any Traders Suffered Serious Losses
GDAX saw a dramatic flash crash on its ETH/USD market this past Wednesday. GDAX blamed the flash crash on a multi-million dollar market sell order that instantaneously wiped 29.4% of the ETH value from the market, in turn triggering a flood of stop order executions and margin liquidations.
GDAX Announces It Will Absorb Investor Losses From Recent ETH Flash Crash
Many traders suffered serious losses, quickly taking to the internet to express their anger. A Google Document began to circulate attempting to rally angry investors to mount a class-action lawsuit. Although no violation was made against Coinbase’s terms of service and legal action would be unlikely to be successful, GDAX and Coinbase’s public perception seemed to be hanging in the balance – just weeks after the company announced that it will be seeking a $1 billion USD valuation.
On June 24 GDAX released their second official update regarding the June 21st flash-crash. The statement begins by iterating that “we are confident that 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.”
The Company Announced That They “Will Follow up Directly With Affected Customers About This Process Next Week.”
“We will establish a process to credit customer accounts which experienced a margin call or stop loss order executed on the GDAX ETH-USD order book as a direct result of the rapid price movement at 12.30pm PT on June 21, 2017. This process will allow affected customers to restore the value of their ETH-USD account to the equivalent value of their ETH-USD account at the moment prior to the rapid price movement.”
GDAX Announces It Will Absorb Investor Losses From Recent ETH Flash Crash
GDAX also clarified that it would be honoring all executed buy orders that occurred during the crash, putting an end to rumors circulating online regarding the possibility that the exchange may move to reverse the profitable trades of those who managed to purchase undervalued ethereum tokens.
The company also announced that they “will follow up directly with affected customers about this process next week.”
Did you lose money during GDAX’s flashcrash? Share your experience in the comments section below!
I heard that some 3,300 shares were picked up near instantly at the .10cent mark, essentially turning one lucky individual (if not multiple) into instant millionares. The stop limit-loss fields in GDAX however should have been used by those stuck on margin calls. Trading on margin is always a risky bet and you should never bet with something you're not willing to lose.
I'm shocked (and glad) that GDAX is willing to pick up the tab on this one, but Coinbase (their parent/sister site) needs to do some serious Goodwill and PR damage control given the debacles of last weeks bullshit. I had funds stuck inside Coinbase for 48 hours, and with rumors of the site being shut down for good, their lack of PR and 'support' for assistance was nothing short of embarrassing.