. The exchange has been heavily promoted within the official OPNX Telegram channel. However, information about the individuals running OX.Fun and their connection to OPNX is scarce.
OPNX was launched in April 2023 by Kyle Davies and Su Zhu, who were co-founders of the failed cryptocurrency hedge fund Three Arrows Capital (3AC). Mark Lamb and Sudhu Arumugam, co-founders of the bankrupt crypto exchange CoinFLEX, were also involved in the creation of OPNX. Initially, OPNX was marketed as a reboot of CoinFLEX, but the OPNX team claimed the two exchanges were separate entities after getting entangled in a legal dispute with CoinFLEX creditors.
During 2023, OPNX experienced some success, with daily trading volumes reaching $32,000 for spot trading and $82 million for derivatives trading by November. However, at the time of the announcement of OPNX’s closure, the volumes had significantly dropped to just $23 for spot trading and $1.2 million for derivatives.
Despite the closure of OPNX, the OX token is still being traded on various decentralized and centralized exchanges, including Uniswap, Gate.io, BingX, Bitget, MEXC, Poloniex, and others. OX.Fun appears to be targeting the existing OPNX community, as promotional messages for the new exchange have been found in the official OPNX group. However, many users are confused about the relationship between the two platforms.
OX.Fun has shown some level of success, with its derivatives volume reaching nearly $39 million on January 30, according to its official analytics page. Although the volume dropped to $8 million the following day, it still surpassed the volume on OPNX during the same period.
The user interface of the OX.Fun app bears resemblance to decentralized derivatives protocols like GMX, dYdX, and Level Finance. It includes a “Connect wallet” button that allows users to connect their self-custody wallets to the app and confirm transactions.
Cointelegraph journalists tested the app and found that it worked as expected, displaying balances and other data related to their Web3 wallet. However, the deposit page on OX.Fun does not function like a typical decentralized protocol. Instead of triggering in-wallet transactions, users are instructed to manually send funds to an external deposit address, which is generated when the user visits the deposit page.
Based on these observations, it appears that OX.Fun is a centralized, custodial futures trading platform. When users deposit OX tokens to the provided address, the tokens are likely sent to an exchange hot wallet account. Additionally, the deposit address has no previous transactions, suggesting the behavior of a centralized entity.
Cointelegraph attempted to contact OX.Fun for comments but did not receive a response.
One concern for OX.Fun users is the high slippage for OX tokens. As the platform only accepts OX as collateral, users who don’t already own the token need to purchase it. However, the token has low liquidity, and Cointelegraph found that slippage often exceeds 50% even for small purchases.
Information about the executives and location of OX.Fun is currently insufficient. Cointelegraph reached out to the team through the official Telegram channel and the customer support tool on the OX.Fun website but did not receive any response. Users have also reported difficulties in obtaining information about the founders, directors, and investors of the project.
Despite the uncertainty surrounding OX.Fun’s ownership, the app appears to be functioning normally for deposits and withdrawals.