Key Points
- BitMEX experienced a flash crash of Bitcoin below $9,000 on its USDT spot market, but derivatives were unaffected.
- The exchange is investigating potential misconduct and large sell orders related to the incident.
The cryptocurrency exchange and derivatives trading platform BitMEX witnessed a sudden drop of Bitcoin below $9,000 on its USDT spot market, but it did not affect the derivatives market.
Investigating Unusual Activity
BitMEX is currently probing into an “unusual activity” involving substantial sell orders on its BTC-USDT spot market. The exchange reassured that the incident did not influence any of its derivative markets or the index price for its XBT derivatives contracts.
A crypto community member noted that someone dumped over 400 BTC in 2 hours on the XBTUSDT pair on BitMEX, incurring a loss of at least $4 million. The total volume was nearly 1,000 BTC over 3.5 hours with a low of $8,900.
BitMEX’s Response
BitMEX responded by stating that it had not disabled withdrawals for all users, only for a few accounts associated with its ongoing investigation.
The exchange later mentioned that it’s looking into “potential misconduct” by traders on its BTC-USDT spot market, re-emphasizing that the flash crash had no impact on its derivatives markets.
BitMEX highlighted that the incident did not affect its billion-dollar derivatives markets, did not move mark prices, and no liquidations were triggered by it. The reason for the price drop, BitMEX explained, was due to the BTC sell orders being too large and frequent for independent market makers and other traders to react to.
BitMEX confirmed that deposits and withdrawals continue to be processed as usual on the trading platform. The exchange was contacted for further comments regarding the incident.
