A lot of talk has developed from the recent failings of BitMEX in the middle of Bitcoin’s 50% carnage on Mar. 12, 2019. A number of analysts have sided with the largest Bitcoin futures platform with others calling for traders to abandon the platform saying BitMEX “never had the intention of providing a functioning platform.”
After a three hour collapse of one of the largest BTC markets, BitMEX users were at the exchange’s head, Arthur Hayes, neck as shorts were massively “bullzooka’d” on market open. However, it seems the exchange is refunding the wrongly liquidated shorts as one user’s email from the exchange’s support team shows.
Between 02:16 and 02:40 UTC 13 March 2020 we became aware of a hardware issue with our cloud service provider causing BitMEX requests to be delayed. Normal service resumed at 03:00 UTC. As a reminder, latest system updates can be found on our status page https://t.co/fVa1FAqSEW
— BitMEX (@BitMEXdotcom) March 13, 2020
BitMEX offering refunds?
In February, a 58% flash crash on XRP’s perpetual futures contract in February this year caused an outrage across the XRP Army calling on the exchange to refund the liquidated users. However, the exchange did not refund the users claiming the liquidations arose from a legitimate trade caused by high leverage trades by a user.
What's amazing is there seems to be little backlash on twitter about this compared to $xrp wicking down a few % and some moron who was on really high leverage getting liquidated. $xbt pic.twitter.com/L2d1yJGNGz
— Crypto₿uzz (@cryptobuzznews) March 15, 2020
This time however, the exchange may be looking at the situation in a different light – choosing to refund the users affected by the Mar. 12 blackout. At least as one user claims, after losing Ethereum (ETH) during the flash crash. The trader tweeted,
“Wow guys, Bitmex actually refunded me after they scammed me during that crash. I now have more respect for @CryptoHayes. What a ledge. $ETH was trading at $96 & I put a limit order at $120 to short with a stop at $123. And it got bullllzooooka’d. Thanks for refund!”
One thing that perplexed the community is the reluctance of BitMEX to use the insurance fund despite the crypto market facing one of its most volatile days ever.
What is the point of the insurance fund if, after the worst & most violent day ever in crypto, none of it was used?
3/11/2020 – 35,508 XBT
3/14/2020 – 35,210 XBT
(though I will say there was some "USD value" of the fund used, that is pretty minimal)
— lowstrife (@lowstrife) March 14, 2020
There’s still no official communication from the official BitMEX accounts, but will keep you updated of any response.
Over $16 million in BTC transferred from BitMEX
Despite the reported refunds, the community continues to show restraint as funds move from the exchange to unknown wallets – the latest being two transactions of about 1,600 BTC.
A certain fear is creeping into the field clearly manifested by the shrinking order book since the outage.
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Been in the field since 2015 and he still love everything blockchain and crypto! FC Barcelona fan. Author and journalist. Follow him at @lujanodera.