dYdX raises margin necessities in some markets, bans “extremely worthwhile trades”


Decentralized crypto alternate dYdX has disclosed new measures to mitigate trading-related dangers after burning $9 million of its insurance coverage fund on Nov. 17 to cowl customers’ losses.

In keeping with an announcement on X (previously Twitter), the alternate elevated margin necessities on a number of “much less liquid markets,” affecting tokens reminiscent of Eos (EOS), 0x Protocol (ZRX), Aave (AAVE), Algorand (ALGO), Web Laptop (ICP), Monero (XRM), Tezos (XTZ), Zcash (ZEC), SushiSwap (SUSHI), THORChain (RUNE), Synthetix (SNX), Enjin (ENJ), 1inch Community (1INCH), Celo (CELO), Yearn.finance (YFI), and Uma (UMA).

dYdX triggered its insurance coverage fund to cowl customers’ buying and selling losses on Nov. 17 after a worthwhile commerce concentrating on lengthy positions on the YFI token brought on the liquidation of positions price almost $38 million.

dYdX founder Antonio Juliano dubbed the transfer a “focused assault” on the alternate. In keeping with him, YFI’s open curiosity in dYdX spiked from $0.8 million to $67 million in a matter of days on account of the actions of 1 particular person. The identical particular person, based on Juliano, tried to assault the SUSHI market on dYdX just a few weeks earlier.

“We did take motion to extend preliminary margin ratios for $YFI previous to the value crash, however this was finally not ample. The actor was in a position to withdraw a great quantity of $USDC from dYdX proper earlier than the value crash,” he wrote.

On X, the alternate’s group mentioned that “extremely worthwhile buying and selling methods have now been banned on dYdX,” in a reference to the language utilized by Mango Markets’ exploiter Avraham Eisenberg in his $116 million assault of 2022.

dYdX is now providing a bounty fee in alternate for precious info:

The YFI token declined by 43% in just some hours on Nov. 17 after hovering over 170% in November. The sharp decline worn out over $300 million in market capitalization from the current positive factors, in accordance to knowledge from CoinMarketCap. Previously 30 days, nevertheless, the token has nonetheless gained over 90%, buying and selling at $9,190 on the time of writing.

The Yearn.finance group hasn’t disclosed any official particulars in regards to the incident. A supply conversant in the matter informed Cointelegraph that builders on the group don’t management the vast majority of the token provide, strongly refuting preliminary issues a couple of potential rip-off. The declare is supported by Etherscan knowledge exhibiting massive centralized exchanges as YFI high holders.

Journal: Blockchain detectives — Mt. Gox collapse noticed start of Chainalysis