Reports revealed that OKEx’s move of changing the terms on $135million of derivative contracts is the key reason behind the price dropped over further. During the hard fork of Bitcoin Cash, happened last week, Hong Kong-based crypto exchange handles the daily trading volume of more than $1 billion.
This seems to be quite unusual for all traders because it is asserted that the OKEx was the sole trading platform, forcing an early settlement of BCH contract beside the fork. Moreover, OKEx involved the Bitcoin Cash contracts on November 14, without even prior intimation to its users which led users incurred heavy loss.
Besides losses, Bloomberg highlights the risk of utilizing “unregulated virtual currency exchanges”.
Notable Losses Justifying the Fact
- Qiao Changhe, a trader reported Bloomberg that he lost his $ 700,000. He was trading in Future contracts earlier and stated that he would have lost his $5 million funds due to OKEx nature of handling Bitcoin cash last week. Qiao moreover points “the exchange is losing its credibility”.
“The futures contract became something nonsense, not something we could use to hedge.” He adds.
- Other traders denied disclosing their names and pointed that they would close their relationship with OKEx or scale back most probably. However, a trader reportedly brings Hong Kon’s Securities and Futures Commission in a notice about the same.
In response to the Furious Trader’s comment and complaints, OKEx responds asking for apologies. It claimed that the decision of BCH settlement was taken in order to safeguard the funds of customers due to the volatility occurred while Bitcoin cash split. It has also accepted the decision without prior warning to users and stated,
“After considering various scenarios, we decided that an early settlement was the fairest and rational decision to maintain an orderly market,”
Amidst the volatile nature of crypto market, analysts are still betting on the upward move. What’s your opinion on the split of Bitcoin cash and the decision of OKEx? Let us know.