Deribit, the Bitcoin margin trading platform that took the community by storm after Twitter influencers threw their referral links around like candy at Halloween some months ago, has offered compensation to users after a glitch in their contract caused thousands of traders to be liquidated despite being in perfectly valid positions. The outage caused outrage in user groups and communities, pushing Deribit to reimburse its customers, with the total compensation to total some $1.3 million.
Coinbase Pro Affected
Deribit users were left stunned, bewildered, and eventually angry after they watched the value of the Bitcoin contracts crash to around $7,600 before instantly rebounding, causing stops to get triggered and users to get liquidated when there was no reason for them to do so. The error, which was caused by “BTC index calculation data issues”, also caused Coinbase Pro to suffer a momentary brainfreeze too, halting trading for 75 minutes around the same time. The outpouring on community channels was, not to put too fine a point on it, emotional, with many reporting serious losses and immediately demanding compensation. The reason for their concern is valid, as crypto is known for a general ‘no refunds’ approach, with individual platforms usually not legally bound to do so, highlighting the risk of using such platforms.
We’re Looking at You, BitMEX
After explaining what caused the outage, Deribit COO Marius Jansen informed users that compensation would be forthcoming:
We always want to do the right thing for our traders. Because of this, we are reimbursing traders that got affected by triggered stop orders and liquidations. My current estimate is that it will cost us at least around $1,300,000. These are basically profits that users have been making on the platform because of our bug. Of course, we are not taking this from the insurance fund.
Derebit has clearly realized that good quality customer service is the best way to retain users, and that a company’s reputation can sometimes be enhanced by the proper handling of an unfortunate situation. This is in stark contrast to other platforms like BitMEX, which often suffers outages at busy times, causing people to be stuck in trades, yet compensation is never offered in such situations. Perhaps with platforms such as Deribit and Bybit gaining some traction in the market, BitMEX will start to look after its customers a bit better too, although judging by a recent tweet this is far from definite…
BitMEX just doxxed its users in the most outrageously incompetent way imaginable: forgetting to use blind copy on mass email. Someone must be cleaning out their desk already. https://t.co/KmARzImxnk
— Jake Chervinsky (@jchervinsky) November 1, 2019