The PDAX exchange demands users to return BTC that was purchased for $6K during a glitch in the systems, which made the prices 88% lower and saw trading suspended. The exchange also held a press conference to explain exactly what happened so let’s read more in our latest crypto news.
One of the biggest exchanges in Southeast Asia is blaming a glitch for the price of BTC dropping to $6100 on February 16. An unknown number of users of the PDAX exchange managed to purchase thousands of BTC when the glitch happens at a massive discount and made the local currency billionaires for a few hours. The number of PDAX customers that withdrew their purchased BTC up the limit of the exchange has now been asked by the exchange to return the funds that were obtained during the crash under threat of potential legal action.
We'd like to thank you all for your patience regarding the incident that happened on Feb 16. Below is our statement, as of today Feb 20. Please expect us to continue to update you of the developments, which we are working on round the clock.
Thank you. pic.twitter.com/HvWFIRsSyy
— PDAX (@pdaxph) February 20, 2021
The tech glitch led to a 36-hour closure and a few users reported that they remained locked outside of their accounts. One user purchase BTC when it dropped and took it to Reddit to ask for opinion-whether or not they are legally required to return the coins and he received plenty of mixed responses:
“I managed to transfer the purchased BTC to another wallet outside PDAX just before they closed the trading and eventually the website. After almost 24 hours, they sent me a demand letter and SMS, requesting me to transfer back the BTC, which was purchased well within my rights without violating any laws or regulations of the trading platform, or they ‘may’ be compelled to take legal actions against me.”
PDAX CEO Nichel Gaba held a press conference to explain what happened the week ago. He explained that the burden on the exchange resulted in the unanticipated activity that introduced a glitch allowing users to be matched with a funded order. According to Gaba, this led to a cascade effect which crashed the BTC price beyond reasonable levels:
“It’s very understandable that a lot of users will feel upset they were able to buy what they thought an order was there for Bitcoin at very low prices. But unfortunately, the underlying Bitcoins were never in the possession of the exchange, so there’s never really anything there to be bought or sold.”
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