dYdX increases margin requirements and bans certain trades.
Key Takeaways
- dYdX increases margin requirements and bans certain trading strategies after losing $9 million in insurance funds.
- These changes follow a targeted attack that liquidated approximately $38 million in YFI token trading.
- Although the value of the YFI token has fallen significantly, it has still seen significant overall gains over the past month.
dYdXis a decentralized cryptocurrency exchange. Announcement of new trading limits and increased margin requirements After suffering significant losses from the insurance fund.
This decision was made in response to the following series of events: Fund lost $9 million on November 17This is to compensate users for trading losses.
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The cryptocurrency exchange stated that its margin requirements are as follows: Enhanced for various “less liquid markets”. It affects a variety of tokens, including Aave (AAVE), Eos (EOS), Monero (XMR), and more. This change Part of the dYdX strategy to mitigate trading-related risks.
These changes were triggered by: Profitable trading targeting long positions in YFI tokensThis resulted in a liquidation of approximately $38 million.
dYdX founder Antonio Giuliano explained this incident like “Targeted attacks” on cryptocurrency exchanges. He noted YFI’s dramatic increase in public attention and linked it to the actions of one individual. This individual also We suspect an attempt by dYdX to pre-manipulate the SUSHI market..
We took steps to increase the initial margin rate on $YFI prior to the price crash, but in the end it wasn’t enough. The actor was able to withdraw a significant amount of $USDC from dYdX just before the price crashed.
In addition to increased margin requirements, dYdX has banned “high-yield trading strategies.”
The YFI token plummeted 43% in value. It happened within hours on November 17 after a significant rally earlier this month.
drop this Burned more than $300 million in market capitalization From recent profits. Nevertheless, the token Still a respectable 90% increase over the last 30 days.At the time of this writing, it is trading at $8,956.
The Yearn.finance team has not released an official statement regarding this incident. However, sources close to the matter denied the fraud allegations. Etherscan data confirms the following: Most YFI supply is not controlled by developers. However, it is held by large centralized exchanges.
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