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After failed LUNC short trade: Korean crypto startup Uprise wants to compensate investors

 


South Korean crypto investment firm Uprise plans to compensate investors for damages incurred in the wake of their futures bet on Luna Classic (LUNC). Luna Classic is a coin created after the hard fork of the former Terra Luna token . 


According to Korean newspaper Soul Economic Daily, Uprise wants to replace 40 percent of the loss suffered by customers related to the failed short bet on the token. The short position was initiated in May with client funds deposited into a $20.3 million discretionary investment vehicle. As Cointelegraph reported, Uprise lost 99 percent of its assets on the trade when the position was liquidated.


"After obtaining approval from existing shareholders, the compensation process will be carried out," the Soul Economic Daily report said. Most of Uprise's clients are high net worth individuals and businesses.

The compensation plan calls for the issuance of Uprise stock to investors based on the company's valuation following last year's Series C funding round. This took Uprise's value to approximately $213.2 million. "The issuance of new shares is expected to represent approximately 3 percent of ownership," the report said. Uprise will increase the number of shares through a stock split.


Uprise said the company will go ahead with its compensation plan, although it is not legally required to do so. "The company has no legal obligation to compensate. This is a measure to continue to grow the business while restoring confidence through amicable agreements with customers," the report continues.


LUNC's price has fluctuated wildly since Terra 2.0 restarted at the end of May. The token price is currently around $0.0000997 according to CoinMarketCap.

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