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BitMEX credit crisis broke out, futures market or reshuffle?

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1 week ago

Two unexpected downtimes in one day on Friday were accused of manipulating the market and being boycotted. BitMEX, dangerous!

In just half a day, BitMEX experienced two unexpected downtimes in a row, and this situation that severely affected the trading experience happened exactly during the peak trading period of the Bitcoin price dive. The “contradictory” interpretation of the official BitMEX response to the downtime has exacerbated the skepticism of the market, and as a result, a resistance voice of “abandoning the use of BitMEX” has emerged in the market.

On the morning of March 13, Beijing time, China, the BitMEX crypto trading platform experienced a short-term downtime and trading was suspended. According to the official website of BitMEX, the current price of Bitcoin's perpetual contract on its platform has stopped at around $ 3,715, with trading suspensions starting at 10:15 and returning to normal at about 10:30. In response, BitMEX responded to The Cap's press director Frank Capitulation, saying that our cloud service provider has a hardware problem, which caused BitMEX's request to be delayed between 10:16 and 10:40. At present, the engineer has resolved the problem, and BitMEX has resumed normal service at 11 am.

In just half a day, BitMEX reappeared at 20:56 Beijing time on March 13th. The official response from BitMEX after the incident said that the DDoS attack was the real cause of the short-term downtime, and the downtime that morning was due to the same problem, not the previously stated "Cloud service provider exists hardware problem".

As soon as the outage occurred, some traders and market analysts publicly expressed doubts about "hardware problems" and said that it was BitMEX's reluctance to respond to market conditions that accelerated the decline of Bitcoin. After the platform was offline, Bitcoin A rebound quickly occurred, in part because BitMEX's huge selling pressure "disappeared" due to unexpected downtime. Some people even accuse BitMEX of stopping trading to manipulate the market.

Although BitMEX's official response said that these remarks were downright conspiracy theories, the official response to the inconsistency of the outage problem further increased the suspicion of the market.

Trader @Lowstrife pointed out on Twitter that the excessive leverage of the BitMEX exchange itself caused a large number of clearing orders to eat up orders in the market when the price began to fall, and the continuous liquidation directly led to the collapse of the price. BitMEX's behavior of suspending transactions can be understood as an operation to switch the "automatic gear" of the clearing to "manual gear". And this forced termination of the market's endless liquidation process has temporarily freed the market from selling pressure and "helped" the Bitcoin price to stabilize and rebound.

Lowstrife pointed out that the rapid rebound of Bitcoin allowed BitMEX exchange to obtain greater profits from it. He emphasized that it was not that BitMEX deliberately caused the market to collapse, but that the backlog of highly leveraged positions exacerbated the risk of rapid decline in the process of market decline, and that the rules of liquidation caused the market to collapse. However, BitMEX terminated the established "gameplay" by special means and obtained greater profits from it.

Because the point of the BitMEX platform itself to attract investors is to provide high multiple leverage services, each time the market suddenly rises and falls sharply, the BitMEX platform will appear a large number of liquidation orders. And this means that every time the Bitcoin price changes, the BitMEX exchange can get considerable profits from it. Because of this, BitMEX is often accused of "manipulating the market."

Another questioning point is that although the latest survey shows that the operation of BitMEX's insurance fund is in demand, the insurance fund did not play a role of "saving the market" when the recent round of transactions occurred. Instead, it continued to rise while plunging and Continue to create new historical highs. The balance of the BitMEX insurance fund on March 14 has reached 36,493 bitcoins. This has also attracted a lot of criticism in the market.

It is true that the market's doubts about BitMEX are difficult to have a real "result", but this time the "word-of-mouth crisis" that BitMEX faces seems to be far more serious than any previous one. According to the Skew market chart, OKEx's BTC futures trading volume was $ 12.12 billion in the past 24 hours, almost double BitMEX. It remains to be seen whether the cryptocurrency futures market will change in the short term.

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