Poloniex Will Reimburse $13.5 Million Loss From Clams Flash Crash
Jack Martin's original article for cointelegraph.com reduced by 78%
Cryptocurrency exchange, Poloniex, has announced a scheme to reimburse users affected by a flash crash in May, which led to total losses of around 1,800 Bitcoin. In an Aug. 13 blog post, the company pledged to repay daily trading fees to impacted lenders until their losses are fully recovered.
Payments will begin later in August and the first credit will include all trading fees incurred since the generalized losses were first recognized on June 6, 2019.Margin trading multiplies effects of flash crash. Users can receive interest for sending their BTC to a lending pool, from which other users borrow to trade. In late May, a little-known token named Clams crashed almost 80% in less than an hour.
The unprecedented speed of the crash caused safety measures to fail in the automated liquidation system, designed to protect lenders' capital. The first occurred shortly after the incident, on June 14, when around 10% of the losses were distributed proportionally amongst impacted lenders.
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