Crypto.com was one of the few crypto exchanges to keep Terra (LUNA) trades open as Terra’s death spiral saw an unrecoverable price crash of LUNA and stablecoin TerraUSD (UST). However, a technical glitch on Crypto.com’s mobile application allowed users to get away with a 30-40x profit on LUNA trades momentarily.
On Friday, Crypto.com abruptly barred users from trading after an internal tool detected the system quoting incorrect prices for LUNA due to some error. Just when Crypto Twitter started raising concerns about trade reversals on the exchange, Kris Marszalek, CEO of Crypto.com, revealed details about a glitch that allowed users to make away with massive profits.
There was a lot of customers who were buying at wrong prices and of course some also jumped onto the opportunity to exploit the glitch to the maximum.— Kris | Crypto.com (@kris) May 13, 2022
We reversed ALL trades.
Some customers saved a ton of $ and are thanking us, some didn’t abuse the glitch and are bashing us.
According to Marszalek, users who traded “during those 59 minutes” are eligible for a buyback option at the market price for LUNA tokens, which has since fallen to $0.0004685 at the time of writing. It is important to note that LUNA achieved its all-time high market price of nearly $120 on April 5.
“The root cause was a combination of multiple external factors (tick size changes due to Luna death spiral, withdrawals & entire Luna chain stopping) together leading to price dislocations that should typically be caught by index pricing, but weren’t.”
After a day’s review on the LUNA trade debacle, Marszalek informed that “all user accounts have been re-enabled.”
While Crypto.com reversed the LUNA transactions, the company has offered $10 worth of its in-house token Cronos (CRO) as a goodwill gesture for affected investors.
With LUNA’s price collapsing more than 99%, validators for the Terra blockchain officially halted the network aiming to prevent governance attacks.
The Terra blockchain was officially halted at a block height of 7603700.https://t.co/squ5MZ5VDK— Terra (UST) Powered by LUNA (@terra_money) May 12, 2022
Terra validators have decided to halt the Terra chain to prevent governance attacks following severe $LUNA inflation and a significantly reduced cost of attack.
The validators are expected to relaunch the network only after implementing a new patch to disable further delegations.
The patch release is out:https://t.co/BZ8t86cuwA— Terra (UST) Powered by LUNA (@terra_money) May 12, 2022
Delegations will be disabled once block production resumes.
The network should go live once 2/3 of the voting power comes online. An update will be provided accordingly. https://t.co/vffpjw7uom