Friday, February 3, 2023

Exchange OKEx Denies It Manipulated Futures Prices

Exchange OKEx Denies It Manipulated Futures Prices

Following its recent rollback of futures trading, cryptocurrency exchange OKEx has denied it did anything to potentially tamper with the respective price. The denial comes following accusations from users that the exchange initially enforced the rollback to manipulate present figures and strengthen its revenue stream.

Also see: Co-Founder of Korean Exchange CoinNest Arrested in Seoul

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Let’s Start at the Beginning

Trouble began late last week when executives announced they would be rolling back futures trading due to an “irregular sell-off,” which may have caused prices to sink dramatically in comparison with that of bitcoin itself. The rollback allegedly undid many contracts going back several hours, meaning that several were either canceled altogether or traded for significantly less money.

At that time, the exchange said:

“OKEx always has customers’ best interests at heart, and we seek to provide the best products and technologies to protect our customers,” the company said in a written statement. “Transactions were suspended for several hours due to the incident. Please accept our sincere apologies for the inconvenience caused.”

The futures price eventually fell to about $4,755 USD on the platform, but later rebounded to roughly $5,200. Bitcoin also dropped and stood at approximately $7,000 on most other exchanges, which led to serious questions amongst users who felt the action taken was not only malicious, but completely intentional.

OKEx Innocent Until Proven Guilty

OKEx is now responding to these allegations, stating on its website that it was not involved in any sort of price manipulation, and that executives were now implementing “price limit rules” to prevent similar occurrences from happening in the future.

Additionally, representatives of the company, though not naming any names, simply said that a “group of people” were responsible for manipulating the contracts and causing the subsequent price drop.

OKEx logo

“We deeply apologize for the inconvenience caused,” employees claimed. When discussing futures contracts, they later commented, “We are not directly involved in the trades.”

The company also posted what it alleged were “fake screenshots” of price charts that were meandering through social media, and said that it doesn’t “profit from big moves in prices,” but rather earns the greater portion of its income from “transaction fees.”

Not the First Time

This is not the first time OKEx has faced accusations like these from its users. The company stirred controversy in early March after a researcher examined the company’s trading volume and alleged that the company was seriously exaggerating its numbers. Following further study, the researcher believed that “about 92.9 percent of all OKEx’s volume was most likely fabricated.”

Do you believe that OKEx had nothing to do with the price drop? Post your comments below.

Images via OKEx, Deep Dot Web

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