Okx suffered a flash crash of its native token, OKB, on Tuesday, January 23rd.
The event caused the price of the OKB token to dip over 50% in value. OKB moved from an impressive price of $50.69 to a shocking low of $25.10. Let’s explore more about this terrible news.
OKx Offers Compensation to Customers Impacted by Sudden Market Plunge
This huge price decline triggered a rush of automatic liquidations of margined positions. And caused the platform to experience a brief moment of extreme volatility. Okx has brought the situation under control and is working hard to create a compensation scheme for the impacted users.
Explaining the crisis, the exchange wrote on X: “Due to the downward trend of the overall market on January 23, OKB prices fluctuated simultaneously. After the currency price hit 48.36 $USDT at 17:07:26 (HKT), it triggered the liquidation of multiple large leverage positions. Coupled with the impact of market conditions, the currency price fell, which further triggered the liquidation of pledged loans, leverage transactions, and cross-currency transactions, ultimately causing the price to drop to 25.1 $USDT in a short period of time. The currency price has now returned to normal.”
（1/2）由于1月23日市场整体行情下行，#OKB 价格同步波动，币价于 17:07:26（HKT）触及 48.36 $USDT 后，先后触发多个大额杠杆仓位的清算，加之行情影响使得币价下跌，过程中进一步触发了质押借贷、杠杆交易及跨币种交易的清算，最终导致价格在短时间内下跌至 25.1 $USDT ，目前币价已经恢复正常。 pic.twitter.com/Y04BSaCMo6
— OKX中文 (@okxchinese) January 23, 2024
OKX said it will “fully compensate users for additional losses caused by abnormal liquidation, including pledge lending/margin trading/cross-currency transactions.” The crypto exchange plans to unveil detailed plans in the following 78 hours.
As part of its plans to stop such incidents in the future, Okx is also looking into improved risk management procedures and liquidation processes. The trading platform pledged to improve different parts of its services, including spot leverage levels, pledged lending risk control guidelines, and liquidation procedures.
🚨 Breaking: OKX to Compensate Users After Shock 48% $OKB Flash Crash
Yesterday, #OKB mysteriously plunged -48% (from $46.80 to $25.10 ) in minutes before recovering.
And Instant Pump ~90% from Botton $25.10#OKX now pledges to reimburse abnormal liquidations.️But questions… pic.twitter.com/BB0HpMZuI1
— Crypto Patel (@CryptoPatel) January 24, 2024
Despite the recent setback, OKx has made huge strides in complying with regulatory policies. The crypto exchange recently unveiled new requirements for its UK users to ensure their compliance with local rules.
As of this writing, OKB trades at $48.49.
Disclaimer
The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.
