BitMEX Users Lose Money Due to Unexpected BTC Price Spike, Exchange Promises Refund
The recent bull run in the crypto sphere led to the sudden and unexpected price spike in the Bitcoin Core (BTC) prices. This incident went out of hand and led to ‘auto deleveraging’. As a result, many of the BitMEX users lost their money. On this, BitMEX crypto exchange has promised to refund the money to the users who have got affected by the incident.
This week the spike in the prices surprised many of the market analysts who were predicting otherwise. The rates of the crypto rose quickly to more than 1K USD within 24 hours, before touching another surprising milestone of 5,330 USD. Though it is not the crypto’s all-time high, the price’s shooting up was, of course, a great relief to the tumbling crypto market. This instant shooting-up triggered automatic filters at the crypto exchange- BitMEX, leading the platform to close many of the trading positions.
The exchange said that this issue came around due to some ‘technical problems.’ The crypto exchange has assured its users’ compensation for the loss of money, which was due to the automatic deleveraging. As per the reports obtained, this incident has especially affected the crypto traders who were depending on BitMEX ‘leveraged trading products.’ The crypto exchange described it as ‘minimal’ number of transactions, as per the website.
On the other hand, the users of the crypto exchange did not only lost their money due to the automatic deleveraging. Their insurance policy too could not safeguard them against this unexpected turn of event. The insurance policy didn’t compensate any of the affected users. It is quite an irony that just a few weeks ago the crypto exchange celebrated the securing of the comprehensive insurance fund against any such unexpected losses, and yet when the test of time stood by, the insurance compensation could not do much.
Although, the ‘automatic deleveraging’ was highly unexpected, the executives of the crypto exchange have assured that approximately two hundred affected users of the exchange will be given compensation individually. This compensation promise was made in writing on the official blog of the crypto exchange. The blog article covered a detailed analysis of the incident and how the exchange will out-grow this challenge. The crypto exchange said,
“For users that were affected, BitMEX will be reaching out to you personally to explain the situation and document your compensation. We compensated users based on the maximum potential profit that they would have made over the timeframe of these auto-deleveraging event. […] BitMEX did not profit from these auto-deleveraged positions.”
This incident prevented many of the BitMEX users to reap good profits from the price spike in the Bitcoin Core BTC. Still, the users did not show a heated response, as expected. Although the compensation will calm the affected users, but can this compensation bring back the potential gains that the users could have made due to the high tide in the Bitcoin Core? Naturally, there will be an undertone of aggravation in the users for missing out on the opportunity, which was not at all due to their fault.
Another fact that is surprising is that the crypto exchange has been reported to be among the most bullish crypto exchange when it comes to BTC. There are predictions by the exchange making rounds in the crypto sphere that the crypto rates may go up to 10K within this year’s time. The prediction defies and contradicts the otherwise predictions made by the market analysts.