Recently, an artist organization called jefeDAO disclosed online that its assets were maliciously frozen by OxFun, an exchange supported by Su Zhu, the founder of Three Arrows Capital.

OxFun refuses withdrawal request

It is reported that the organization had previously deposited $1 million into OxFun, but is now unable to withdraw it. Although the organization attempted to negotiate with OxFun founder Nico, Nico demanded repayment over five months and even threatened that these assets now belong to the platform. If jefeDAO is unwilling to accept, these assets will be distributed to other users.

On chain data shows insolvency

In response to this matter, Conor Grogan, the head of product strategy at Coinbase, revealed in an article on X today that OxFun may be facing the dilemma of insolvency.

Conor Grogan pointed out that according to reports from Arkham, social media, and records of large on chain transfers, OxFun's current non OX (OxFun platform currency) liquid assets are worth less than $2 million. Among them, USDC only has about 1 million US dollars left.

If we deduct the $1 million owed by OxFun to jefeDAO, it means that OxFun currently holds non OX liquid assets worth only over $1 million, most of which are memes. Conor Grogan After a series of on chain analyses, it appears that all ETH Gnosis Safe wallets of OxFun have been emptied, and the exchange appears to be withdrawing some of its liquidity funds (LP) and selling SOL in exchange for USDC, while also buying OX.

Conor Grogan It should be emphasized that the data may not reflect the true situation, and there may be other addresses that OxFun has not discovered. However, based on the current information, storing assets in OxFun is a rather dangerous choice.

OxFun responds to external doubts

In response to community questioning, OxFun On the contrary, the accusation is that it was because Jeff launched a oracle manipulation attack on OxFun that the platform froze his funds. The exchange wrote:

He made his first deposit of 1 million USDC at 05:38:43 on 2025/2/14 and began selling JAILSTOOL aggressively between 05:46:56 and 05:57:06. He set a limit sell order of over $600000 at price 0.048 and then placed an additional sell order at price 0.045, when the fair price of the currency was 0.05. In a short period of time, he traded over $300000 in total and lowered the market price to below 0.04. Before 06:00:00 on 2025/2/14, he quickly closed all short orders at a price as low as 0.034. This behavior clearly violated OXFUN's terms of service and harmed other parties. We have frozen Jefe's funds for the benefit of our users

In addition, OxFun It is emphasized that except for the funds of the malicious actor Jefe being frozen, the funds of other users have not been affected.