That move cost traders a lot of money, Bloomberg reported. It quotes trader Qiao Changhe, who said his fund lost $700,000 because its hedging position on OKEx was abruptly closed at a level that didn’t reflect prevailing market prices. “OKEx is losing its credibility,” Qiao said. “The futures contract became something nonsense, not something we could use to hedge.”
In a statement, OKEx apologized and explained it didn’t announce the settlement in order to reduce the risk of market manipulation. “After considering various scenarios, we decided that an early settlement was the most fair and rational decision to maintain an orderly market,” Andy Cheung, head of operations at OKEx, told Bloomberg.
Making things worse: On the day of the fork, a technical malfunction left traders unable to execute orders on the exchange for more than two hours, during a time of heightened market volatility, according to Amber AI, a crypto market-making firm. Read more here.