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Cryptocurrency exchange to credit traders for ethereum ‘flash crash’

By dailymail / Published on Saturday, 24 Jun 2017 17:00 PM / No Comments

Some traders who lost money in this week’s ethereum “flash crash” are going to be credited for their losses, the GDAX cryptocurrency exchange announced on Friday.

The price of ethereum, the alternative digital currency to bitcoin, crashed as low as 10 cents from around $319 in about a second in trading on the GDAX on Wednesday. The exchange blamed the move on a “multimillion dollar market sell” order.

In a blog post on Friday, vice president Adam White said the exchange was “confident all trades this week were executed properly, however, some customers did not receive the quality of service we strive to provide and we want to do better.”

Therefore, the GDAX will create a process to credit customer accounts which experienced a margin call or stop loss order as a result of that crash, he said.

Those affected customers will have their ETH-USD account restored to the equivalent of the account at the moment prior to the rapid price drop.

Some traders apparently lost a lot of money during the crash. On the social forum Reddit, users complained of losing large sums of money from $3,000 to $9,000.

Others saw it as an opportunity to make money. However, White noted that the exchange will honor all buy orders filled during that time.

“We view this as an opportunity to demonstrate our long-term commitment to our customers and belief in the future of this industry,” White said.

—CNBC’s Arjun Kharpal contributed to this report.