At exactly 14:00 UTC, the price on the XRP/USD pair quickly plummeted from 33 cents to 13 cents, a 60 percent drop. During that minute, volume spiked to $6 million, according to BitMEX data. The cryptocurrency quickly recovered within a second and closed at $0.3277, suggesting a large leveraged trade was quickly wiped out.
XRP, the native asset of San Francisco-based Ripple’s XRP Ledger, experienced a flash crash on Hong Kong-based derivatives exchange BitMEX on Thursday.
CoinDesk reached out to BitMEX CEO Arthur Hayes via email regarding the incident but has yet to hear back.
An all-cryptocurrency platform, BitMEX offers highly leveraged trades of up to 50 times margin on collateral. If a bet goes the wrong way, a trader can be automatically liquidated, wiping out the collateral balance on the exchange instantly.
BitMEX offers some novel instruments not normally seen in the traditional financial derivatives world, including an innovative “perpetual” swap derivative that does not expire.
Long known as a bitcoin (BTC)-only derivatives exchange, BitMEX has added additional cryptocurrency assets in the past few years. Ethereum (ETH) trading was launched in 2018.
XRP is BitMEX’s newest addition, added on Feb. 5. The company has offices in Hong Kong but is licensed and registered in the Seychelles, where its gray-area regulatory status allows it to offer very risky bets on crypto. Bitmex has been investigated by the Commodities Futures Trading Commission and prohibits U.S.-based traders on its platform.
YouTube Suspends Ripple’s Tech Chief Days After XRP Scam Lawsuit Filing
YouTube has suspended the channel of Ripple CTO David Schwartz soon after the blockchain firm launched a lawsuit against it over XRP scams in videos.
Schwartz, who also goes by the online moniker «Joel Katz», said Wednesday morning that YouTube had suspended his channel. «Weirdly, YouTube just decided to suspend my channel (SJoelKatz) for impersonation. I wonder who they think I was impersonating,» he tweeted.
CoinDesk has reached out to Schwartz for comment.
YouTube can «terminate» channels that violate the platform’s guidelines, including for predatory behavior, hate speech, harassment, as well as impersonation. Channel owners are prohibited from creating new channels, but they are allowed to submit an appeal request if they think their channel was suspended or terminated in error.
Wednesday’s events come a week after Ripple initiated a lawsuit against YouTube on allegations the platform had failed to prevent fake XRP giveaway scams on the platform. The filing states YouTube’s unwillingness to suspend scam channels has led to users being defrauded out of hundreds of thousands of dollars, as well as reputational damage for Ripple.
«Ripple has repeatedly demanded that YouTube take action to stop the Scam and prevent further harm. Yet YouTube refuses, even where the same scheme is replicated time and again on its platform. YouTube’s response has been woefully inadequate and incomplete. As a result, Ripple and Mr. Garlinghouse continue to suffer substantial reputational harm,» reads the suit.
Schwartz’s channel was active for years so the timing of the suspension is interesting, given that it comes so close to the start of legal proceedings. Of course, it may be down to YouTube’s moderation algorithms messing up again.
CoinDesk approached YouTube for comment, but hadn’t received a response by press time.
