All eyes have been on Bitfinex in recent days, with the exchange experiencing dramatic flash crashes on select altcoin markets after having been the subject of a distributed denial-of-service (DDoS) attack last week. A quarterly shareholder update from the company has also been leaked, evidencing that Bitfinex is one of the major institutions purchasing USDT from Tether – intensifying the controversy and scrutiny surrounding the relationship between the two companies.
NEO, ETP, and OMG Experience Severe Flash-Crashes on Bitfinex
On the 29th of November, several altcoin markets witnessed extreme flash-crashes on the Bitfinex markets. Metaverse (ETP) lost more than 98% of its USD value in a single 1-minute candle. ETP immediately recovered from the crash, however, it quickly showed more signs of weakness, eventually leading to a secondary flash-crash that saw metaverse lose more than 60% of its value in less than ten minutes. NEO experienced a similar crash, losing almost 90% of its value in less than five minutes, whilst OMG lost over 60% of its value in under five minutes.
Although most of the markets have since recovered, many margin traders have complained that they were liquidated as a consequence of the sudden price movements. Brett Kruger, a customer of the exchange, told media that the exchange was “lagging” and “unresponsive” during the flash-crashes – asserting that the technical difficulties left traders unable to react and manage their positions once the crash began, in some cases resulting to stop orders being executed at prices significantly lower than those set by the user…