OKX Guarantees To Compensate Customers After Its Token’s Flash Crash

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OKX customers will get compensation after the alternate’s native token quickly misplaced half its worth.

On Tuesday, January twenty third, 2024, the value of OKB, the native token of the favored cryptocurrency alternate OKX, all of a sudden crashed over 48% inside quarter-hour. The worth plummeted from round $46.80 right down to $25.10 earlier than quickly recovering.
In keeping with a press release launched by OKX, the flash crash was triggered by the automated liquidation of a number of massive leveraged positions after OKB had initially dropped from $50.69 to $48.36. This cascading liquidation led to additional liquidations of collateralized loans, margin trades, and cross-currency transactions on the alternate. Over $6.5 billion in diluted market capitalization was briefly worn out earlier than costs rebounded.

OKX attributed the excessive volatility to the general downtrend in cryptocurrency markets that day, which additionally noticed Bitcoin shed 3% and Ethereum lose 6% amid a wider selloff. Nevertheless, the alternate acknowledged that the dimensions of the OKB crash was irregular and necessitated extra threat administration controls to forestall recurrences.

In a transfer thought-about uncommon for the unstable crypto trade, OKX pledged to “absolutely compensate customers for added losses brought on by irregular liquidation.” The alternate mentioned it’s engaged on formulating a particular reimbursement plan for affected prospects utilizing options like versatile loans, margin buying and selling, and multicurrency buying and selling. The compensation particulars are anticipated inside 72 hours.

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